Understanding the Economy in Colombia
Colombia holds the title of the 4th biggest economy in Latin America, behind Brazil, Mexico, and Argentina. Its GDP was 271.40 billion US dollars in 2020, and the economy can be described as developing or emerging. Their main export is petroleum (45%), coal, coffee, and gold, although the country also has a fast-growing technology industry. The national currency is the Colombian peso, and at the time of writing, 1 USD is equal to 3,931 Colombian Pesos (COP).
Tourism in Colombia is also popular and growing every year. In 2019, the country had 4.53million international tourists - predictably, this number fell dramatically during the pandemic 2020, but numbers are quickly rising. In addition, multiple money transfer providers exist for tourists traveling to Colombia, which makes access to local currency straightforward.
Best Ways To Send Money To Colombia
The best way to send money to Colombia is almost certainly by using a money transfer provider. While perhaps not quite as popular as traditional international wire transfers currently, specialist transfer operators can offer faster transfers at lower rates compared to any other method.
Out of the payment methods most popularly offered by MTOs, you can choose to send money to Colombia via:
As to the best provider for sending money to Colombia, it really depends on where you are sendingfrom, plus several mitigating factors such as the amount you are sending and whether low cost or speed is a top priority for you.
For example, if you are sending money to Colombia from the UK,Azimooffers one of the most competitive rates and no fees (at the time of writing, their exchange rate is 1 GBP = 4,531.65353 COP. Another option with no fees and capable of processing your transfer within minutes isPaySend.
If you were looking for the best way to send money to Colombia from the US, one of the ways to do this would be viaWorldRemit. With an exchange rate of 1 USD = 3,397.8697 COP and fees starting from as little as $5, this money transfer operator can send your funds from the US to Colombia within the hour.
It is essential to make sure the money transfer operator you are hoping to sign up with does support transfers from your sending country to Colombia – our comparison engine helps to narrow this down for you.
Fastest Ways To Send Money To Colombia
Again, the fastest way to send money to Colombia is dependent on the individual circumstances of your transfer. Your sending country will affect the speed of your transfer (not all MTOs will support transfers from your country), but your chosen payment method can also affect how quickly your funds get to your recipient.
For some MTOs, such as Azimo, the transfer can be processed within a matter of minutes when transferring directly to your recipient’s bank account.
If your sending country isn’t supported by Azimo, however, you might find the fastest way to send money to Colombia to your recipient is via a transfer provider that supports cash pickups, such as WorldRemit or Western Union.
Cheapest Ways To Send Money To Colombia
The cheapest way to send money to Colombia is usually by bank transfer or paying by debit card with a specialist money transfer operator. Compared to paying by credit card or cash or making an international wire transfer with your bank, these payment methods tend to be the most cost-effective and cheapest way to send money to Colombia and get your money to your recipient.
Things to Consider When Sending Money to Colombia
Nothing compares to the satisfaction you get when you know that your loved ones in Colombia are well-fed, sheltered, and doing well. Before you press the send button or sign off that check, there are a few things you need to consider.
Alternative Investment Opportunities –Bancolombia has been championing for financial inclusion among families in Colombia that receive remittances. The bank wants to transform the money sent into savings and investments. It has lined up a wide range of products you can add to your portfolio as you build your nest egg. The second option is to directly invest in the Mi casa con remesas private sector – the IDB initiative. This initiative enables you to own a house through their mortgage program. The third investment opportunity is the house purchase program run jointly by the Colombian Ministry of Foreign Affairs and the construction sector. Finally, you should purpose to attend their housing fairs when they visit your country of destination.
Taxation –Colombia charges a tax of 0.4% on financial transactions, including ATM withdrawals and wire transfers. The regulated financial institutions and the Banco de la República have the responsibility of deducting this tax at the source. Your loved ones can claim 50% of the financial transactions tax for income tax offsetting if they keep proper records. The second most relevant tax is income tax assessed and paid by Colombian residents. For tax purposes, a resident is a person who is present in Colombia for 183 days in the year of income. Colombians living abroad may still have to pay taxes home if they fall under tax residency. However, they may claim credit for the income tax paid in the destination country.
Regulation of the Currency Market –Banco de la República heavily regulates inflows and currency exchange rate movements in the country. Transfers are subject to certain limits. Online money transfer services have their limits set. However, when doing international wire transfers, transfer specialists can be of great help.
Colombia remains a leading destination for remittances in South America. With over 10% of its nationals living abroad, the country is a lucrative money transfer route. As a result, many providers are increasingly joining in with new products and technologies to get a share of this market.
This development is exciting for Colombians living abroad. They have more options than before and can send money home however they want. To get the best deals, Colombians in the diaspora need to know the various ways they can send money home, the requirements for sending and receiving, the opportunities available to them, and the unique remittance landscape in Colombia.
Benefits of Sending Money With a Specialist Transfer Company
Customers that have never used a money transfer company may not be aware of the benefits. This section shares what you need to know about the advantages of sending money to Colombia and other worldwide locations.
Fees: the cost of sending money can add up when using a bank with around $20-50 per transfer. On the other hand, specialist transfer providers are a good choice for saving money. The savings made from lower operating overheads are passed down to customers. Make sure to choose the correct fee structure for the size of your payment. For example, if you are sending low amounts of money, then select a percentage-based fee structure.
FX rates: when sending money to Colombia, you may want to convert currencies from USD, GBP, and EUR to COP. Ideally, you should get the mid-market rate that offers the best deal. It means you are not charged a markup percentage when converting currencies. Companies like Instarem and Wise offer some of the best FX rates for most currency pairs.
Transfer speed: in emergencies or unforeseen circumstances, you may need extra funds quickly in Colombia. Therefore, fast transfer speeds are essential, and specialist transfer providers offer the quickest processing times. Balance transfers made with services like Wise allow the recipient to get funds instantly. Also, email and text messages are sent to keep the parties informed.
Ease of use: money transfer websites and mobile apps generally have good UX designs. Expect a minimalist design that streamlines the process of sending money. Therefore, newcomers can get used to a new service without a steep learning curve. Also, the recipient details can be saved, so you do not need to enter them every time. Test each service out for yourself to see if the website design matches your preferences.
Mobile app: sending money to Colombia with a mobile app is convenient and straightforward. Check Google Play and App Store to see if an app is available for the service you are using. Also, check the features to determine if international money transfers to Colombia are available. Finally, read customer reviews to learn about the pros and cons of an app. If you do not have the patience to read, then take note of the overall score – 4.0+ out of 5 is ideal.
Worldwide coverage: check the list of accepted countries to determine if you can send money to Colombia and other desired countries. Most specialist transfer providers offer 150+ countries in their network, including Azimo and WorldRemit. Note if there are limitations for specific countries, including transfer size or a list of accepted payment methods.
Cards: many money transfer services provide credit and debit cards that can be used to pay for products in Colombia or withdraw cash at an ATM. Look out for cards that offer free ATM transfers. However, the free service usually has a small monthly cap, and the ATM provider may have additional charges. Companies like Wise provide a free digital card that you can use to book flights and hotels.
Top 3 Companies for Sending Money to Colombia
The choice of money transfer services is vast. Every year new companies form in the hopes of providing the best service. We have researched the top specialist transfer providers for sending money to Colombia to save you time.
Azimo offers several advantages for sending money to Colombia. The low transfer fees allow you to save money whether you send small or large amounts. Also, a minimum limit does not exist, which is ideal if you want to send small transfers. Azimo offers worldwide coverage of over 200+ countries, so it is a good choice for customers that send money internationally.
The multi-lingual support of Azimo’s customer service department is perfect for users where English is not their native language. Also, multiple payout options exist that allow customers to get cash in Colombia.
WorldRemit provides a simple experience that offers transparent fees and competitive FX rates. On the homepage, you can enter the currency you wish to send, and the amount received in COP will be displayed. WorldRemit offers 150+ countries in their network, which includes Colombia.
The competitive transfer fees of WorldRemit mean it provides savings compared to banks. Therefore, it is ideal if you want to send funds to family, for business purposes, or travel money. However, this service is not ideal for large transfers because there are caps in many countries.
Wise is a top-tier transfer provider that offers some of the industry's best features. The transparent fees and FX rates allow customers to easily compare with other services. You get a preview of fees, and there are no hidden charges. The percentage-based fee structure means that it is a good choice for sending small amounts of money.
Wise has a TrustPilot Score of 4.6 out of 5, which means that most users are satisfied with the quality of the service. Also, the user interface is simple and filled with handy information to help users send money internationally.
Looking to Send Money Somewhere Else?
Sending money anywhere else in the world is as easy as sending money to Colombia.