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How to send and receive bank payments from abroad?

Bank payments can be likened to money. They are the digital form of traditional bank paper checks. Bank payment authorizes a person to withdraw money from your account as with a check. And these days, most businesses now engage in international activity. Not only is it risky to carry a paper check worth billions of dollars in your purse to a bank, but it is also worse to cash it out and arrange it in a bag. That’s why many businesses (and individuals) prefer to send and receive money through digital means. 

In this guide, we would provide you with the alternatives providers to use in sending and receiving bank payments.

The Most Expensive Method: Bank-to-bank Transfer

We tagged this the most expensive method because, well, it is. Bank-to-bank transfer is the use of bank transfers to send and receive bank payments. We can understand why many people use this medium because it is the most direct form. To send a bank payment, use a bank, duh! To do this, senders would go to their bank’s branch (or do it online through internet banking), provide the needed details, and send. The receiver would have to know your bank details (full name, bank account number, sort code, and SWIFT code) to receive the money from his/her bank. Easy right?

However, this is extremely expensive because of the hefty fees that would be deducted from the money during sending and receiving. Imagine sending $100,000 abroad and half the money’s gone on transfer fees and exchange rates. That’s why we have alternative providers. These providers make sending and receiving money from abroad a breeze. To get a better understanding, watch the video guide provided.

Alternative Providers: Money Transfer Companies

Money transfer providers are companies that are involved in the business of sending and receiving money (and bank payments) between different countries and involving different currencies. Their fees are generally lower than that of banks, and they don’t require as much information as banks do. Instead of the lengthy and technical paperwork, money transfer companies might require just a few details. 

You can also send money after you have just opened an account with them which is not the same for banks. You would require to have opened an account with the bank (for a while) before you can begin to send money internationally. Another advantage is that money transfer companies send your money quicker than banks, and are more flexible for smaller transfers. They also offer a good deal when it comes to large transfers.

There are many money transfer companies with different business structures and processes, however, the same thing applies to them when it comes to how to send money abroad. 

How to Send and Receive Bank Payments from Abroad?

Though there are many money transfer providers in the world today (and many more are being developed and upgraded), the method of sending is similar to them all. Below is a step-by-step guide on how to send and receive bank payments from abroad. Or, if it’s easier, you can watch a quick video guide about international banks payments.

Step one: Open an account with the money transfer company of your pick (if you haven’t already) through the desktop website. 

Step two: Complete the registration process by filling in your personal and bank details.

Step three: Include photos, signatures, and other requirements to verify your identity. This is done to reduce and prevent cases of fraud

Step four: Now, you can place your order using the mobile app or the desktop website. Ensure to look into the fees (which would be briefly explained in the section below), the exchange rates, and the time frame for sending the money. Then set the terms as you would desire and hit next.

Step five: Input the receiver’s contact details. Money can be received through bank transfer, cash pickup/delivery, online wallets, or mobile airtime top-ups. Therefore, depending on the method of collection, the appropriate details would be requested. They could include name, bank account number, Bank Identifier Code, Home address, mobile number, and so on. 

Step six: From your bank account, make the payment to the money transfer company.

Step seven: Track the transfer progress on your app or the website or via email

Step eight: Finish the transaction when the receiver has collected the money. 

Things you might need to know

Here are a few things you still need to know such as the fees (we promised to mention that), the exchange rate, the time frame, and so on. 

Understanding the fees

The fees that eat into the money sent or received include the sending fee, transfer fee, receiving fee, and exchange rate. Relax, they aren’t expensive - most of them. 

  1. Sending fee:This is the fee that is charged for sending the money abroad. Using an analogy, if you want to send $500 and your sending fee is $20, then you would have to pay $520. The company keeps $20, and $500 goes to the receiver. Simple right? Some companies charge their sending fees in the percentage of the money to be sent, while others have a fixed fee for a range of amounts (that is, $70 for $0-$1,000, and $100 for $1,001 to $5,000 for example). However, not all companies charge a sending fee.
  1. Transfer fee:This is the term mostly used to address sending fees. 
  1. Receiving fee: This is the amount of money the receiver would pay to collect the money. Some companies charge both transfer and receiving fees, while others charge only a transfer fee, and the rest charges nothing at all. Sometimes, receiving banks are the ones that charge a receiving fee instead. Again, this can be placed as fixed prices or percentages. 
  1. Exchange rate: This is the difference in value between two currencies. Therefore, when converting from one currency to another, the exchange rate is used to fix a price. Many companies use transparent exchange rates (while a few others add their percent). Keep an eye out for the one with the most transparent fees. 

How long does it take?

Generally, it takes less than a week to send and receive money using money transfer companies. While some take about 1-3 days, some take as long as 3-6 working days. Some companies even transfer money within 24-72 hours. 

Final tip

To maximize the avenue laid out, it is best to compare money transfer companies before choosing one. No company can suit your transfer needs 100%. However, you can always find one close to your heart. Double-check exchange rates, and remember to watch the video (if you haven’t) for more information.