Should You Send Money to Canada Through Your Bank?

Sending money to Canada through your main street bank account may sound hassle-free, but how do the cost and service compare to that offered by specialized money transfer companies? Our useful guide compares the fees and rates charged by both and breaks down some of the financial jargon, taking you through the process in layman’s terms. Read on to discover the best option for your US to Canada remittance.

At a glance

The Cost of Sending Money to Canada Through Banks vs. Money Transfer Providers

The Cut-Off Times When Sending Money to Canada

Should You Send Through Your Bank or an Alternative Provider?

References

The Cost of Sending Money to Canada Through Banks vs. Money Transfer Providers

There are two main costs that you’ll face when sending money to Canada from the United States and these are the exchange rate margin and any associated transfer fees.

The exchange rate margin is simply the difference in percentage between the interbank rate, a rate that large banking corporations use when sending money to each other, and the rate at which currency is sold to you and me. The interbank rate is sometimes referred to as the mid-market rate.

As the USD to CAD currency pairing is commonly used for both trade and for sending money to friends and family members across the border, it would be typical for this exchange rate margin to be less than 3% over the interbank rate. At the time of writing (Sep 26, 2022) WorldRemit has an exchange rate margin of 2.25%.

Banks are often less transparent about their exchange rate margins and a few will only make their currency converter available to account holders. However, as of Sep 26, 2022, Wells Fargo and Bank of America both had an exchange rate margin of 5.42%, and Chase Bank of 3.42%.

This means that if you were to send USD 1,000 to Canada with WorldRemit, your family member would receive USD 1336.05 CAD but with Wells Fargo or Bank of America they would receive just USD 1290.50 CAD – that’s USD 45.55 less in their pockets!

Unfortunately, exchange rate margins aren’t the only cost associated with transfers. Banks and money transfer companies also charge a transaction fee for initiating the remittance. The table below highlights the charges each provider levies for sending money from the United States to Canada when using bank transfers.

Provider	Cost	Time
Chase Bank	There is a USD 5.00 fee or no fee if sending over USD 5,000.	1-2 days
Bank of America	According to their website there are no fees for international wire transfers (although documents elsewhere state USD 35)	1-2 days
Wells Fargo	Fees are disclosed at the time of the transaction but range from USD 35-40.	1-2 days
U.S Bank Corp	USD 50 for personal account holders. USD 70 for business account holders.	1-3 days
CitiGroup	These range from USD 0-35 depending on your account type. View our Citigroup guide for a breakdown.	1-2 days
WorldRemit	USD 2.99	Instant

As you can see from the table it isn’t unusual for banks to charge up to USD 50 in fees for processing a fee, while WorldRemit has a maximum fee of USD 2.99.

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Sending Money to Canada through Banks Pros and Cons

Pros

In Person: If you don’t have access to the internet or would rather be guided through the process by a cashier, the in-person service offered by banks can be useful.

Safety and Security: Banks have several security protocols in place, and you can be sure that your money is in safe hands when transferring it through your bank.

Cons

High Exchange Rate Margins: With exchange rate margins that exceed 5% there is a higher price to pay when using a bank for your remittance.

High Transfer Fees: With banks charging up to USD 50 to transfer your US Dollars into Canadian Dollars, the cost of your transfer can soon add up.

Lack of pay-out options: With banks, remittances can only be received via bank transfer whilst money transfer companies offer a differing range of payout options from mobile airtime to cash pick-ups.

Sending Money to Canada through MoneyTransfer Providers Pros and Cons

Pros

Low exchange rate margins: With an exchange rate margin of 2.25% on the United States to Canada route, money transfer companies, such as WorldRemit, tend to offer far better exchange rates than banks.

Low transfer fees: The highest fee you’ll pay with WorldRemit on a USD 1,000 USD/CAD transfer is USD 2.99. This is more than fifteen times less than the fees charged by US Bank Corp.

Fast: Most remittances sent from the US to Canada arrive instantly.

Cons

Limited Pay-out options: WorldRemit only offers bank transfers on transfers between the United States and Canada, while other routes have more pay-out options available.

Limits on large transfers: WorldRemit imposes a maximum sending amount of USD 10,000 per transfer.

No live chat option: WorldRemit does not offer a live chat channel for customer service; instead, users can use an online form, email, or phone to contact someone.

The Cut-Off Times When Sending Money to Canada

Unfortunately, banks, unlike money transfer companies, aren’t open 24 hours. This means that wire transfers are only processed during bank opening hours and then can take up to two working days to arrive.

Banks have daily cut-off periods and any remittances received after this time will be processed the next working day. This means that a remittance sent after the cut-off period on a Friday afternoon will be processed on Monday morning and will arrive with your recipient on Wednesday. Although any bank holidays taking place in Canada or the United States during this period can also affect the arrival time of your remittance.

The following table displays the cut-off time for the five main banks in America and WorldRemit.

Provider	Cut Off Time	Delivery Time
Chase Bank	16.00 (EST)	1-2 business days
Bank of America	17.00 (EST)	1-2 business days
Wells Fargo	17.00 (EST)	1-2 business days
US Bank Corp	16.00 (EST)	1-3 business days
CitiGroup	17.15 (EST)	1-2 business days
WorldRemit	24 Hours	Immediate

More money transfer guides in Canada

How do money orders work in Canada?Canada Deposit Insurance Corporation (CDIC)Financial Consumer Agency of Canada (FCAC)Financial Transactions and Reports Analysis Centre of Canada (FINTRAC)Investment Industry Regulatory Organization of Canada (IIROC)

Should You Send Through Your Bank or an Alternative Provider?

While banks are reliable and offer a secure service, the excessive exchange rate margins and extortionate transfer fees should be enough to put anyone off using them to transfer money between the United States and Canada. Money transfer companies can not only carry out your transfer at a far more competitive rate but also offer a speedier service when compared to the slow transfer times that banks bestow on customers. Why not look at our USD/CAD real-time comparison table to find the current best rate for your remittance.