How to save on Extra charges when sending money to India?


When it comes to transferring funds from overseas to India, there are several intermediary institutions involved in the process, including remitter bank, remitter’s correspondent bank, receiver’s correspondent bank, receiver’s bank account. As such, one needs to be cautious and diligent while making such transfers. However, in addition to the procedural caution, one would need to exercise, one should also exercise financial caution to save on extra charges when sending money to India. 

There are several avenues wherein the costs may increase during the fund remittance process and how one can save on such expenses with Money2India (M2I):

  1. Changes in Currency Rates – When one wants to send money to India, the remitting bank will charge the amount in foreign currency, which in the case of the USA would be USD (US Dollar). However, the receiver would receive the money in Indian currency in an Indian bank account. As such, the prevailing currency exchange rate is applied for the transaction. Owing to the volatility in the currency markets, the exchange rates change every moment. Some of the remitting institutions show the currency exchange rate at the time of confirmation; some agencies apply the currency rate applicable at the time of actual processing the transaction. As such, the remitter may not know the exact amount the Indian bank account will receive in the latter case until the transaction is actually processed. M2I provides the currency exchange rates in a transparent manner on the portal and confirms the same at the time of transaction confirmation as well. So, the remitter knows exactly how much money would be received by the Indian bank account when the transaction is submitted for processing. 
  2. Currency Conversion Charges and Markup Charges – Some institutions also charge additional forex conversion charges and markup charges on the outward remittances. Such conversion charges and markup charges can range from 2% to 5% of the prevailing exchange rates. This adds to the transaction costs for the remitter. M2I does not charge any markup charges, and further, the exchange rate being used for the transaction is outrightly disclosed to the remitter. As such, the remitter can make an informed decision without being at the mercy of the transaction portal for any hidden transaction charges. 
  3. Transaction Processing Charges – Owing to the involvement of different intermediaries in the process, different institutions generally charge transaction processing charges to recover the associated costs with the transaction. M2I charges no transaction charges for money transfers from the USA to India for an amount exceeding USD 1,000, while for fund transfers with lower amounts, service charges of USD 4 are levied. For funds transfer from Singapore, there are no transaction processing charges involved irrespective of the transaction amount, while for funds transfer from the UAE (United Arab Emirates), a flat charge of AED 12 is charged. 

With currency markets being dynamic, you should plan inward remittances to India in a timely manner and select the best option for making an international money transfer at the most competitive rates and transaction costs. 

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