If it’s your first time sending money overseas, then you might have been researching about the best way to do it. And since international money transfers can appear to be a complicated process, myths and misconceptions are bound to arise. But in reality, they’re not that tricky! That’s why we’ve gone ahead and debunked the top five common myths about international money transfers.
Myth One: It's time consuming to organise
There’s a common misconception that when it comes to banking, it usually involves a stack of paperwork, followed by a million forms to fill out. But this line of thinking couldn’t be more old school. If you do need to send money overseas, you’ll find that all IMT providers need is basic personal information and a few documents to verify your identity. Once your account is set up, you’ll then be asked to provide the recipient's details before you can start sending cash. Easy!
Myth Two: The transfer time can take weeks
It’s a fair thought, especially if you picture a carrier pigeon bundled down with cash when you think IMT. So it might surprise you to know that just like a regular bank transfer, an international money transfer can take between 2-3 business days to reach your recipient. However, there are some circumstances where it could take longer, like over a public holiday or the processing systems in place at the country you’re sending the money to.
Myth Three: It's only used to send money to loved ones
International money transfers are commonly used to send money to loved ones for either their birthdays, Christmas or other special occasions. But you probably didn’t know that international money transfers are also used to pay for mortgages and buy big ticket items like cars or boats. Why not buy items like that in Australia I hear you may ask? Well, the most likely answer is because there may be cheaper options overseas.
Myth Four: Online foreign exchange specialists are riskier than banks
Another common misconception is that banks are the most secure place you can go when it comes to handling money. This line of thinking could see you miss out on serious savings! A survey conducted last year found that Aussies transferring $1,000 to the US could save up to $40 by using an IMT provider instead of their bank.
And when it comes to the safety of your funds, rest assured online agencies have secure systems put in place to safeguard your money. Plus, foreign exchange agencies are monitored by regulatory bodies and undergo regular audits, just like banks.
Myth Five: You'll get the same rate everywhere you go
I mean the exchange rate is the exchange rate, right? Correct, but there are some factors that differentiate the exchange rate among providers.
While there is no changing the exchange rate, providers will add an amount on top in order for them to make a profit - the margin rate. That’s why it’s so important to take the time to compare foreign exchange providers to not only ensure you’re getting the best bang for your buck, but will be paying as little in the way of fees as possible.