Transferring money from one country to another can be accomplished through a variety of methods. Depending on where you are located and how much money you want to send, you may choose to work with a bank to write a check or conduct a wire transfer to complete the transaction. To transfer money, you can also make use of a remittance service. When dealing with large sums of money, it is best to use a foreign exchange service.
Method 1 Using Banks to Transfer Money
1. Make a draught or a check in a foreign currency. It is possible to send money from a bank account in a foreign country to a recipient in the United States by writing a check in the recipient’s home country’s currency and mailing it to them in the United States. The check can then be cashed at any bank in the United States by the intended recipient. The recipient, on the other hand, may encounter some difficulties. Every country has its own set of rules and policies regarding personal and business checks, and they differ from one another.
If a foreign check is payable through a bank in the United States, many banks in the country will not cash it.
It is prohibitively expensive. If the check is accepted by the American bank, the bank will keep a portion of the exchange rate as a fee. Additionally, they may charge a fee for processing foreign checks.
The funds may be subject to a hold by the American financial institution. In other words, the money won’t be available to the recipient until the check has cleared, which could take a few days, a few weeks, or even several months.
2. Make a wire transfer through your financial institution. You can go to your bank and ask for a wire transfer to be sent to you. A wire transfer is an electronic transfer of funds from one financial institution to another that occurs between two financial institutions. You’ll need to find out if the receiving bank accepts wire transfers in foreign currencies before you can send one. If this is not the case, you will be required to wire the money in U.S. currency.
You should expect to pay a one-time fee for initiating the wire transfer transaction. In addition, the recipient will be charged a one-time fee for receiving the wiring transfer. The amount of the fee varies from one bank to another.
Depending on the country, international wire transfers can take anywhere between three and five days.
3. Obtain the necessary information. The bank account number and the recipient’s name and address are required in order to send money internationally via wire transfer. Additionally, you will need to know the name and address of the receiving bank, as well as the routing number and code.
In Belgium, the Society for Worldwide Interbank Financial Telecommunication (“SWIFT”) assigns SWIFT codes to each bank, which serve as unique identifiers for the institution.
The routing number is a nine-digit code that identifies the location of your bank in the United States. You’ll find it at the bottom of your checks, on the left side of the page.
Method 2 Using Remittance Services to Transfer Money
1. Wire money from Western Union or MoneyGram to your bank account. You have the option of visiting a physical location or initiating the wire transfer online. You can fund the transfer with cash, a debit or credit card, or a combination of the two. You can send the funds directly to the recipient’s bank account, or you can send them to another Western Union or MoneyGram branch office for delivery.
You make your payment in your home currency, and the money is transferred to the recipient in the United States in U.S. dollars. As a result, be aware of the current exchange rate and make the necessary adjustments to ensure that the recipient receives the correct amount.
Consider the following scenario: you are in Australia and you want to send $20 to a recipient in the United States, and the current exchange rate is 1 AUD (Australian dollar) = 0.6985 USD (U.S. dollar). In order for the recipient to receive $20 USD, you would need to send $28.62 in Australian dollars.
The fees associated with sending money internationally vary depending on the amount being sent, how quickly the money must be made available, and the payment method selected.
2. Western Union and MoneyGram are two popular money transfer services. Western Union is the more established of the two companies in terms of size. Because it has been in business for a longer period of time, it has earned a good reputation, and people have confidence in the company. The fees associated with Western Union can be prohibitively expensive. MoneyGram fees are generally less expensive than other payment methods. MoneyGram has also built its reputation on the ability to transfer money internationally.
3. Make a payment through PayPal. PayPal is a remittance service that operates online. Both parties must be registered PayPal users in order for the transaction to be successful. In addition, both parties must have a bank account with a registered financial institution. Log into your PayPal account and select “Send and Request,” followed by “Send Money to Friends and Family.” To begin the transfer, click on “Send Money to Friends and Family.” Enter the recipient’s e-mail address, mobile number, or full name in the appropriate field. Your local currency is used to enter the amount, and PayPal converts it so that the recipient receives it in his or her own local currency.
The cost of a transaction is determined by the currency in which it is conducted. In most cases, it is a percentage of the amount sent, plus a flat fee for the transaction.
4. Xoom is a service that allows you to send money. With Xoom, you can transfer funds from a bank account up to $2,999 USD for a flat fee of $4.99 USD per transfer. When paying with a credit card, the cost is higher. The money is deposited into the recipient’s bank account within two business days of the money being received. In most cases, the exchange rate is set at the time of the transfer.
Xoom can send money to 56 countries outside of the United States, and it allows you to send money to anyone in the United States who has a bank account in the United States.
When it comes to fees and exchange rates, Consumer Reports named Xoom as the best way to send money internationally in 2012. Xoom beat out PayPal, MoneyGram, and Western Union, according to the publication.
Method 3 Using Foreign Exchange Services to Transfer Money
1. Understand what a foreign exchange service is and what it does. Don’t get them mixed up with foreign exchange traders, who provide a completely different service. Financial institutions, such as foreign exchange (forex) firms, facilitate international currency transfers for individuals and businesses. They transfer funds from one country to another while also exchanging currencies between the two countries involved in the transaction. Despite the fact that the majority of forex companies are based in the United Kingdom (UK), some are also based in North America and Asia.
It is recommended that forex companies only be used for large transactions of more than $3,000. The company does not charge a fee; instead, they profit from the fluctuation in the exchange rate.
Consider OFX, an online forex company that accepts wire transfers from your bank account or can set up an ACH direct debit account for you. It takes one to two business days for most transfers to be completed, and you can keep track of the progress through their app. It costs you nothing to transfer money — $5 for transfers of less than $5,000, and no fee for transfers of $5,000 or more.
2. Start the transfer process. Make sure you have an account with the broker if you don’t already have one. Creating a new account may take a few days or even weeks. After that, deposit funds into your brokerage account or transfer funds from your bank account to your brokerage account. Provide the information about the recipient to the brokerage firm. Investigate the current exchange rate.
Utilize the current exchange rate to complete the transaction if you are comfortable with it at the time of the transaction.
3. To lock in a rate, you can use a forward contract. If you need to send a large sum of money at some point in the future, a forward contract will allow you to lock in a favourable rate today at a later date. This means that the broker agrees to use a rate on which you agree today for an exchange that will take place in the future at your request. The contract rate, not the current exchange rate, is used on the date of the exchange, not the date of the transaction.
If you believe that your local currency will weaken before the trade takes place, you can employ this strategy.
Method 4 Saving Money When Transferring Funds Internationally
1. Take your time and look around. Not all services use the same exchange rate, which is why you should shop around. In addition, fees differ from one service to the next. Transaction fees and exchange rate differences add up quickly when dealing with international transactions. Spend some time determining how much it will cost to complete the money transfer under various scenarios and then make your decision.
For example, one service may charge you a higher fee but provide you with a better exchange rate than a different service. Take a look at the total amount of money that the recipient receives. Because of a favourable exchange rate, it is possible that paying a higher fee will result in a lower overall cost.
2. Take the size of your transaction into consideration carefully. As a rule, it is less expensive to transfer a large sum of money at once than it is to transfer several small amounts at different times. The fees you will be charged, on the other hand, will be determined by the amount of money you transfer. For small amounts, you should use a service that is designed for small amounts and charges reasonable fees for its use.
3. Make use of the currency in your home country. Transferring money in your local currency and allowing the recipient to exchange the currency will save you money. If you try to exchange currency ahead of time in order to wire funds in the recipient’s currency, you will end up spending more money in the end than you intended. For larger sums, however, it is recommended that you use a foreign exchange service. They are always able to obtain the most favourable exchange rates.
4. Select a time frame that is longer in duration. The fees you will pay will increase in direct proportion to how quickly you want the money transferred. It is possible to send money within hours or minutes of placing an order online. However, depending on the amount of money you are sending, this service may be prohibitively expensive. Allow several days or even weeks for the transaction to be completed if at all possible. If you have secured a favourable exchange rate, you will be able to save money on transaction costs.
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