The following question will sound familiar to many people who live and work outside of their home countries:
“How do I send money back home to my loved ones?”
For example, you might be working in the United States and have family or loved ones in another country. You want to support or help them financially by using the money that you earn. So how do you do that? The short answer is that you send a remittance, which is a sum of money sent from one person to another, typically overseas. The provider facilitating the transaction charges a fee for sending your money through their network and your chosen recipients then receive the money in whatever format you specified (more about that in the next sections).
Is remitting money safe?
Sending money to another country can be stressful, but as long you choose your provider carefully and have the correct payment details for your recipients, these payments are safe and secure. So much so, that according to the Pew Research Center, over $625 billion was remitted worldwide in 2017, with $148 billion of that remitted from the United States alone.
How can I remit money?
Unsurprisingly, given how much money is being remitted worldwide, there are many remittance choices. The most common ways to remit are:
- Bank transfer or wire transfer – You send money between two banks.
- Mobile money – Funds are sent to an electronic wallet.
- Cash pickup – You send money to a specific location, typically a branch of the provider you chose, and your recipient collects it after showing a confirmation number and their ID.
- Home delivery – Cash is delivered to a specific address, and the recipient shows their ID to receive it. This is particularly useful in congested cities where traveling might be time-consuming or in remote locations.
Is remitting money expensive?
Make sure that you check the provider’s transfer fees, the currency exchange rates at time of transfer, and also the time it takes for the transaction to process (also called the remittance float). If you are careful, remitting money can be cost-effective, but additional services, transfer fees, and the exchange rate will all be a factor in your experience.
Also, remitting money to a country that has more remittances than others might be cheaper due to the transaction volumes. If in doubt, check with your provider and make sure that they have transparent pricing.
Do I have to do this in person?
Many providers are now online or available through an app on your phone. Remitly, for example, has an app that you use to send money to your home country. However, if you’d prefer to do your remittance in person, your best bet is to check with a bank near you.
For more information about managing your money, check out this Boundless article on the best finance apps for immigrants.