Tips And Traps: 5 Things You Should Know Before Sending Money Overseas

7 November 2016

There are some things you should know before sending money overseas, in order to make the most of the competition for international money transfers. 

The currency market is the most liquid market in the world, with major currencies traded on the foreign exchange 24/7. It is a competitive market but it is far less understood than the share trading market, so we’ve gathered our best simple tips and traps for you to make the most out of an international money transfer.

Things you should know before sending money overseas

1. Exchange rates are everything


The currency exchange rates reported nightly on the news are wholesale or inter-bank rates, which means they’re not exactly the rate you will get when you make an international money transfer. Currency suppliers make their profit through the margin added to this wholesale rate – and that margin can vary considerably between suppliers. Some will give you less for your exchange and will charge you more to buy it, so don’t ignore the exchange rate.



There are ways to make fluctuating exchange rates work in your favour, such as the budget rate. This is when you preset or pre-order a money transfer to be sent when the exchange rate hits a pre-determined amount you have selected.

You can set a pre-order desired exchange rate both ways – a maximum desired rate, and a minimum desired rate. This limits your losses if you need to make a payment but the exchange rate is going against you.

There’s also another way to protect yourself against currency volatility: forward contracts. This is more important to understand if you are making a large transfer such as buying a house overseas, rather than simply sending a gift of a thousand dollars or so to a loved one.

Forward contracts allow you to lock in today’s exchange rate for the transfer to be applied at the settlement of the contract, protecting against negative price movements in the meantime. There are pros and cons, as with anything. The downside is that exchange rates might go up in the meantime and you would miss out.

2. Don’t pick your own bank by default

Online payment

Don’t discount non-bank foreign exchange providers. Banks can typically be more expensive than online foreign exchange specialists; however, they are a very convenient option, since you may be able to use your existing online banking account rather than opening a new transfer account.

For infrequent transfers, the convenience may outweigh the cost difference. Also, there may be a minimum transfer amount that may be more than you want to spend – $500 is a common minimum.

Regular and high volume transfer customers, however, will likely benefit by comparing other specialist providers.

Choose between the different methods for making an international money transfer here – you can make a transfer on your smartphone, online, or in-store at a branch. Then compare your options for providers of international money transfers using our comparison website:



3. Avoid instant money transfers

An instant money transfer (IMT) is an online international money transfer where you can send money instantly to someone in another country, using just their mobile phone number. It is useful when your recipient does not have a bank account, or you don’t know their bank account details. The recipient of the money receives an SMS text message with a bank-generated code giving them authorisation to withdraw money from an ATM or branch.

But transferring money overseas at such short notice is definitely expensive! An IMT transfer also expires if the recipient is not able to use it right away.

By comparison, standard international money transfers can take anywhere between 2 – 6 days, and some providers even say it can take up to 10 days depending on the destination. But it’s less expensive, and discounts are even available for bulk orders. So the smart way is to consolidate small, regular payments, to save on exchange rates and fees.

As a rule of thumb, the more exotic the location, the longer it may take. For example, sending $1,000 AUD worth of USD to the USA will take less time than sending $1,000 AUD worth of Polish zloty to Poland.

Institution Maximum Delivery Time of Transfer
ANZ 72 hours / 3 days
Arab Bank Australia 72 hours / 3 days
Bank of Melbourne 240 hours / 10 days
Bank of Sydney 72 hours / 3 days
BankSA 240 hours / 10 days
Bankwest 72 hours / 3 days
Bendigo Bank 48 hours / 2 days
Citi 120 hours / 5 days
Commonwealth Bank 120 hours / 5 days
Delphi Bank 72 hours / 3 days
HiFX Refer to Provider
HSBC 72 hours / 3 days
NAB 72 hours / 3 days
OFX Refer to Provider
St.George Bank 240 hours / 10 days
Suncorp Bank 120 hours / 5 days
TorFX Refer to Provider
Westpac 120 hours / 5 days
World First Refer to Provider
International Money Transfers Star Ratings 2016

4. Don’t be afraid to negotiate

Negotiating better prices

While you cannot control the exchange rates or fluctuating market movements, you can negotiate – and you might be surprised at the outcome. Ask about getting a better deal, particularly if you have the leverage to say that you frequently make large money transfers.

You can often find multiple currency exchange branches and banks along the one street in your city’s CBD. It means you have the negotiating power to keep walking between the different providers saying, “So and so down the road can give us this rate. Can you do better?” Eventually one should offer better exchange rates than everyone else, with less fees applied than anyone else, and you’ll know you’ve found a winner.

5. Shop around for the best international money transfer

As with all financial products, shopping around is likely to save you a lot of money. Most banks and companies dealing in currency exchange are keen to differentiate themselves from their competition, and may offer incentives such as tiered rates or no fees.

Find out more about the varying cost of international money transfers here and read about the fees you should expect here. In 2016, we rated 19 different providers, so there’s plenty of competitive offers out there.

Canstar annually researches and rates the international money transfers available to be sent from Australia to various countries around the world. Use our website to compare your options for the country of your choice:


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