Send Money To Canada

Canadians in the United States contribute the lions share (65.60 per cent) of remittances to Canada. According to a report by the Canadian Expat Association and Asia Pacific Foundation of Canada, there are more than 2.8 million Canadians in the diaspora. The United States alone accounts for slightly over 37.93 per cent of this population with Hong Kong coming second at 10.72 per cent.

Unlike many of South Asia or sub-Saharan Africa countries, Canada is not much a destination for remittances but a source of outflows. In 2017 alone, Canada received $1.34 billion in inflows against $24.56 billion in outflows mostly to China, India, Philippines, France, and Italy.

This guide explores the different options of sending money to Canada to help you make the right decisions. It also looks at the information you need when sending and receiving and the advantages of using money transfer services.

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How To Send Money To Canada

Sending money to Canada is simple and easy. Follow these steps to get started.

Find a Trusted Provider

Use our comparison table to find the best provider for your needs.

Sign Up and Deposit

Sign up with the provider and deposit the amount you want to transfer.

Transfer Money

As soon as you're ready, you can start sending money online.

Ways To Send And Receive Money In Canada

There are multiple ways to easily send and receive money in Canada but these will largely depend on the provider you decide to use. Below you will find everything you need to know about sending and receiving money.

    Ways to Send Money to Canada

    If you are a Canadian living abroad and looking for ways of sending money home, there are several options you can use. However, your choice of provider depends on your preferences and factors such as speed, cost, convenience, exchange rates and the like.

    Wire Transfer

    The Canadian banking system comprises domestic banks, foreign bank subsidiaries, and branches of foreign banks. In total, the banking network boasts of 6,300 branches and 19,000 ATMs.

    Sending to Canada via wire transfer takes anywhere from 3 to 5 days depending on the currency and the amount. Apart from the fees charged by the intermediaries, receiving banks also charge additional fees. This phenomenon makes wire transfer costly and unfavourable in exchange rate translations.

    Money Transfer Services

    Money Transfer Operators (MTOs) such as Instarem, WorldRemit, TransferWise, MoneyGram, Western Union, TransFast, and Xoom, have proven to be reliable in sending money to Canada.

    Transferring money using money transfer operators is very simple. You’ll be required to sign up for an account on the provider’s website or download an app and register an account. Then select the amount of money you want to send, how your loved one should receive it and how to pay for the transfer. 

    You can pay for your transfer using a debit or credit card, cash at the sending location, bank transfer or Interac, a Canadian interbank network. Once you’ve topped up your account, you can send through the provider’s website, mobile app or in-person at the store.

    Money transfer service providers take a much shorter time and have different sending options. The two main ways you can send remittances to Canada with money transfer services are:

    Transfer to Bank Account - Most MTOs take about two days to deliver your money. The process is similar to that of bank-to-bank transfers but varies slightly in that you’ll be transferring from an MTO platform to a bank account. Within 1 to 2 days, your loved ones will receive the money. Charges vary depending on the platform. 

    Transfer to Pick Up Location - Providers such as Xoom, a PayPal service, allows you send money to agent locations in Canada. Depending on the proximity of the recipient to a Xoom agent and their preference to receive money this way, you can send money using this method. Xoom has 761 locations in Canada while Western Union has 3,000 agent locations.

    Money Transfer services are usually better than banks in terms of fees and speed, if you would like to know more, we've created a simple guide to showcase the difference between money transfer providers and banks.

    International Money Orders

    Canada is one of the 30 countries that accept and cash international money orders. For you to send money from the United States to Canada using an international money order, you’ll need to visit any United States Postal Service(USPS) branch and purchase a money order. The cost per money order is $3.85 and the maximum value it can carry is $700 equivalent to CAD 999.99.

    Money orders are safe and reliable. They are prepaid hence have a guarantee that they won't bounce.

    Other methods of sending money you could explore include bank drafts, personal cheques and PayPal. Be careful to look at the fees charged, the length of time the transfer takes and the security of your money. 

    What’s Needed to Send Money to Canada

    Sending money to Canada is not a complicated process. However, you’ll be required to provide some information to facilitate the transfer. The information requested may vary from one provider to another and the method of sending the money. That said, here is a general list of what may be needed.

    • Your government-issued ID. Some providers insist that the document must have a recent photo.
    • Your debit card or credit card details if using this method to pay for your transfer
    • The amount of money to be sent
    • The recipient’s name as it appears on official documents
    • The recipient's address and phone number
    • The bank account number, the bank and branch name, routing number and BIC code

    The provider may require that you indicate the reason for the remittance. This measure helps to track money laundering and financing of illegal activities.

    What Are the Ways of Receiving Money in Canada?

    Canada is a well-developed economy with several options for receiving money. Once you do the transfer, you should send the reference number to the recipient. This number enables them to track the movement of funds.

    The recipient is notified through SMS or email when the money is ready for collection. There are two main ways your loved ones in Canada can receive the money you send them: direct bank deposits and cash collections.

    Direct Bank Deposits – If the recipient prefers to have money deposited into their bank account, you can use this method. It is safe and convenient. However, you need to ensure that the sender captures all the details to avoid delays or misdirected transfers.

    Cash Collection – You can opt to pick up your cash from an agent near you. This method is convenient when receiving small amounts of money. Call in advance to find out the hours of operation and bring a friend if you can. To avoid unnecessary losses, bank the money as soon as you receive it.

    If the sender uses a money order or bank draft, you’ll have to cash it in person at the post office or a partner institution.

    What Is Required to Receive Money in Canada?

    The following documents are required to enable you to receive money in Canada. Again, the information differs albeit slightly from one provider to another.

    • A government-issued ID. The name on the document should tie in with what the sender provided
    • The transaction reference number. You can obtain this code from the sender
    • Verification of the sender's details and the amount to be received

    Canada has a strict financial regulatory system. Depending on the amount and the frequency of receipt, the recipient may be required to provide more information. Bank transfers require no identification unless the amount deposited is suspicious.   

    Common Reasons for Sending to Canada

    Overseas Canadians send money home for various reasons. Some have families to take care of and others could be investing. The following are some of the top reasons Canadians abroad send money home.

    Paying Household Bills

    Canada has some of the best cities to live and work. However, the cost of living can be quite burdensome. Household expenses can take up to 50 per cent of salaries. Canadians in the diaspora with families to take care of back home send a sizeable percentage of remittances to cater for these expenses.

    Education

    On average the cost per year for an undergraduate program in Canada is USD 5,000 and for a graduate degree is about $5,500. For a household with insufficient income, this can be quite a lot of money. Remittances prioritise education to build human capital for the future.

    Mortgage Payments

    On average, Canadian mortgages have a 5-year term. However, it can take up to 25 years to pay off the entire loan. Some of the Canadians in the diaspora have mortgages they are servicing back home hence the regular remittances.

    Savings and Investment

    The North American financial and real estate markets are among the most complex yet teemed with opportunities. Canadians looking to build assets back home invest in financial assets like equities, bonds, and derivatives.

    Contributions to Social Causes

    Apart from family and investment reasons some of the remittances to Canada go towards social causes. These could be charity, wedding contributions, social support for the unfortunate in society and so forth.

    Why Send Money With a Money Transfer Service?

    As discussed earlier, there are various options available for sending money to Canada. However, money transfer services have stood out as the fastest growing and most preferred sending method. There are many reasons for this trend and below are some of them.

    Favourable Exchange Rates

    Money transfer service providers use mid-market rates to translate source currencies to the Canadian dollar (CAD). These rates are the best as they give you more Canadian dollars per unit of the source currency. You can also fix an exchange rate for a certain duration to safeguard your transfers against price volatilities.

    Ease of Setup

    Signing up for a money transfer service account takes a few minutes. The information you’ll need is just your email address and name. Some providers may ask for a one time I.D. verification and nothing more. This arrangement saves you the hours and days of setting up bank accounts and signing Know Your Customer (KYC) forms. Once the account is set up, you can top up and transact anytime anywhere.

    Low Transaction Fees

    The fees money transfer services charge can be broken down into two: payment method fees and the provider's fees. There is nothing much money transfer operators can do with the debit card fees, credit card fees, ACH fees, and wire transfer fees. These are third party fees. However, MTOs leverage their component of fees to offer their customers a low-cost sending advantage.

    Speed of Transfer

    Whether you are using a bank transfer or cash pick up option, money transfer operators offer the fastest transfer speeds. Cash pickups are available instantly while bank transfers can take a few days depending on the bank, day of the week, and the transaction creation time. When sending money for emergencies quick delivery is a priority.

    Multi-currency Support

    Irrespective of the country you are sending from, money transfer services will convert the currency for you to the CAD. Western Union and MoneyGram operate in 200 countries and territories which means you have the flexibility to send from any country. Xoom serves more than 130 countries including Canada.

    Secure Transfers

    Money transfer service providers prioritise security. They have invested in superior technologies and multifactor authentication security systems to keep their platforms hackproof.  Majority if not all of them are regulated by the Financial Conduct Authority (FCA) and/or the Prudential Regulation Authority (PRA). These authorities guarantee the safety of customer data and the transactions carried out.

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    Things to Consider When Sending Money to Canada

    The Canadian dollar is one of the top reserve currencies in the world joining the league of the United States dollar, euro, pound sterling, Japanese yen, and the Chinese renminbi. This fact shows the confidence other economies have in Canada.

    Notwithstanding the impressive profile, there are some things you need to consider when sending to Canada.

    • The United States-Canada Relations vs Trade Policies - The US and Canada have a tight trading relationship. In 2018, the value of their imports and exports totalled billions of dollars. With the United States pursuing aggressive trade policies against China, Canada could suffer from the spillover effects. This tussle may have a longterm effect on the Canadian dollar.
    • The Volatility of the Global Commodity Market - Canada is a commodity-dependent (oil and energy products) economy. According to a report by Unctad, the commodity market has been a mixed bag of fortune. Rises and falls have become more frequent and unpredictable. Investment opportunities tied to this market in Canada may become unpredictable in returns as well, inheriting nuances from the global trend.
    • Booming Real Estate Trade - New real estate projects coming up in Toronto, Vancouver and other big cities have continued to uphold the real estate performance in the country. Investors including Canadians living in the diaspora have an opportunity to invest in a low-risk and stable environment.

    Other than the above must-watch trends, Canadians in the diaspora must also keep a close eye on the actions of the independent Bank of Canada. The bank is determined to maintain inflation levels at 2% to stabilise prices. Therefore, when sending money to Canada, check and compare across the providers for the best deals in speed, rates, and fees.

    Looking to Send Money Somewhere Else?

    Sending money anywhere else in the world is as easy as sending money to Canada. If you're looking to send money to another country, here is the list of the most popular destinations.

    Jonathan Merry
    Written By
    Jonathan Merry
    Jonathan is the founder and editor of MoneyTransfers.com. Having previously worked in the FX trading industry and observing the ways money is exchanged to create wealth for traders, Jonathan gained a passion for how currency is exchanged. Using this knowledge he discovered a need for transparency and education to help people save money on their online transfer, leading to the creation of MoneyTransfers.com