You may have found yourself in a situation where you wanted to send someone some money instantly but did not know how to reach them very fast and efficiently. This happens every now and then when you have a relative or a friend in a different location without the same banks as your home town. But thanks to the growth in financial innovations that allows you to transfer money without fees you can now send money online instantly!
There are a myriad of different companies coming up in the money transfer sector which are providing fast and cheap ways to move money from one part of the world to the other instantly. Beside fintech innovations, we also have our traditional money transfer systems that have been with us for quite a while. To understand how each of the money transfer systems work, we are going to analyze 5 top means of money transfer around the world.
Bitgold is a comprehensive online money transfer system that uses gold as its base currency. To start using Bitgold online money transfer system, you need to open an account with them which is free. You will then be issued with a prepaid card that you can load with gold and use it in making payments at the points of sale. To make money transfer to anywhere in the world, you first need to purchase gold using your debit or credit card or through wire transfer. You will be charged only 1% of the gold spot price when purchasing and that will be the final fees you pay. When transferring the money to another person, you will only need their email address, phone numbers and the amount you wish to transfer. Once you fill in that data you then click send and the recipient gets the money immediately in their Bitgold account. The recipient can then choose to redeem their payment into their local bank account or into their Gold money Master Card Prepaid card.
With PayPal you can send money all over the world to anyone with a PayPal account. The transfer is usually free but the recipient is charged a fee for withdrawal. For amounts up to $3000 the fee is 2.9% of the amount being sent, and the rate goes a little bit lower when you transfer higher amounts. There is also a fixed fee of $0.3 per transaction. For international money transfers, the fees will be higher and on top of that you will be charged for the forex exchange. When sending money, all you need is to fill in the email address which the recipient uses for PayPal and put in the amount you want to send and then click send for instant remittance of the money to the recipient.
If you are not very conversant with the online money transfer systems, you are most likely to end up using your bank to make transfers to other parts of the world. This usually takes the form of wire transfers facilitated by the bank teller. You will however have to give the bank teller the account number and the bank routing number for the recipient and their bank. For international money transfers you will be required to provide the recipient’s name, address, bank details where the money is being sent, SWIFT or IBAN of their receiving banks. Bank transfers are always relatively expensive compared to other means of money transfer.
Closely related to bank transfers is e-transfer. This is where your financial institution allows you to do the money transfer by yourself online instead of going to the bank. The information details needed when initiating the transfer for both local and international transactions are similar to those you present to a bank teller when you want them to initiate the transfer for you. The advantage of the e-transfer is that you can transact at any given time from anywhere in the world. The fees charged also tend to be lower than when you physically visit the bank for the bank teller to do the transfer for you.
Western Union & MoneyGram
These two are almost similar and they mostly compete on costs and convenience depending on how far one lives from their agencies across the world. They both charge a flat rate based on the amount you are sending, where you are sending it to and fast you want the money to get to the recipient. For international transfers foreign exchange is also charged when the money is transferred. Their main advantage is their reliability and the fact that they are trusted brands having been in the industry for quite a long time than the recent fintech entrants.
There you go with your 5 top money transfer options. Different people prefer different methods of money transfer, but if you are involved with international money transfer, then online money transfer will be your first choice; especially when there are no costs involved in the transfer of the cash.