Guatemala receives over $8 billion every year from other countries in the form of remittances. The United States is the major source of these inflows accounting for about 90% of the remittances to Guatemala. Other source countries include Mexico, Canada, Belize and Spain.
In 2017, close to 1.4 million Hispanics who self-identified as having immigrated from or traced their family ancestry to Guatemala lived in the United States. With annual personal earnings ranging from $23,000 to $35,000, most Guatemalans in the US can afford a decent living and even support their families back home.
Sending money from countries like the United States, Canada, Mexico and Spain to Guatemala requires awareness of the existing channels. Thanks to technology, a lot of the traditional transfer channels and their inherent inefficiencies have been improved and other transfer methods sprang up over time.
This guide will help you compare the different money transfer options available, how they are structured, their appropriateness and other considerations that you have to make. Let us dive right in!
Sending money to Guatemala is simple and easy. Follow these steps to get started.
There are multiple ways to easily send and receive money in Guatemala 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.
Money transfer operators and banks dominate most Guatemala remittance corridors. However, the specific players may change depending on the transfer route. There are three main ways you can send money to Guatemala.
Depending on your host country, you can make a wire transfer to a bank in Guatemala. For instance, from the United States, you can make a transfer through banks that have correspondents or branches in Guatemala. Look for banks like Bantrab, Banrural, Inter Banco, Citi Bank, Banco Promerica among others.
The banking system is reliable and safe. However, your transfer may cost you a little more to process. On average, banks charge between 25 to $40 to complete a wire transfer to Guatemala. Depending on the network of banks involved, the time to complete the transfer may extend even up to 5 days.
The other inconveniencing aspect with bank wire transfers is that both the sender and the recipient must have bank accounts. Some of the immigrants in countries like Mexico, Belize and Spain do not have the required documents to sign up for mainstream bank accounts. This barrier forces some of them to use informal methods to send money home.
Money transfer services with online access points such as Xoom, Pangea, Remitly and TransferWise can help you to quickly send money to Guatemala. These providers are fast, offer high exchange rates and low transfer fees. To initiate your transfer, you simply need to sign up for an account, have your details verified, pay for your transfer and send.
There are various ways you can pay for your transfer depending on the provider. Some of the common transfer payment options include:
The recipient in Guatemala may choose to receive the cash through a direct bank deposit or as a cash pickup. The choice depends on the sender-recipient preferences. The transfer fees charged are a fraction of what other channels charge. For instance, sending $1000 through Xoom to Guatemala will cost you $15.99 when you pay using a debit or credit card and only $4.99 if you pay using a bank transfer or PayPal balance.
WorldRemit charges $2.99 to send $1000 to Guatemala through cash pickup. The exchange rate margins that online money transfer service providers charge, range from 0.5% to 3.5%. Banks charge you upwards of 5%.
Apart from physical cash or bank deposits, you can also send the recipient airtime direct to their phones. WorldRemit and Xoom offer direct airtime top-ups to phones in Guatemala that are on Claro, Movistar and Tigo networks.
You do not need to have a bank account to send money through online money transfer platforms. This aspect has made these services accessible to many people.
Apart from the internet-based money transfer providers, there are agent-based money transfer operators such as Xpress Money, Vigo, MoneyGram, Western Union, and Ria. These operators require that you visit designated agents to deposit and make your transfer.
These operators are relatively fast and reliable. For instance, Western Union takes only a few minutes to transfer money from the UK to Guatemala. To transfer 1,000 GBP on Western Union, it only costs 9.90 GBP which is way lower compared to banks that charge up to 30 GBP.
MoneyGram allows for direct deposit into bank accounts and pickups from cash locations. You can send up to 6,000 GBP and the money will be available in minutes or within a few hours. Western Union and MoneyGram also have a feature where they allow their customers to initiate their transfers online and complete them in-store.
Depending on the provider you choose, you’ll be asked for some information and documentation before you can make your transfer. Online money transfer companies will ask for the information when opening your account. Here is what you need:
Online money transfers give you the convenience of sending money from the comfort of your seat as long as you have the required information.
Once you send the money, the recipient gets a notification that a transfer is on its way. There are two main ways of receiving money in Guatemala: bank deposit and cash pickup.
Bank Deposit- The transfer is made directly to the recipient bank account. As long as the sender keys in the right information including your Bank Identifier Code (BIC) and account details, you should have your transfers in one or two days.
Cash Pickup- If you use providers like WorldRemit and agent-based money transfer operators, you can receive your transfer in cash at a pickup location. Some of the pickup locations are independent stores and others are bank branches.
To receive your transfer in Guatemala, you’ll need the following information and documentation:
• Your national identity card or passport
• The transaction number -You can get this code from the sender or it may be sent to you by the provider through an automated system.
Some providers may require that you identify the sender and the reason for the transfer. Ensure you have this information on hand as well just in case it is required.
Remittances play a significant role in Guatemala. In terms of GDP, they account for more than 11%. The reasons behind these inflows differ from one remittance to another. Some of the common reasons include.
Most of the remittance-receiving households in Guatemala allocate remittances to expenses such as utilities, food and rent.
Whether it is paying for structured health plans or direct medical costs, some of the inflows are directed towards achieving health outcomes.
To keep their siblings and children in school, Guatemalans send tuition money directly to schools or indirectly through their families.
Guatemalans through national and private initiatives have investment forums through which they get information about investment opportunities back at home. Some of the investments are in equities and bonds and others in real estate.
Some of the Guatemalans abroad are in contractual employment subject to renewal. With such a work arrangement most of them periodically send their earnings back home as a precautionary measure just in case they decide to return home after the expiry of their contracts.
Money transfer services have an advantage over most if not all traditional forms of money transfer. Some of the outstanding advantages of these transfer services include:
In addition, providers hold customers funds in separate accounts from operating funds. This guarantees the safety of funds even when the money transfer company goes through financial headwinds.
When transferring money to Guatemala, there are a few things you need to consider:
With more transfer corridors to Guatemala opening up, knowing the best ways to send money to your family and friends is imperative. Ensure you compare across the different providers before settling on any money transfer operator.
Sending money anywhere else in the world is as easy as sending money to Guatemala. If you’re looking to send money to another country, here is the list of the most popular destinations.
Jonathan is the founder and editor of MoneyTransfers.com. Jonathan is highly experienced in the currency transfer market, having previously worked in the FX trading industry, alongside being an avid traveller. Using his knowledge he identified a need for transparency and further education to help people save money on their money transfers, leading to the creation of MoneyTransfers.com