How To Transfer Money To A Bank Account Abroad - Cheap And Easy Methods

For instance, if you are sending $1000 to a relative living in the United Kingdom, the bank will charge almost 8% as their processing fee. After the processing fee is charged, the rest of the amount is converted to British Pounds. The amount the recipient receives will be almost 833 Pound.

It is a sad reality that, when you are sending money abroad, you're actually losing some of the money in the process. At the tradable, we know this feeling. This is why we have taken help from a leading source and come up with this article.

Here we will share with you a few cheap and easy methods to transfer money internationally.

Top Practices To Send Money Internationally

To make an international payment, there are seven ways to transfer money. To make your choice easier, we will look into each method and when it might be the best option for you.

1. Bank-To-Bank Transfer: Bank transfers are the most convenient way to make any international payment. You need to visit your local bank and ask them to make a money transfer to the recipient bank.
2. Digital Banking Services: Digital banking services have found that most customers are not happy with bank transfer services. So, Neo-banks and Online-only banks are moving into this space. Some new players are offering low-cost international money transfer services.
3. International Wire Transfer: A wire transfer is a process of transferring money in digital form through the wired network maintained by banks and other financial services.
4. International Transfer Services: You pay your local currency directly to the transfer company. Then the money transfer company deposits the amount into the recipient’s local account.
5. Cryptocurrency Transfer: Cryptocurrency transfer is getting popular nowadays. You can use this method to convert your fiat currencies into Crypto and use the decentralized network to transfer the money to the recipient. The recipient, after receiving the money, can convert the Crypto to fiat currency.
6. Multi-Currency Debit Cards: These Visa and Mastercard services allow you to load your card with the local currency via bank transfer. After that, you can withdraw money from an international ATM.
7. Using Third-Party Online Platforms: The use of online payment applications like PayPal, Venmo, and Square is getting popular because of their convenience. People are using these online payment applications to make international payments.

Currently, these are the top practices for people to transfer money overseas. However, while every method does the same work of transferring money, each has unique characteristics that make them different.

Depending on what method you are using, the money transfer process can either be an expensive or cheap venture.

Key Factors To Determine Cheap Bank Transfers

1. Reliability Of The Transaction: Make sure that the services you are using to make international money transfers are reliable. Go through the certificates to see whether the company is licensed or not.
2. Rates Offered And Expenses: Gather information on the exchange rate and the rates offered by the companies. Financial institutions might charge a flat rate on the surface but might have hidden fees.
3. Convenience: Convenience of the sender and receiver while making international transactions must also be taken into consideration. If the platform or the method is hard to understand by the sender and receiver, it is better to avoid the services of that company.
4. Customer Services: Having help at hand is always better when you are making international transactions. Make sure that the company you choose to work with has reputable customer service in the event of glitches or delays in the transactions.

Top 3 Ways To Transfer Money Abroad

Simply using a bank transfer is easy. But the problem with this method is that bank transfers are quite expensive. And if you try to avoid bank transfers and look for cheap services, the tenure to complete one international transaction takes weeks to complete.

In that case, what to do? Well, we have the perfect answer for you. 

1. Money Transfer Services Like Wise

Wise, Formerly known as Transwire, offers a new way to transfer money internationally in a broad range of currencies. You get one platform from where you can make international money transfers to almost 70 countries.

When you use the banking network to transfer money, they will charge almost $50 dollar per transaction and offer poor exchange rates, which often include a markup of 3%. If this is not enough to make your international money transfer experience worse, you would often run into hidden intermediary fees.

However, this is not the case with Wise.

Wise works differently with its own payment network around the world. This means that Wise can move the money faster, at a lower cost, with no risk of sneaky intermediary fees.

Here is how the complete process works.

1. You will set up a transfer using the Wise website or app.
2. You deposit the agreed amount into the wise USD account.
3. Wise will start processing the transfer and send the money to the recipient.

This way, teh whole process ensures that no money has to leave the border, cutting out the cost of conversion and time to complete the transaction.

How Much Does It Cost?

The cost of international transfer depends on three different factors.

1. The country where you are sending money. Every country has a fixed fee.
2. The variable fees. This also varies depending on the country where you are sending money.
3. The amount of money you are sending.

For example, if you are sending money $1000 to the UK. The transfer charge will look like this - Fixed fee for UK is $4.77 + Variable Fee (0.43%) = $9.03.

2. Money Transfer Using A Broker Like Moneycorp

Moneycorp is regulated by FCA and follows the guidelines established by Payments Services Regulations. It is one of the largest and oldest money transfer companies in the UK and has helped users to exchange a total of 35 billion pounds last year.

As we have said that Moneycorp is regulated under the FCA’s guidelines, they are authorized to engage in investment advice, arrange different types of investment deals, and act as a principle in any investment activity.

That being said, whether you are buying property overseas or sending money to your loved ones, Moneycorp can send your money where you need it at a competitive rate.

While Moneycorp offers services at a lower margin than banking services, it might cost a little more than some online money transfer services.

What Are The Moneycorp Exchange Rates?

Exchange rates are somewhere between 3% to 4%, which is better than banking services. If you equate how much you can save using Moneycorp, you will find that you are saving more than $4000 on a transaction of $100,000.

Moneycorp exchange rates are the best for the mid-market rate and fluctuate on a general business day. This is why Moneycorp adds a 1% to 1.2% margin on the mid-market rate.

Note that these margins are on the mid-market and not the rate you will pay. 

That being said, Moneycorp charges -

1. $6.5 on a one-off transfer.
2. $11 on express services.

However, if you set up a recurring transfer, the charges will drop to $5 and $10, respectively.

3. PayPal For Ease Of Use

PayPal is a payment application that offers easy transferring of money internationally with just one click. The network of PayPal is spread across 200 different countries, giving users an opportunity to make an easy cross-border international money transfer.

However, the process differs slightly depending on whether or not the recipient has a PayPal account. 

If both users have a PayPal account, the transfer will be smooth from one Paypal account to another. However, if the recipient does not have a PayPal account, the payment can be sent directly to their bank accounts via Xoom (another payment service owned by PayPal).

Both options offer relatively fast payment options. The only downside is that PayPal charges are comparatively higher than the other two methods mentioned above.

PayPal Fee Structure For International Money Transfer

1. Transferring To A PayPal Account: The transaction fee is 5% of the total transferred amount ($0.99 - $4.99). In addition to the transferred fee, there is a 2.9% funding fee + a fixed fee based on which currency you are using for the fund transaction. Once everything is completed, add a 4% conversion fee.
2. Transferring Directly To Bank Account: Markup on exchange rates varies depending on the currency used for international transfer. Now add the fees when you are using a debit or credit card for making the transaction. 

Final Thoughts

As you see, there are many ways to transfer money internationally, but only a few methods can be considered cheap and easy.

We have listed the tried and tested methods that offer convenience and affordable rates.

Sending money used to be simple because of limited methods. With the explosion of different methods, the whole process has now become complex.

However, the upside is that now you have access to faster, safer, cheaper, and easier ways to make international payments.

Now you know the cheap and easy method to make an international money transfer. If there is anything more you want to know about transferring money Internationally, drop your queries in the comment section.