Whether you want to pay back a friend for dinner, send a gift to a relative overseas or transfer funds between your own bank accounts, there are several methods that can help you get the job done. The best method depends on whether you’re sending a small or large amount, how quickly you need the money and where it’s going.
While some traditional ways to transfer money, like physical cash and checks, may seem outdated, these old-school options are still widely used in the world of finance. Some people, however, prefer to use newer electronic methods that offer speed and cost-savings.
One such method is to use a digital payment app or website to move money between two parties. These apps work with a recipient’s email or mobile phone number to verify their identity and then transfer funds to their account. Some examples of these services include Venmo, PayPal and Zelle. They are often faster than making a wire transfer and provide a notification to the recipient when their transaction is complete.
Another option is to use a bank’s online or telephone banking service. This method is usually fast and free, though it can depend on the size of the transaction and the destination country. To make a bank-to-bank transfer, you’ll need the recipient’s full name, bank account number and the international code for their currency (for example, USD for U.S. dollars, GBP for British pounds and ZAR for South African rand). Then you’ll need the routing number, which is also known as an ABA or bank routing number, which is unique to each financial institution.
In addition to the cost of the transfer, you’ll also face exchange fees when sending money abroad. You can minimize these costs by comparing total transfer fees across multiple providers, including both the upfront fee and the markup on the foreign exchange rate. In general, online nonbank providers offer lower upfront fees and better exchange rates than banks.
Some services specialize in transferring money to countries where the banking system is less advanced. These companies, which typically have a network of agents around the globe, can deliver your funds to recipients via cash pickup, mobile transfers or direct deposit into their bank accounts. They can charge higher upfront fees than a domestic wire but are still a good option for larger transfers to many destinations abroad.
A final option is to use a cryptocurrency, such as Bitcoin, to transfer money overseas. This can be tricky, as different countries treat cryptocurrency differently and some don’t even recognize it as a form of money. You’ll need to have some crypto in a digital wallet and a recipient with a compatible cryptocurrency app or wallet, and you should check how each country treats cryptocurrency transfers before using this method. In general, however, sending Bitcoin is relatively inexpensive and fast, as long as you and your recipient are in a country where it’s legal to do so.