Australians are transferring more money overseas than ever before, but the hidden costs can be hefty.
If you have family or friends overseas, there’s a big chance you might need to send them money at some point. It could be to help them out with their daily life, share holiday expenses or to repay a debt.
Internet has made money transfers much easier, but there are still important things to know to avoid big fees or getting caught in a scam.
Transferring money through your bank
Using your bank is one of the easiest and safest ways to send money overseas, but it can be costly. Every Australian bank charges a different fee for their services, usually between $10 to $32 for each transfer.
Using money transfer companies
When it comes to sending amounts of up to $1000 to family and friends, the cheapest options are online money transfer companies, like Transferwise. Their fees vary between $0 and $15 for small amounts.
Make sure to plan ahead as setting up an account and getting approval can take a few days.
Some money transfer companies let you use cash or EFPTOS, but the fees when you do it that way are generally higher than doing it online.
International Money Order
You could also get an international guaranteed check at your bank and send it by mail so your family can deposit it in their bank account. It’s obviously much slower than the previous options.
Check the exchange rate
If your transfer is not urgent, you might want to wait and shop around for a good exchange rate.
“There are lots of options but you should shop around for a good exchange rate. This could mean the difference between more money or less money in the bank account of the person you are sending the money to,” says Warren Day, Regional Commissioner for Victoria for the Australian Securities and Investments Commission.
Do your research
If you pick a money transfer company, it’s important to pick a reputable one. You can use websites like SendMoneyPacific, SendMoneyAsia and Remittance Prices Worldwide to check if the company you’ll be using can be trusted.
Keep all the information until the transfer is received
Once you’ve done the transaction with a money transfer company or your bank, make sure to keep all the important information somewhere safe; transaction number, amount of the transfer, time of the transfer, etc.
If there’s an issue and the money is not received, you can go directly to the company or the bank with that information and they should be able to help you.
If they can’t find the money and/or if you’re not satisfied with their response, you can complain to the Financial Ombudsman Service.