When looking for the best way to send money to business associates, shops, family, or friends abroad, there are lots of options you can choose from to facilitate your transfer. Traditionally, banks have been the go-to choice for transferring money between people thanks to their well-known brands and international networks, but banks now have competition from a host of online money transfer providers that are often able to offer better & cheaper ways of sending money abroad and offer better exchange rates.
When you’re looking to send your money internationally, it makes sense that you’ll want to find the best deal for your transfer needs. Speed versus cost, convenience versus security, the destination, the amount of money you are sending… all of these things can have a big impact on what is the ‘right’ way for you to send your money internationally. The easiest way to send money will change depending on your specific needs.
In this guide, we’re covered some of the most important things to consider when finding the best way to send money abroad for you – plus our top recommended providers depending on where you are in the world.
The best way to send money abroad really depends on your specific needs, which is why we would always recommend comparing providers to find the best rate and transfer time for you. If you are looking to find out what can be classified as the ‘best’ way, it all boils down to finding out:
After all fees and charges, how much money will be left over – and how fast will my recipient receive it?
What makes a service the best option for you depends on a number of factors such as:
Money transfer companies are particularly useful when sending money in emergencies or to remote areas where people have no access to formal banking services, but they can be used in any scenario and are most often the best option when transferring money overseas.
There are several things that you need to consider when looking for the best way to send money abroad, such as:
This can sometimes be referred to as the ‘hidden cost’ of money transfers. As opposed to fees, the exchange rate may not always be shown upfront – but it can add up to be more expensive than upfront fees, particularly when transferring large amounts.
To put this into perspective, consider a scenario where you are sending £2000 from the UK to the US. Online providers such as TransferWise will process your transfer at the mid-market rate (the mid-point between the buy and sell prices of two currencies) and charge a set-rate fee for your transfer.
Other companies like WorldRemit, InstaReM, and XE will offer you an exchange rate that is a small percentage higher than this rate, some with no additional fees and some with an added set charge. The difference between the two rates is called the exchange rate margin, and the amount charged may differ from one currency pair to another. For instance, WorldRemit charges a GBP/USD margin of 1.29% and InstaReM charges 0.16%. This means that for your £2000 transfer to the US, WorldRemit will charge £25.80 while InstaReM will cost £3.20 more than any stated fees.
While this may sound expensive for sending your money abroad, it’s important to note that both these rates compare favourably when transferring money using banks. Lloyds bank states that its exchange rate margin is 3.55% for transfers of between 0 and £25,000, whereas HSBC’s margin is about 3.6%. Again returning to the £2,000 transfer, on top of the fees charged by each bank, you’ll be losing £70 and £72 in exchange rate markups with Lloyds and HSBC respectively.
Money transfer providers will almost always offer more favourable exchange rate markups than banks – usually adding on a percentage between 0.5% – 2% compared to 3 – 5%!
All money transfer providers will charge you for the cost of using their services to send your money abroad. What’s key is finding out exactly how much you can expect to be charged for your transfer. Some providers charge a set fee on top of the current exchange rate, whilst others will charge a percentage-based fee. This can also differ depending on where you are sending the money and on the size of your transfer.
For example, let’s assume you want to send money to Australia from the United States. Depending on the bank or online money transfer provider you choose, you’ll find a range of fees being charged to transfer money overseas. Online providers tend to come in cheaper than banks. For example, WorldRemit will charge you a flat fee of $3.99 to send any amount to Australia from the United States, whereas XE charges zero fees, and TransferWise charges a variable percentage fee depending on the size of your transfer. For instance, sending $1000 to Australia using TransferWise will cost you $9.03 in fees while $1500 will cost you $13.
When looking at the fees charged by banks, it’s common to find the rates varying depending on the currency in which the transfer is processed. For instance, a transfer of $1000 from Chase Bank to the Commonwealth Bank of Australia will cost $5 if it is processed in Australian dollars, but $40 if sent in USD. On top of this, the Commonwealth Bank of Australia will charge the recipient A$11 to collect the funds. These fees are in addition to correspondent and intermediary fees where applicable.
It’s important to make sure that the provider you are looking at can actually support the transfer you are looking to make – both facilitating transactions between the countries you’re sending from and to, and supporting the relevant currencies.
Money transfer providers allow their customers to send funds only from specified countries and currencies to their recipients in designated markets. Normally, a provider would make its sending and disbursing network coverage public, but this is not always the case. However, you can find out from the provider’s customer support team, FAQs section or by trying out a transfer if your sending and receiving countries are supported on the platform.
Some providers are more equipped for transfers between particular countries (known as currency corridors), and can offer much faster transfer times and others, so this is a good factor to compare!
Whether you are making a small or a large transfer, nothing beats good customer support. It is not unheard of to experience technical issues such as transfer delays, unexpected fees and transfer payment challenges, and so choosing a service where you can quickly get any questions answered is essential.
Some providers have online support teams available through live chat services, others can be reached through email and telephone 24/7 or during specific times. Ensure that you always have your transaction reference details for prompt assistance.
Would you prefer to be able to go somewhere to make your transfer, or would you prefer to access your transfer via an app? A large majority of money transfer providers do now have free mobile apps to allow customers to transact on the go for added convenience, but it’s worth noting that some providers only work through their online platforms or have restrictions to their apps.
Having access to money transfer services on mobile does give you an additional level of convenience and speed when transferring funds – but for some, the ability to make a transfer in person is desirable (for example, if you’ll be making cash transfers frequently). You will also find that some companies such as Ria, Western Union, and MoneyGram support both online and bricks-and-mortar transfers. Depending on where you are sending your funds, you may be able to begin your process online and complete it at a physical shop.
For some people, having a physical location for customer support and cash transfers may still be a top priority – however, apps make transferring your money internationally faster, easier, and instantly accessible even when you’re on the go, so they’re a great feature to look out for.
For you to send money through any online money transfer provider, you first have to open an account. The procedures for setting up an account, including the information required, vary from one provider to another. Some will ask you to provide proof of your identity and address before completing the process. Others will allow you to send a limited amount of funds and only lift the limits when proper verification has been done.
How you pay for your transfer is also an important factor to look at when choosing the best way to send money abroad. Most providers allow for bank transfers, ACH, and credit/debit card payments. There are also country specific payment methods including Google Pay, Apple Pay, and POLi that you can use depending on where you are making your transfer from.
Much like with payment options, providers also have various payout options including direct-to-bank deposits, mobile transfers, and cash pickups. When sending money to recipients without access to formal banking services or when transferring small amounts, cash pickups and mobile deposits are most preferred, but be sure to ensure your chosen provider offers both the payment and collection methods you require.
The answer to this question will change depending on the countries involved, and the easiest way to find out the service that works best for you is to use our comparison tool.
The ideal approach to find the best way to transfer money is always to choose the provider with the lowest overall transfer cost – although in some cases, time may take a higher priority over cost. Take a look at our list of the top 10 money transfer companies to help you make the best decision depending on your needs. Some of our top-rated money transfer services included OFX, WorldRemit, and Transferwise – but again, the suitability of these companies depends on your individual circumstances.
Below, we’ll take a look at the best way to send money abroad from the United States, Australia, and the UK.
When sending money to the United States, one of the most frequent transfer pairings is from the United Kingdom to the United States, so let’s have a look who gives the best value for transfers between these two countries.
If you were looking to transfer £1,000 from the UK and to the US through Santander UK, for example, you’ll pay a flat transfer fee of £25 on top of a margin above the current mid-market exchange rate of around 3.9-4.10%. In total, you would be looking at paying between £39 – £41 to transfer £1000 – and that’s not including the additional charge the receiving bank in the US is likely to charge your recipient (around $15), taking the overall transfer cost to around £50 in total.
In comparison, an online money transfer provider can typically provider much more favourable fees. For the same transfer, Transferwise could charge a £4.44 transfer fee with no exchange rate margin, while WorldRemit would charge a set fee of £2.99 and an additional margin on the exchange rate of around 1.05% for a total charge of £13.04.
It’s clear, then, that using online money transfer platforms is the best way to save money when transferring from the UK to the US. However, this can differ depending on the amount sent, so use our comparison tool which compares the best providers for sending money abroad.
We can see the same trend looking at making a similar transfer from Australia. Let’s assume you are making a transfer of A$1000 to the United States. If you decide to use Westpac, you’ll pay a transfer fee of A$10. If you use Westpac Live Online Banking, and A$32 for branch transfers. The margin Westpac adds on top of the mid-market rate is about 4.76%. For your A$1000, this margin translates to A$47.60, meaning the overall fees add up to between A$57 and 80 – nearly 10% of the amount you’re transferring.
If you decide to use providers such as InstaReM, TransferWise, or WorldRemit for the same transfer, you’ll notice almost immediately the difference in exchange rates and transfer fees. Sending through TransferWise will cost you A$6.56 with no exchange rate margin charged. WorldRemit charges A$3.99 and a margin of just 0.52%. InstaReM charges A$3.50 in transfer fees.
All this means that when using an online money transfer service to send money to the USA from Australia, the overall fees for a A$1000 transfer won’t go over A$10 which is clearly a better way to transfer money.
Finally, let’s look at the fees and exchange rate margins you can expect when transferring money to the United Kingdom from abroad. Take an example of a transfer of $1000 to the United Kingdom from the USA. If you were to choose a bank such as Bank of America, they will charge you a flat $35 if you are sending money in foreign currency and $45 if your transfer is in USD. On top of this, Bank of America applies an exchange rate margin of 3.4%, meaning the total fees and charges you pay on your $1000 transfer is around $70-80.
For the same transfer, WorldRemit will charge you a $2.99 fee and a margin of 2.78% on top of the mid-market rate. TransferWise is similarly cheaper, charging you a $9.04 fee and zero exchange rate margin – meaning they’re generally a better option if transferring a large amount of money. If you use InstaReM, you’ll pay a fee of $5 and a margin of 0.48%. So the fees you’ll pay on your $1000 transfer with WorldRemit, TransferWise, and InstaRem are $30.79, $9.04, and $9.80.
To find the best way to send money online and to know exactly how much your recipient will get when using the different providers and banks, you can use our comparison tool. Nothing beats the knowledge that the provider you are choosing for your next transfer is the fastest and the most affordable.
For the best experience when sending money to any country or even locally, you have to play by the rules set by each provider. Failure to abide fully by their requirements may cause unnecessary delays or even transfer cancellations. Below are some of the best practices to follow when making your transfers.
Overall, it’s fair to conclude that the best way to send money online will almost always be an online money transfer service rather than an established bank – but again, this entirely depends on your specific transfer needs, so there will never be one set answer.
The variety of money transfer services on offer helps keep their fees and exchange rate margins low, saving you money and ensuring the maximum amount of your transfer possible reaches your intended recipient – but the differences in rates, speed, and more between companies means comparing your options is always a sensible habit.
Depending on where you’re transferring money from/to, the currency pairing your transfer needs, and the amount you are sending, the total fees and charges will be different for each provider. It’s only by comparing the options that you can truly find the best way to transfer money overseas.
That’s where we come in.
Our easy-to-use money transfer comparison tool can lay out your options clearly for you in seconds, so you can quickly find your best money transfer option. Click the button below to start your comparison and find the best deal for your transfer!