It is a common belief that in today’s world, money is practically everything, and with it, you can provide yourself and your family the best houses, the best cars, the best education, the best healthcare, and the best standards in life. Likewise, for everything to do in the world, you need to spend some money and in fact, nothing is free. Accordingly, for a thing so important in our lives, its transfer is also crucial. Good to know that every year, tens of billions of dollars are transferred around the world by citizens and businesses for purposes such as overseas investment, paying international workers, buying or selling overseas property, supporting family and friends, etc. and if this money transfer is stopped only for one day for any reason, the global consequences are beyond imagining. Today’s digital banking is so well-developed that you can transfer money from wherever you are to wherever you want, all in a matter of minutes. There are even many online applications you can install on your mobile phone, by the use of which you can make international money transfers in multiple currencies 24/7 without having to leave your home.
Which Country Transfers How Much Money?
Among countries, the U.S. transferred the largest amount of money internationally, close to $70 billion overseas in 2019. Data from the World Bank indicates that the biggest recipients of America’s money were Mexico ($34.7 billion), China ($14.3 billion), and India ($12.7 billion). Saudi Arabia was the second-largest sender of money in 2019. The $31.2 billion that was transferred from the Kingdom overseas was primarily distributed between India, Egypt, and Pakistan, among others. Compared to other countries, it is rather cheap to send money out of Saudi Arabia with an average transaction cost of 5.5%, while it can be higher than 27% for countries such as Angola. Closely behind, Switzerland was the third-largest sender of money in 2019, topping just over $27 billion. The top three were followed by Germany ($24.1 billion), Russia ($22.2 billion), China ($15.1 billion), France ($14.8 billion), the Netherlands ($14.5 billion), Luxembourg ($13.7 billion), and Qatar (just under $12 billion) [1].
It is also worth knowing that this tremendous amount of money couldn’t have been transferred worldwide if it wasn’t for the Internet and the online platforms of money transfer. The internet revolutionized the traditional ways of money transfer and today, with the help of online platforms, people and businesses around the world can very much easily transfer billions of dollars anywhere, anytime. To get more information, read Essential things you need to know about money transfer and money exchange.
Pros and Cons of Top Six Online Platforms of Money Transfer
To save time and money, and to avoid safety concerns, old methods of money transfer such as using cash, checks, bank drafts, or money order are all getting less and less popular when there are easier, faster, more economical and still safe electronic methods for transferring money between accounts, states, and even countries. Here in the present article, the commonest online platforms of money transfer are explained in rather good details and for each platform, the advantages and disadvantages are also discussed so that you the readers can have a chance to quickly compare these platforms and make the right choice.
Remitly
Remitly is an American online money transfer platform allowing people in the U.S., Canada, the Eurozone, Australia, and the U.K. to send money to about 49 countries worldwide. As a digital alternative to traditional money transfer services, Remitly makes money transfers fast, secure, and relatively inexpensive. This platform has a 100% satisfaction guarantee, which means that if your money doesn’t arrive on time, they will refund their fees. Remitly, however, does not make money transfers to the United States, Canada, or Western Europe. Exchange rates aren’t the best, especially for fast transfers. When you pick Remitly’s Express service, they give you a worse exchange rate or charge a higher fee for the transfer (a $3.99 fee for express transfer). For usual transfers, Remitly is quite slow and an international transfer will take 3-5 working days. Besides, Remitly charges a 1-3% fee on the amount sent when you use a credit card, instead of a debit card or a bank account. The amount depends on the country. Remitly is also online only. That is, there’s no way to meet someone in person for help. There are also daily and monthly limits on how much you can send. Their default limits start at $2,999 every 24 hours and $6,000 every 30 days [2]. You qualify for higher limits by contacting customer service and providing information to verify your identity, including a form of government ID. Remitly doesn’t have recurring transfers, limit orders, and any other hedging tools to help you save money by planning your money transfer in advance.
Western Union
This American company of international money transfer services offers person-to-person money transfers in more than 500,000 agent locations in over 200 countries and territories. Western Union gives access to users through its website and it also has a mobile application that allows you to send money easily. Western Union’s send money online service is available 24/7, with which you can send up to 15,000 USD per transfer. This platform, however, is not tax-free. They charge a flat rate for the transfer that is based on the speed of the transfer, the location you’re sending money to, and the amount of money being sent. Based on the amount of money, for instance, Western Union charges $5 for a money transfer of up to $50, and a transfer of $900 could cost a fee of $76. As an example of fees, a $200 transfer through Western Union to a location within the United States or Canada will cost you around $12 for a rapid transfer and $8 for a usual transfer. A transfer to the United Kingdom will cost around $22 if done through an agent of Western Union, and $15 if done online. Fees can change at any time. Slow delivery is therefore a weak point for Western Union (usually four to five days). There are also specific money transfer limits using Western Union which vary based on several factors, including your transfer history, your location, your receiver’s location, the service you choose, your payment method, agent location limits, and country receive limits.
TransferWise
TransferWise is an online platform that offers payment services internationally. TransferWise is easy to use online and you can also use the mobile app on your smartphone to transfer money. TransferWise supports more than 750 currency routes worldwide, among the most popular of which are GBP, USD, EUR, AUD, and CAD. This online platform offers customers actual and fairly up-to-date exchange rates. Using this online platform, the money transfer is not for free, however, and you need to pay tax, an extra charge for the transfer. The TransferWise fee is worked out as a percentage of the amount you’re sending, which means that the more money you send, the more your transfer costs. If you want to convert a currency using your card, for example, a fee of 0.35%-3% will await you, and for an ATM withdrawal of more than $250 per month, you need to pay 2% of the actual amount of money you want to get. In addition, it will take 1-4 working days for your money after you transfer it to go directly to the target person’s bank account. You also need to take into account using such a money transfer service that there are limits for how much you can send with TransferWise. They depend on which currencies you send to and from, and how you pay. For example, for US dollars (USD), only 2,000 USD per 24 hours and 8,000 USD per 7 days can be transferred using debit or credit cards. TransferWise doesn’t have a banking license, which means no deposit guarantee, direct debits, or standing orders.
OFX
OFX is another online money transfer platform that offers its services also through a mobile app or over the phone. Everything in OFX is done online from signing up, to having your identity verified, getting the OFX app, and transferring money. OFX services are available 24 hours, 7 days a week, even when the Foreign Exchange markets are closed. OFX has transacted over $84 billion over more than a decade so users can feel confident in their ability to move their money safely. Because OFX bases the rate they charge on how often you use the money transfer services, it is an economical option for those who make frequent transfers. Using OFX, you don’t have to be worried about transferring huge amounts of money as there are no maximum transfer limits, on the other hand, there is a minimum transfer limit in OFX, which means you can’t use this platform if you want to spend less than $150. OFX transfer fees can vary according to what currency you are transferring between 0.5% and 0.8% of the transfer amount. There is also an additional fee of $15 when you want to send under CA $10,000 or AUD $10,000 by this platform. This means that When you transfer a smaller amount of money, it gets relatively expensive. OFX money transfer system is also quite slow; For most major currencies, transfers may take 1-2 days (from the time OFX receives your funds). With most exotic currencies, however, this process may take anywhere from 3-5 days. End-to-end transfers take usually about 5 company days.
PayPal
PayPal is an online payment platform that provides its users, individuals, and businesses around the world the features to receive or send money online. PayPal is operating in 202 markets and has 305 million active, registered accounts. This platform provides its customers with services such as the possibility of holding, receiving, or sending money in 25 different currencies worldwide. It is very much mobile-friendly and has a mobile application that is super easy to use. You can shop, withdraw and send money, anywhere at any time. It’s free to send money on PayPal. However, the recipient has to pay tax and is charged a fee to cash the payment. For transfers up to $3,000, the charge is 2.9%, plus $0.30 per transaction. International transaction fees tend to be about 1% higher and keep in mind that you’ll be charged an exchange rate on transfers made internationally. PayPal’s algorithm can sometimes detect suspicious behaviors in your account and then automatically freeze your account, without warning. Besides, some banks may charge you with transaction fees when you transfer money from your PayPal account to your bank account. The platform also requires 2-4 days of your time to do your money transaction depending on the amount of the money and the distance where you want to send or receive that amount. Although PayPal claims they help small transactions, the hidden fees show no signs of it, the fees might be from 1.9 to 2.9 percent plus $0.30 per transaction which can get very costly.
Trustply
How Does Trustply Platform Stand Out in Money Transfer?
Trustply is a real peer-to-peer (P2P) payment service that offers a new, easy, fast, safe, and totally free way of transferring your money. Using the Trustply platform, you can transfer money at any time and any place you want. Good to know that a peer-to-peer money transfer uses a website or app to transfer funds from one person to another over the internet or mobile networks. For international payments, peer-to-peer will match buyers and sellers of different currencies to deliver a competitive exchange rate [3]. Trustply, as a peer-to-peer or person-to-person currency transfer platform, supports fast transfers and provides substantial savings over banks and even the above-mentioned platforms. The five above-mentioned platforms are ranked as peer-to-peer services, and so is Trustply. However, Trustply is different in that it covers all the currencies in all countries around the world. In addition, Trustply charges you literally nothing for providing you with money transfer services. This means that Trustply users can and transfer whatever currency they want 100% for free. Unlike any other so-called peer-to-peer platforms, it is only in Trustply that you can see the real peer-to-peer model of currency exchange without the intervention of any intermediary at all. And that’s because we in Trustply focus all on the value of being totally social.
Although P2P platforms somehow omit the middlemen in the exchange and will result in lower, yet not totally free transaction fees for the customers, the two sides still are required to first send their money to the account of the P2P platform and the money will stay in the platform’s account for quite a time. What makes Trustply stand out and be different in this regard is that this P2P platform has a completely social network nature, where the two parties of a money transaction can directly make contact with each other and trade their currencies themselves with the price they prefer, the person they pick and the method (e.g., online or cash) they choose. This means a real peer-to-peer trade where the company will not act as the middleman and therefore will not charge the parties of the trade for the service. To get more information about money transfer and other unique features of this tax-free P2P platform, go to Trustply.com.
Sources: worldbank.org | depositaccounts.com | clover.com
