Sending money to any location in the world can generally be done in just a few minutes, no matter where the recipient is. But it’s worth knowing that you’ll pay for the convenience and speed that comes with fast payments. Fees charged for international transactions can be costly, which is why it is worth investigating the various money transfer options.
Most people know of money transfer operators such as MoneyGram and Western Union. Both companies are well-known for sending money quickly to remote parts of the world.
In particular, these services are useful if the recipient of the money doesn’t have a bank account.
Such services are often convenient because you can transfer money online, via the phone or in store. MoneyGram, for example, says it has 203,000 agents in 190 countries and, in most cases, will get the money transferred within 10 minutes.
However, the fees for speedy, round-the-world transfers are usually high and will often increase with the amount of money. For smaller amounts, like £100, expect a fee of 5-8%.
Banks are also an easy option for many people. However, the fees for international bank transfers are well worth noting. Some retail banks are known to charge more than £25 in fees and exchange rates are not transparent, incorporating 5-7% margin on top. Another downside is that international bank transfers often take a few days, and are considered one of the slowest types of international money transfer. But in some cases, banks have international branches and this can be worth your while when transferring money. For example, if you and your recipient both have an HSBC account in the UK and Hong Kong respectively, you can transfer money free of cost or at a very low charge, and the funds will be in place in no time. But don’t forget you will not get the best deal in terms of exchange rates.
If you really want to save money, when wiring a large sum of money abroad (more than £1000 for example), the best option is usually to use a Foreign Exchange (FX) broker.
The most compelling reason is the better exchange rate and low fees. In most cases, FX companies are 3-4% cheaper than bank transfers and often offer benefits for regular and corporate clients. For instance, UKForex offers corporate customers deals without fees and the ability to lock in exchange rates prior to the transfer of funds. Often, FX companies offer 24-hour services and can complete a transfer within a day or two. The option is also easy to use because you can transfer money to the FX provider via online banking. That means no need for hard cash and big savings on transaction fees, no matter how much money you’re sending.
Lastly, it’s worth remembering online money transfer services like PayPal. If you and your recipient have PayPal accounts (and email addresses), it’s possible to transfer money between international accounts instantaneously. However, the fees for such transfers are usually set at minimum 4%, which could prove expensive for larger transactions.
That said, it’s important that you consider how much money needs to be transferred and how quickly the transaction needs to go through. In most cases, banks and money transfer operators earn big bucks on transaction fees – money that you could be saving by using a dedicated foreign exchange broker instead.
Contributed by UKForex. UKForex offers competitive exchange rates to help individuals save money on their international transfers.
