What Platform should you choose when Sending Money Overseas?

Just as there is a wide range of people sending money overseas, there is as wide a range of options. It makes sense. After all, a business will inevitably have different needs to an individual. Nonetheless, banks and other financial institutions are all clamoring for your patronage, and choosing the right option can be confusing.

Think about the following…

  • someone buying a property abroad will need to send around US$100,000
  • small to medium enterprises (SMEs) and online retailers need to move around US$10 to US$20 thousand a month
  • expats transfer about $1 to $5 thousand a month
  • while migrant workers send home sums of just hundreds of dollars every month

A $10 fee might mean little when you’re transferring tens or hundreds of thousands, but will be a significant blow if you’re sending a few hundred.

Having trouble which platform to choose when sending money overseas?

Having trouble finding out what to use when sending money overseas?

The following are the 6 most common ways people send money overseas. Let’s compare their pros and cons so that you can find the best option for your needs.

  1. Paypal

PayPal is one of the biggest and most convenient options for quick payments of small sizes. Many online retailers offer it as the main payment option, as it makes paying easy for their customers. Also, banks in many countries allow their members to link their cheque accounts to their PayPal accounts, for quick and easy withdrawals of income sent through PayPal.

However, PayPal’s convenience comes with a price. They charge a basic fee of 2.9% of the sum transferred, plus US$0.30. This fee goes to the sender, but they can pass it on to the recipient depending on the agreement made between the two parties. In addition, PayPal adds a massive 2.5% exchange rate markup.

So if you’re transferring US$100, you’ll pay $3.20, and an extra 2.5% of whatever the current exchange rate is.

  1. Skrill

Skrill offers a similar service to PayPal’s. Their focus is on low-cost international money transfers. However, depending on the amounts being transferred, their fees can be equivalent or even more than PayPal’s. Withdrawals to bank accounts cost between €3.95 to €5.50. In addition, they charge between 2.99% and 3.99% (depending on currency) for currency exchange.

By the way, Skrill has a promotion until July 31, 2016, where you can send money to the Philippines, Indonesia, Sri Lanka, Armenia, and many others, for free.

  1. Bank wire transfers

Bank wire transfers (or electronic funds transfers) are the simplest way to send money between bank accounts within the same region. They’re used to pay bills or send money between family with ease.

Internationally, the process is not much harder. The sender just needs a reference code for the recipient’s bank, in addition to the account details. But although local wire transfers are cheap, international transfers can be significant. In general, a transfer from the US will cost US$10 to US$50. In addition, they charge exchange rate markups of 1.5% to 3%.

4. FX companies

Foreign exchange (FX) companies offer the most practical and affordable alternative for money transfer. World First, a hugely popular FX company located in Millbank Tower, London, UK, offers one of the best services. They charge a flat rate of just US$10 for transfers from the US and don’t charge for transfers from Europe or the UK. Seeing as their minimum transfer is US$1,000, that $10 fee is incredibly low. Furthermore, their exchange rate charge is limited to under 1.5% no matter how big or small the transfer is.

FX companies are excellent for property buyers and SMEs who transfer large volumes. They’re also great for expats who transfer more than US$1,000 a month. However, overseas workers sending remittances back home will generally have little use for FX companies, in the likely event they’re sending small amounts home every month.

5. Walk-in, Cash to Cash Money Transfer Centers (Western Union, Moneygram, etc.)

For migrants and those who work overseas who don’t have bank accounts, these money transfer centers offer a convenient option of sending cash between their branches around the world. The sender just deposits their cash at a branch in their location, and those back home can readily claim it from their local branch.

Unfortunately, the fees are very high. Considering the fact that those likely to use this service have few alternatives, however, it is generally used out of necessity.

6. Credit/Debit Card (prepaid or not)

When making a purchase from the other side of the world, find out if you can pay via credit card or a prepaid card (a safer option). Most likely credit card fees will be lower and the processing time and effort will be much more efficient than having to go to the bank to perform money exchange and transfer.


Whether you’re buying property abroad, taking your business international, living abroad or sending remittances home, foreign transfers can cost you hundreds or thousands of dollars. Choosing the right option can save you significant amounts. While FX companies are the best option for those to whom they cater, those sending small amounts or who don’t have bank accounts available have to settle for one of the more expensive options.

In order for you to save your hard-earned money when sending abroad, try not to send money too often, as the transaction fees and currency exchange spreads tend to pile up. Plan and pace your sending instead. Speaking of spreads, if at all possible, try to send money in the currency that you expect the other end to receive (for example, dollar to dollar, or peso to peso). This way, you’ll avoid the spreads or fees associated with having to convert the money you are sending.

Do you have your own preferred money transfer facility to add to our list? Feel free to comment, share your tips, or ask your question in the comment box below. Please also like us on Facebook and Twitter! Thanks!