It is challenging for an international student to understand how to make an international money transfer or convert money across currencies. Traditional banks may appear to be the safest and easiest way to transfer money between nations; nevertheless, hidden fees and difficult processes may hide beneath the veil of terms and conditions. Fortunately, more options for sending and receiving money while studying abroad exist, such as international wire transfers, also known as international money transfers. In the guide below, we will talk about everything you need to know about international wire transfers, including what they are, their costs, the best services and much more. So let’s not waste any more time and get right into it.
What is an international wire transfer?
International wire transfers or international money transfers are also known as SWIFT transfers. It is a process of sharing funds from one person to another electronically. Wire transfers allow you to move money quickly and securely, making it ideal for sending large amounts of funds. For you as an international student, this can mean paying for your rent or your tuition fees. Because of the SWIFT number, international wire transfers are often known as SWIFT transfers. This unique bank-identifying code transfers funds from your home country's bank account to an international bank. These methods are more secure and faster and allow for real-time updates.
What is a SWIFT transfer, and how does it work?
SWIFT stands for Society for Worldwide Interbank Financial Telecommunications network. The SWIFT network is a member-owned system for financial messaging and transactions used by banks and financial institutions worldwide. International wire transfers are synonymous with SWIFT transfers. A SWIFT transfer is a message containing payment instructions sent from a payer or a receiving bank to a receiving bank. At the time of setup, a SWIFT transfer is a payment order (message) sent from the sending bank to the receiving bank.
SWIFT requests are often issued on behalf of a personal bank that wishes to transfer funds internationally, either in their local currency or in the currency of the country receiving the funds. SWIFT transfers typically take 1 to 5 business days. However, delays are typical and can occur due to national holidays in either country of a transfer, inaccurate SWIFT/BIC codes or many other cases like bank outages or the involvement of intermediary banks.
How to use an international wire transfer?
When people think of an international wire transfer, they think of a lot of paperwork, verification, identification, and much more! You can easily stay on top by organising and preparing all the necessary documents. One thing to remember is that the exact process varies from one bank to another and the company/service you use. The best way to send money internationally is by verifying all the information you need like:
- Account holder's name, full mailing address and institution number
- Account number
- SWIFT code
- Routing number
- Branch number
You must evaluate all fees and additional expenses. When performing an international wire transfer. Fees are charged whether you send or receive funds and can add up quickly if not correctly calculated.
How much does an international wire transfer cost?
The currency utilised, the destination, and the sender all influence the cost of an international wire transfer. Each bank and service provider will have their cost structure and charge varying fees in addition to the daily exchange rate. There are three significant fees to keep in mind that are:
- Fee for sending money: Traditional banks typically impose a fee of £30 or more to complete the transaction of sending money abroad.
- Exchange rates: Traditional banks sometimes levy a hidden cost of up to 5% above the daily exchange rate, which can quickly mount up if you're an international student transferring money on a regular or significant scale.
- The fee to receive the payment: Some banks may charge your receiver a fee to receive money from abroad, depending on the bank.
These factors can help you save money on fees while transferring money. If you want to know more on this topic, our blog about ways to save money on money transfers will assist you greatly.
Pros and Cons of an international wire transfer
There are many pros and cons of an international wire transfer, and in the table below, we have listed a few of them
Factors to consider when deciding how to transfer your funds
There are a few factors to keep in mind when deciding how to transfer your funds, like the amount you will be transferring and how frequently, what is the protection your money will have and do they accept the currency you use. Here is a small description of these factors.
The amount you'll be transferring and how frequently you'll be transferring
If you're going to be transferring money regularly, search for the transfer provider that will give you the best bargain over numerous transactions before using any international money transfer services. If you're looking for a one-time or large transaction, you should seek any current specials that best suit your needs.
Do they accept the currency you use?
While most transfer providers support major currencies, double-check that your platform accepts the currencies you'll send money in. Similarly, if you're sending or receiving money from another country, ensure the site supports the destination.
What protection will your money have?
Check the authenticity of any service you use before handing over any funds, and only do so if you are comfortable with how your funds will be secured. The Financial Conduct Authority in the United Kingdom, the Consumer Financial Protection Bureau in the United States, the Financial Consumer Agency of Canada, and the Australian Prudential Regulation Authority all regulate financial services.
Which international wire transfer methods are best for students?
There are numerous international wire transfer services available. The list goes on and on, which can be confusing for anyone. The table below can help you find a transfer service that will suit you. This is by no means an exhaustive list, so conduct more research based on your individual needs.
So there you have it: all you need to know about international wire transfers. Making an international bank transfer is now easier than ever, but it is always a good idea to be informed before deciding on the best approach to send money internationally. Did you know there are many ways to save money on foreign exchange? Our blog on ways to save money on foreign exchange will help you out!
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