International Money Transfer fees to know about…
07 Nov 2016Australians send more than $2 billion overseas every year, but the cost of sending that money can be steep. Here are some fees to be aware of.
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When exchanging many thousands of dollars into a foreign currency, in most cases the exchange rate is going to be the biggest hit to your transfer. But there are some other potential international money transfer fees that you need to be aware of. If you need to transfer money regularly, these can add up fast – so it pays to do your homework. Some of the common fees to watch out for include:
| A sending fee | This can go under many names but is essentially the fee that your financial institution will charge in order to send the money – either via a bank branch or online – to an overseas account. |
| A receiving fee | Financial institutions may also charge you for the privilege of receiving funds from overseas into the nominated bank account. |
| Cancellation fee | You might also be charged cancellation fees if the transaction needs to be cancelled for any reason. |
| An amendment fee | Similarly, if a change of payment details is required, there may be a cost attached. |
| An enquiry fee | Should you need to follow up with your bank to ensure that the funds arrived safety, this may elicit another fee. |
In Canstar’s 2016 International Money Transfers star ratings assessment, we found the following minimum, maximum and average fees across the 19 products assessed for the rating:
| Sending fees | Cancel fee | Amendment fee | Enquiry fee | ||
|---|---|---|---|---|---|
| Online | Branch | ||||
| Minimum | $0.00 | $20.00 | $0.00 | $0.00 | $0.00 |
| Maximum | $30.00 | $35.00 | $32.00 | $30.00 | $30.00 |
| Average | $16.29 | $29.00 | $20.61 | $15.53 | $16.37 |
| Source: Canstar International Money Transfers Star Ratings 2016 |
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Another cost of sending money overseas…
Another potential fee to watch out for is the fee charged to send money from one financial institution to a completely different one. Fees are easy to predict if the money transfer is sent and received by different branches of the same bank. They are much more difficult to unravel if your bank sends to a third party though!
The third party institution fee is charged to send money from the transfer institution to the recipient’s banking institution. For example, if you’re sending the money through your account at Citibank, and the other person is with a different bank, your institution may charge you a fee. But if you’re both with Citibank, no worries, no fee! The cost of this fee varies between institutions. You should do your research and inquire about how much institutions charge before signing up to make a transfer through them.
Hot tip: A little bit of homework goes a long way when it comes to exchange rates and transfer fees, so you should compare your shortlist of institutions before picking one. Every institution costs something, but you can make sure that more of your money goes where it should – to your recipient, not your institution.
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Why do people send money overseas anyway?
People send money overseas for lots of different reasons, including:
