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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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.
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.
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.
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.
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.
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.
The provider may require that you indicate the reason for the remittance. This measure helps to track money laundering and financing of illegal activities.
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.
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.
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.
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.
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.
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.
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.
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.
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.
The cheapest way to send funds to Canada is through OFX. OFX does not charge any stated fees, and their hidden currency conversion costs are very low when compared to the competition.
It should be noted that with OFX, you must send a minimum amount per transaction, and to achieve optimal savings, you should send more money at once. OFX has conversion rates that start around 1% if you’re sending the minimum. From here, the more money you send at once, the closer you get to their lower 0.4% rates.
If you need to regularly send smaller payments, then TransferWise is a close contender for the second cheapest way to send funds online to Canada.
The easiest way is through TransferWise. With TransferWise, you only need to complete a few quick steps in order to send money. First, you just tap the amount of money that you need to send, then tap in the destination. After that, you just pay TransferWise, and they send your money to its Canadian destination. The transfer is completed in one or two days.
The fastest way to send money online is through Ria Money Transfer’s fast service. This is the cheapest reasonable option you have if speed is your primary concern. With Ria Money Transfer’s fast option, you can expect your money to reach its Canadian destination in a matter of minutes. Ria money transfer also offers rather competitive rates when compared to their slower competition.
The overall best way to transfer money online to Canada is through TransferWise. With TransferWise, you have a generic option which is cheap, exceptionally easy, and somewhat fast. The peer-to-peer system can be used simply and securely as well. These reasons and more make TransferWise the overall best way for Canada money transfers.
The current exchange rate for the Canadian Dollar (CAD) is 1.3067 CAD per American Dollar (USD). The CAD reached a high of 1.3306 CAD per USD, and a low of 1.2964 CAD per USD during the last 90 days. The average exchange rate for the CAD was 1.3154 CAD per USD during the last 90 days.
The average volatility of the CAD against the USD was 0.32% over the last 90 days. This is a fairly high volatility rate, and the CAD has been somewhat unstable for a few years. The CAD has continued to lose ground into 2019. Going forward, moderate fluctuations can be reasonably expected, barring any unforeseen circumstances.
What do we mean by the top provider?
The top provider is the money transfer service that we believe is the most suitable for the country you’re sending money to. In order to keep our service free we factor in the commercial agreements we have with partners into this ranking.
How do we choose providers to display?
We make sure that each table displays the most relevant brands to the country you are sending money to and from. We consider many factors when choosing the providers to display in the table.All of the providers we display are fully regulated to provide money transfer services in the jurisdiction you are searching, relevant regulatory authorities are the FCA, ASIC, Fincen, FINTRAC & AMF. Alongside being regulated the services are manually checked by our team for both quality of service and online trust from such platforms like Trustpilot and Google reviews.We base our rankings primarily on the quality of the service provided, the benefit to the consumer and to keep our service free - the commercial agreements we have.
How do we order our comparisons?
We are affiliated with some of the partners displayed in the tables. However, the order of the providers is based on the quality of the service for the particular country corridor followed by the commercial agreement in place. You don’t pay any extra and the deal you get isn’t affected by our commercial agreement with the money transfer provider. We may receive a commission when you click through to a listing or when you make a transaction.We aim to find the balance between the quality of the service, customer satisfaction and the commercial agreements we have, and continue comparing services in a transparent way.If you have any questions about our listings, please don’t hesitate to email us at firstname.lastname@example.org
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.