There are numerous reasons for needing to send money overseas but it doesn’t really matter why you need to send money internationally, what really matters is making sure your money gets there quickly, securely and at the cheapest cost to you possible.
In recent years, there has been an explosion in internet banking and online payment technologies and you have more choice than ever of how and who to choose when you need to send money across borders. This guide will run you through the basics of international money transfers, also often referred to as IMT, so that you can compare your international money transfer options and feel confident in making a good choice for your next overseas transfer.
Here in Australia, you can use a bank or foreign exchange specialist to transfer money internationally. There are also options like Western Union and using PayPal for small transfers.
With banks you can organise a transfer by visiting a branch or you can also transfer money online via the bank’s internet banking platform if you are a customer.
There are growing number of online foreign exchange specialists operating in Australia which provide more competitively priced international money transfers. Mozo includes a listing and comparison of these providers to help you compare their rates, fees and features. As most of these IMT providers operate exclusively online, it’s good to know that all providers listed on our site are also regulated by ASIC.
When it comes to comparing international money transfers, the exchange rate should play a major role in deciding when and who you choose to use for your international transfer. Mozo compares all major international providers in the one place to help you to get a snapshot of the best rates and options for a range of currencies. See here for today’s rates.
In addition to the exchange rate, there are three “T's” that you’ll want to compare on:
Every international money transfer provider will have their own exchange rates and set of currencies that they transfer overseas. Mozo lists the 18 most popular currencies for international transfers in our tables including USD, Euro, Pounds, NZD, Chinese Yuan, Indian Rupee.
If you need to transfer to a more exotic currency, most international money transfer providers will be able to help, but you will generally need to phone them to discuss the exchange rate and fees. Also it generally takes longer for the funds to transfer to more exotic currencies so you should allow extra time for the recipient to receive payment.
Mozo updates the rates for IMT every hour, but it is still important to understand that the rate you will get for your trade may be different to the rate advertised at the time of your search. You need to allow time for you to set up your account and make your funds available for transfer.
While some people make a living by trading in foreign currency, it doesn’t mean that you need to become a finance pro to ensure you get a good deal on your international transfer.
A spot contract is the most popular type of transfer for people making personal transfers. A spot rate is when you book a trade and you get the exchange rate being offered at that particular time and day. Most international money transfer providers and banks will offer this service.
A forward contract allows you to lock in a rate now even though you may not need to transfer the funds until a time in the future. Not all international money transfer providers will offer this service and there may be a minimum amount that you will have to transfer or pay a deposit.
If you will be making regular payments to an international account with some international money transfer providers it’s possible to set up a transfer plan that allows you to limit your exposure to changes in rates.
Another option provided by IMT providers is a limit order. This allows you to set the exchange rate that you want for a particular order and when the rate hits that rate, you make the trade. It means you don’t have to continually check rates as you’ll get the rate you set. This service may not be available with every IMT platform.
Whether you are making a one-off transfer or you will be making regular transactions internationally, you will first need to set up an account with a bank or international money transfer provider. The good news is that most of the account set up can be done online, and within a few hours as long as you have the right ID and forms completed.
As soon as your account is set up you are good to go and make your first trade.
Head on over to our international money transfer page to compare today’s exchange rates and providers.International money transfer tips