Monthly Archives: December 2016

money-transfers-actors

Who are the actors in money transfers?

Both individuals or businesses need to do international money transfers. The first time you need to move money across countries it can be difficult to know how to do it to optimize the transfer. However the options are not missing. Many actors operate in money transfers. Here is a quick overview.

money-transfers-actors

The Banks: the biggest actors in money transfers

The solution the most known: 95% of the people use their bank to do a transfer. The pros is that it is simple safe and secure as a bank already know all your personal information. That said it depends because with more and more regulations it is not so easy to make an international transfer sometimes with a bank. It doesn’t allow you to transfer in every country. But the real con with banks is that they take huge fees on your transfer and you don’t even know it because the fees are hidden in the exchange rate used. An international transfer can be advantageous with banks if the recipient has an account abroad with a branch of your local bank.

The foreign exchange brokers (FX brokers)

Another actor in money transfers: the brokers. The latter are specialised in exchange of currencies. They can provide better exchange rates than banks but they are only to use for large sums to transfer because there is a minimum transfer amount to operate and their rates are not so advantageous for small transactions. They are advantageous for big amounts to transfer. A few steps are required to create an account with them and book a transfer. Ideal for someone doing regular transactions or for businesses sending a lot of money abroad. You’re directly in contact with a broker.

The traditional money transfer operators  (MTO)

You probably know the traditional money transfer operators which are Western Union, MoneyGram and Ria money transfer. They are so huge that they almost own all the market in cash-to-cash transfer to them three.

The online MTO, peer-to-peer companies

At last there are the peer-to-peer MTO. They are the most recent as they all appear in the last ten years. They are really innovative, online, cheap and easy to use. They allow to drastically reduce fees in money transfers. The average cost of sending money abroad with an online MTO is in average 2% to 3%. They are really interesting actors because they are new, innovative, and all can be made online. They provide a wide range of payment and delivery methods. With your bank or with a broker you can only do bank-to-bank transfer. With online MTO you can pay by credit card, debit card and you can receive the money by cash pickup, bank deposit, mobile wallet, mobile recharge and even by email. The only con they have right now is that sometimes there is a maximum amount to operate but this is gonna evolve with the growing market. More and more people hear about these MTO. A good example is Transferwise.

The blockchain network

At last there are the blockchain networks based on a new revolutionary technology. They will be in the future the cheapest options but at the moment the market liquidity is limited, and it’s usability not really optimized for a large public. If you need more informations about the blockchain, feel free to check their site: https://blockchain.info/

Here you go you know all the options to do money transfers. If you want to know more check here a at a comparison service

worst-money-transfer-advice

The worst advice you’ve ever heard about money transfer

I recently became an expatriate as I moved from France (my home country) to Canada for my job. Quickly I got aware of the notion of money transfer as I needed to pay back my student loan in France. I was a totally beginner as I never had to send money internationally.

How I got informed about money transfer

Like many people now, I went online and asked for help on forums or expats groups on Facebook. I got responses quite easily but the issue was that none of them was the same. My question was simple: what money transfer operator do you use.

One would advise me to use WorldRemit, another one told me about Western Union, Ria etc, etc. Some even pushed one solution with a dedicated link asking me to use it to make sure they’ll get paid!

Many answers also seemed based on personal beliefs and no one was able to justify with figures or solid arguments their position. Some examples I read:

“Western Union is the best, I’ve been using it for more than 10 years” – ok but it’s not because you’re using a service for a long time that it is the best right?

“Moneygram is great, I use it to send money back to my uncle in India who does not have a bank account” – I’m not sure I am not sure we have the same needs.

The good thing about that process is that I got familiar with the main actors of the money transfer industry. However I could not tell which one was good for me. So I had to do some research by myself.

How I found reliable information about money transfer

I cannot remember how but at some point during my researches I found Moneytis: a comparison platform for money transfer operators. I found many reliable information about different actors in the industry in very detailed reviews. But the best part of this website is that with 3 clicks you can access a comparison of all the services operating between 2 countries for a given amount.

For example, if I select Canada to France for CAD 1000, here is what I get:

worst-money-transfer-advice

As you see for each service I know how much it will cost me, how long it will take for the transfer to be made and how easy is the platform to use.

In the end I strongly recommend to use Moneytis as you’ll get a clear and simple way to find the best operator for your money transfer. It’s important to get people’s feedback but most of the time I will not necessarily fit your own needs.