A Complete Guide to International Money Transfer from Australia

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It’s Easy If You Do It Smart!

In today’s fast-paced world, it is no surprise that people need to transfer cash internationally very frequently. The need is generally more intense for individuals who live or breathe the international life.

Businessmen, investors, stakeholders and individuals who deal globally will always need to move cash over political borders. Whether it is for storing cash in another bank account, for paying workers abroad, for purchasing real estate, or for any other reason, the need is always there.

Furthermore, the list of the reasons doesn’t stop there. Shouldn’t something be said about transferring pensions or paying for a home loan abroad? Need to give money to the relatives back home? Need to invest in something abroad? What about buying a vehicle abroad? The necessities are endless.

But, whatever the reason is, transferring money abroad can be challenging. As a result of increasing frauds, places like Western Union ask a million questions. Their no relation to the transaction is the greatest problem with such systems. In case you need to send your own cash this way, it’s truly a hassle.

Over that, there are charges. Banks and the Western Unions of the world have been known to charge high fees. Utilizing a bank is one of the simplest methods for sending cash abroad, but it is the most expensive one. So, which is an ideal approach to transfer money overseas? To figure out, let’s first discuss the ways in which you can make such type of transactions.

What Options Are Available For Sending Money Overseas?

There are a few different ways to send cash from Australia to another nation.

Bank Account Transfers

You can transfer money directly to an overseas bank account from your own bank account. It is also called as universal money transfer method, a telegraphic transfer, or a SWIFT or wire exchange. A few banks also offer online cash transfer services that enable you to send cash yourself to an abroad bank account. But, this can be a more costly alternative and it could take 2 to 5 days.

Online Money Transfer Companies

Online transfer organizations ask you to set up an account online and let you transmit your cash yourself over the web. The company then moves the cash to your recipient’s bank account.

This transfer technique can be fast and cheap, but you should be comfortable in making transactions on the web and know the account details of the person to whom you want to send the money. See more info about them here.

Cash Transfer – Using Money Transfer Company

Cash transfer organizations allow you to transfer your money using cash or EFTPOS. You can approach such organization at their storefront or utilize any outsider convenience store counter. The individual you send the cash to will collect the cash at the cash transfer office in their nation.

Some organizations will also allow transferring cash by using the internet or a bank card once you are done with the account set up with them. You just need to tell the recipient that you’ve sent the money and that they can collect it from their nearby office.

This sort of transfer is often quick – it could take only a couple of minutes – however, can be costly. Australia Post additionally offers money transfers which can be done at all Australia Post offices that have the Bank@Post sign showed. To learn more, you can see the information here.

Universal Money Order (IMO)

A more secure technique than sending a personal check abroad is to utilize an international bank draft. You give your cash to a bank and get an international ensured check in return. Then you post the check to your family or individual who then needs to deposit it into their account.

While they are secure, this strategy can cost more than others, and posting it will be slower than an electronic exchange.

A Few Easy Ways to Transfer Money Internationally

A Bank Transfer minus the Bank

A bank transfer enables you to send cash from your account in Australia to another bank account in abroad. There are numerous Australian and worldwide organizations that spend significant time in doing the very same thing, aside from with much lower charges and better exchange rates.

A few choices in Australia incorporate TorFX, XE, OFX, Western Union and World First.

In case you are sending more than $1000, ‘non-bank’ cash transfer organizations are less expensive because their charges are lower and their rates are more competitive. Transfer expenses differ between $10-$15 for less cash. Most organizations offer charge free transfers for sums over $10,000. Find out more here.

Paypal

When you utilize Paypal to send cash abroad, the currency conversions rates are not incredible but the charges are nearly non-existent. It’s also super speedy when the individual you are paying has a Paypal account. .

In case you are paying somebody under $1000, for example to an abroad freelancer, Paypal is less expensive than utilizing a bank. This is because they don’t charge a bank exchange expense, which can vary in between $18 and $32.

This technique is most appropriate for smaller sums i.e. under 500 where both parties have access to email and the individual getting the cash does NOT require it quickly. Keep in mind, if you transfer cash from paypal to another person’s Paypal, they will still need to get that cash through their bank account and this can take up to 5 – 7 business days.

Peer to Peer Transfer

Transferwise and CurrencyFair are the 2 greatest organizations that offer P2P transfers. Rather than going to a bank, they match individuals purchasing currency in one nation with individuals in different nations who are selling currency.

This matching enables them to offer better exchange rates. Sometimes, if they can’t discover a match, the charges and exchange rates could change. P2P transfers can be a significantly less expensive alternative for transfers amongst $1000 and $100,000.

Bitcoin

You can utilize Bitcoin to send cash abroad but know that it can be a bit complicated, especially if you are not familiar with utilizing a digital currency. You’ll need to set up a wallet with a Bitcoin organization, as Coinjar, then add money to your online wallet in Australian dollars, convert it to Bitcoin and send it to the individual you are paying abroad. They additionally need to have a Bitcoin wallet and will then convert it to their currency.

Bitcoin transfer costs are much lower since you don’t have to experience any banks to send the funds. The exchange rates are better than a bank but you include some exchange rate hazard since you are converting currency twice rather than once.

Blockchain Technology

The upcoming generation of universal money transfer is blockchain. The Blockchain is the innovation behind Bitcoin that eliminates the need to visit a channel of banks for sending cash from one nation to another.

They have similar aspects to utilizing Bitcoin, including the advantage of super-quick payments and low transaction expenses. The principal difference will be the complexity. You won’t have to set up a wallet and the individual you are paying won’t require a digital wallet to get the cash.

Blockchain technology will enable international transfers to take place in seconds and at a small amount of the cost that bank transfers have. Shockingly, the innovation is still relatively new and needs more prominent acknowledgment from the regulators and banking fraternity. But, don’t be sad, you won’t need to wait for too long for this technology.

What is the Cost of Sending Money Overseas through Banks?

Numerous Australians believe that sending cash abroad through banks is a free service. But, the truth is a bit different. Research reveals how little Australians know about the costs involved with sending cash to another country. Considering one out of three Australians has sent cash abroad the level of understanding, or deficiency in that matter is stressing.

When sending cash to another country through your bank, you will be charged a universal cash transfer fee that could be up to $30, relying on the bank that you use. Your expense may even be based on the currency in which your cash is being sent, and you may likewise acquire an additional charge to speed up your transfer. And it doesn’t end there. When you send cash through your bank, you’ll most likely pay a margin of up to 5% on the everyday exchange rate.

Banks utilize something many refer to as the interbank rate to exchange cash with each other. This rate varies by the second, and you can check that rate simply by Googling something like ‘1 AUD to USD’. However, that is not the rate that the banks give you, they typically add up to 5% on the daily exchange rate, so on a $10,000 transfer, you could pay $500 over the expenses charged to send the cash.

When banks send cash from Australia abroad they charge a transaction fee and furthermore a margin on the genuine exchange rate. This is the reason you’ll be cited diverse trade rates when you get quotes from a few providers – they all charge their own margin. This margin is not usually transparent, so it can be hard to know exactly how much it’s costing you. As per a research, Australians are paying a tremendous $3.1 billion a year on poor exchange rates and abroad card charges.

Australians are being ripped off because of poor currency exchange rates and expense associated with the same. It’s not only individuals who are being ripped off. Small and medium-sized businesses are also loosing almost $150 million a year because of high fees for international money transfer.

It is also confirmed by the researchers that the most costly way to purchase foreign currency is through the banks. Most of the banks tell their clients that they just pay a little upfront fee for universal payments, however, in reality, the clients end up with paying much more. Enormous hidden charges are taken in the form of the exchange rates, generally without the client realizing.” And it is not just travelers who are paying this much price. Those sending money internationally to loved ones also end up paying a lot more.

World Bank figures demonstrate worldwide cash exchanges from Australians to their loved ones overseas is increased up to 26 percent in the five years to 2015, one of the greatest percentage increments in remittances of any nation in the world.

The banks have a lot of overheads than the online currency exchange services; however, it additionally could be that banks are exploiting their clients who don’t look around.

Factors to Keep in Mind While Sending Money Overseas

What service is the best to transfer cash abroad relies on the circumstance. For example, some services offer better terms for bigger measures of cash however the higher expenses make them less appropriate for exchanging smaller measures of cash.

Remember the following factors that play a major role in determining what is the best and the cheapest way to transfer cash abroad

• The present exchange rate between currencies.
• Are you sending one currency to another or keeping it same for example, transferring USD to a CAD account in Canada or transferring USD to a US Account in Canada.
• How much cash you need to send (a little amount or large amounts).
• Is it a one-time transfer or you may again need to send some money?
• How rapidly you require the payment to arrive there.
• The nation you are sending from and the nation you are sending to.
• Where your funds start from (from a bank account, from a MasterCard, from a digital wallet, bitcoin or cash etc.).
• Cost (how much money the process will cost you after all the fees and the exchange rate balanced out by all the advantageous and speed factors you get).
• Safety – how ‘safe’ is the process you follow for money transfer.

Remember, a single offer never offers the least cost, the quickest speed, the best convenience, and the high security. You should balance these out to find a satisfactory deal. Some of the least expensive transfer cash abroad options are additionally the slowest and least convenient techniques, while the most costly alternatives are the quickest and frequently most convenient.

Conclusion

An easy homework is needed when it comes to transferring money abroad.

Once you get to know about the best alternatives that are available for you, sending cash internationally doesn’t need to be a headache. You should figure the expenses including exchange rates and fees related to the transaction. You should analyze different alternatives available before picking the one. Each strategy costs something, but you should ensure that more of your cash goes where it should – to your recipient, not to any third party.

 

Author Bio: Alex Smith is an editor and works at GCC Home Loans. He enjoys creating, uncovering and disseminating new and interesting perspectives on Finance, Investments and Mortgages.  GCC Home Loan provides Commercial Loans and Property Finance services throughout Australia.

The post A Complete Guide to International Money Transfer from Australia appeared first on Oak Laurel.

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