Sending thousands of dollars abroad is a common practice for many individuals and businesses across the globe. Some send money overseas to fund family and friends while others invest in foreign real estate or businesses. Before sending thousands of dollars internationally it’s important to understand the rules and restrictions for sending and receiving money, especially if the amount is $10,000 or greater.
Depending on your financial institution there can be many fees and regulatory bodies to comply with and even then, the time frame in which your exchange is completed can be lengthy. Traditionally banks have been the most reliable source for international transfers but the cost to complete these large transactions is much higher through established banks.
“In cases such as these, it is important to look at the exchange rates because although a fee might not be charged, the institution could be making money off of the transaction fee spread” according to Investopedia.
Wire transfers are also used to send large amounts of money overseas and are usually completed after the delivering bank fills out the forms needed to legitimize each transfer. There are fees tied to these transactions as well but is seen as necessary and worth the cost due to the protection it offers to both of the banks involved.
There are also Automated Clearing House (ACH) transactions that are fee-free but do require both participating banks to be linked together. ACH transactions are electronic, using a digital clearing house that acts as a middle man to process the exchange of money. “The Federal Reserve bank, for example, is the largest US ACH operator, processing 63% of all commercial ACH transactions in 2019.” In order to complete these forms of exchanges, there are bank-specific instructions that must be followed.
Cash can be an acceptable method to send large amounts of money abroad at transfer centers such as Western Union, where you can deposit physical cash and convert the domestic currency to a foreign one. After this is completed the receiving party can visit the money transfer center and in some cases the money can actually be delivered to the recipient at a residential or commercial location.
After paying an activation fee, prepaid debit cards are another source for international money transfers to be completed in both small and large quantities of money. The sender can load the card with cash and the recipient is able to use those funds immediately—there can be monthly fees also tied to these types of cards.
When sending large sums of money overseas it is essential to make sure your money is secure and that you’re not paying more than you have to in order to process the transaction. If you’re planning on bringing more than $10,000 into Canada it must be declared in order to do so. Electronic transfers over $10,000 will be reported to FINTRAC and the CRA (Canada Revenue Agency). Once you comply and declare the money being transferred, you can send money internationally without working on tax complications.
Selecting the best service to transfer money can be a difficult decision but with Remitbee you can send money overseas knowing that you are using a safe provider that offers you fast service with the lowest fees possible. Visit www.remitbee.com for all your currency conversion and online money transfer needs.
By Surina Nath