There are many reasons why people send money overseas. You may have a relative, a child, or a business partner who lives abroad and you might want to send those cash once in a while. According to the 2017 World Bank report, people in the US sent over $625 billion to their relatives back in their home countries.
If you are in a situation where you need to send money internationally, you might have concerns about the best way to go about it. Fret not since you have come to the right place. In this in-depth review, you will learn how to transferring money internationally between the banks, using peer-to-peer avenues, and through other cool methods. You will also learn the factors to consider while choosing an international money transfer method among other cool stuff.
Therefore, strap in and enjoy the ride.
How Can You Send Money Internationally?
It is possible to send and receive money within the United States in many ways. There are similarly many ways also of sending money outside of the country too.
Below are some ways in which you can transfer cash internationally. These methods include:
- Cash to cash transfer
- Bank to bank transfer
- Account to cash transfer
- Credit to credit transfer/ debit to debit transfer
- Prepaid debit card
- Digital wallet
However, our main interest here is bank transfers, lets go deep into that.
Process of Transferring Money Internationally Between Banks
One of the traditional ways of sending cash has been through the banks. The banks are considered being secure and most people are confident that when they transferring money internationally through the banks, the recipient will definitely receive the money.
Read on to have a better understanding of how bank wire or money transfer through the bank takes place.
When transferring money internationally through your banks, the banks uses a transfer system known as SWIFT. SWIFT in this case does not mean very fast, rather it is an acronym which means Society for Worldwide Interbank Financial Transactions (SWIFT).
Not all banks have an internal presence. As such, it was important for banks to have a system where they can transfer money between different banks so as to ease international money transfer.
For instance, let’s say that you are in America and you want to send cash to Brazil.
In America, you use Chase bank which is not available in Brazil but still wants to send cash to a person in Brazil. All you will need to do is provide the routing and account number of the recipient’s bank.
Chase bank will use the SWIFT system to transfer cash from your account to the recipient’s bank account in Brazil. The transaction will go through even though there is no Chase bank in Brazil thanks to SWIFT.
One of the downsides of this method is that it might take as much as 7 days for the money to reflect in the recipient’s account. Another downside of this method is that the fees might be high.
If your bank has a branch in the recipient’s country, it is possible to transfer cash from your account to the recipient’s account. For this method to work through, you must provide both your routing number and bank account number and also those of the recipient. You can transfer cash in this way either online or through the phone.
Advantages
One of the greatest advantages of this kind of transfer is that it can be cheap or even free in some cases. In most cases, banks do not charge a transfer fee provided the recipient is willing to wait for at least three working days. However, you can pay a few dollars for expedited transfer if the cash is required urgently.
Disadvantages
For this method to work, you will need to have the routing and bank account number of the recipient. If the person to whom you are sending the cash is a stranger, they might be hesitant to give this information. The method will not work if the recipient does not have an account in the same bank as the sender.
Another downside of this method is that it might take as many as 7 days for the money to reflect in the recipient’s account. Another downside of this method is that the fees might be high.
Transferring Money Internationally Between Banks Through Your Bank
As you can see, it is possible to send cash internationally through the bank. But, how exactly do you go about it? We are glad you asked!
Below are the two main options that you can use to send cash internationally through your bank
1. Send Money through Your Bank Online
The first method by which you can send money to a person who is overseas through your bank is online. Below are the steps that you should follow to make the transfer successful.
Locate the wire transfer option in your bank’s website
The very first step is to log into your online bank account. The international wire transfer option is usually on the home page. If you have a problem locating this option, you can simply ask for assistance from the bank’s customer care assistants and they will be more than willing to help you out.
Check the transfer limit
Many banks have a cap on the amount of cash you can transfer online from your bank account. For most banks, this cap is $5,000. If you need to transfer more than this amount, you will have to call your bank to get authorization for the transaction.
For security purposes, the bank might ask for some verification. The bank can send a code to your email address or your phone number which you will need to feed to the system in order to continue with the cash transfer transaction.
Provide the account and personal details of the recipient
Below is the recipient’s information that you will need to provide.
- Their bank’s name and address
- The name of the recipient, address, and the type of account they operate. It can either be savings, checking, current, etc.
- The recipient’s account number also known as IBAN or International Bank Account Number.
- The SWIFT/BIC code of the bank where the recipient will receive their cash. This code acts as the routing number in the American banking system.
Feed the amount and the currency in which you want the recipient to receive their cash
The system automatically feeds the currency in which the recipient will receive the cash once you indicate the country to which you are sending the cash. If you are ok with the currency you can leave it as it is. However, you have the option of changing the currency to one of your choosing.
It is important to ensure that the recipient’s bank supports the currency which you indicate. Otherwise, the whole transaction might be rejected.
Pay the fees
Once you ensure that all the information is correct, it is time to pay the processing fees. The current transfer fees of most banks range from$40 to $50. However, this fee can go as high as $80. Therefore it is important to find out before initiating the transaction.
It is also possible for your recipient’s cash to charge a fee. The fee is around $10 to $20. It is also quite likely that the intermediary banks will also charge a fee. Therefore, due to these charges, this method can get expensive.
2. Performing the Cash Transfer in the Bank Physically
It is also possible to perform the transfer in person. The process of transferring cash in person is similar to transferring the cash online. The only advantage of this method is that you can get face to face assistance from the banking staff should you run into any trouble.
However, to make the process easier, there are some documents and information that you should bring along.
- The recipient’s bank name and address
- The account type of the recipient, their name and address
- The account number of the recipient also known as the International Bank Account Number (IBAN)
- The SWIFT or BIC code of the recipient’s bank
- A government-issued identification document
Factors to Consider When Selecting an International Transfer Method
Before you choose the method by which you are going to send money internationally, there are some factors that you consider. You should consider the time, cost, coverage, and ways of receiving the cash. Let us look into these factors in more detail.
- Time : Some transfer methods take more time than others. Therefore, depending on the urgency, you can choose to use a fast service or a slow service. It is important to note that the faster the service the more fees you will pay.
- Fees : Different transfer methods have different fees. Some will charge a fixed amount while others charge a percentage of the cash you are transferring. You should also note that some transfer companies charge differently for different currencies.
- The Exchange Rate : Another very important factor to consider when selecting the method to use for international money transfer is the exchange rate. The exchange rate has a direct effect on the amount of cash the recipient will receive. If the company offers a low exchange rate, then the recipient will receive less cash. It is therefore important to check the exchange rate to get the best deal.
- Coverage : Another great factor to consider while choosing a money transfer method is the geographical coverage of the company. Some companies have a wide presence while others are not as much. For instance, Western Union is in more than 200 countries.
- Ways Of Receiving The Cash : Another important factor to consider while sending cash is the ways by which the company allows the recipient to access the cash. Some companies have more than one way through which the recipient can get the cash. For other companies, the recipient must have a bank account.
FAQ – Frequently Asked Questions
Which is the best transfer method?
Each international transfer method has its own advantages and disadvantages. It all depends on what you are really interested in. if you are interested in speed, you should go for the services which offer expedited delivery. If you are interested in using the cheapest method, you should go for a service which does not charge high fees.
Is it possible to send money anywhere in the world?
Different international money transfer services offer their services in different nations. It is therefore important to check if the company you want to use operates in the country where you want to send the cash.
Final Recap
International money transfer services are very crucial for people who want to send cash all over the world. Luckily if you find yourself in such a situation, there are many avenues that you can use. You might decide to use your bank or other alternative means like peer to peer money transfer options. The choice of the method to use depends on a number of factors including the time it takes for the recipient to receive the cash, the fees the transfer service charges, and other similar factors.
We are sure that you are now well informed on the ways you can send money internationally.
