What is the best way to transfer money abroad?

What is the best way to transfer money abroad?

By Matt Fernell, Editor-in-Chief at Finance.co.uk. Published 2nd November 2023.

Matt Fernell

Sending money internationally doesn't have to be complicated or expensive. Here are all the ways you can send money abroad and find the right option for you.

What are the different ways to transfer money abroad?

There are several ways to send money internationally, and each method has pros and cons.  Here are the main ways to make an international money transfer:

High-street bank transfer

Using your current bank account might be the most straightforward way to send money abroad, but it’s probably not the cheapest.

Most high-street banks can transfer money from your account to an account in another country, but they will usually charge a transfer fee.

This is either a flat fee or a percentage of the amount sent, so it can be expensive if you’re sending a significant amount. Their exchange rates also may not be the most competitive.

An international transfer via your bank can be fee-free if the recipient holds an account with the same bank or provider.

Online international money transfer providers and brokers

International money transfer services can offer the fastest and most cost-effective way to send money overseas.

Most providers don’t charge a transfer fee, and they usually offer competitive exchange rates. You’ll need to open an account with them first, and the transfer recipient might also need to have an account too.

Foreign exchange brokers tend to offer the very best exchange rates but can charge commissions as part of their service.

PayPal

If you only need to send relatively small amounts of money abroad, you can transfer using your PayPal account. Money can be sent straight to the recipient's bank account or as a cash pickup. 

There is usually a fee, which will vary depending on the amount you’re sending, whether it’s a direct bank transfer or a cash pickup and the country you’re sending to. Generally, the minimum fee is £0.99, and the maximum is £3.99. 

International money orders

An international money order is a printed document that you can send by mail to the person you want to transfer money to. They can then cash the document at their bank or post office.

They’re considered a safe and secure way to send money abroad and also don’t require the recipient to have a bank account. However, they can come with fees for both the sender and the receiver and can only be used for relatively small amounts. 

They’re also a lot slower than a bank transfer and don’t usually come with the most competitive exchange rates. 

Which option is right for you depends on a range of factors, including how much you want to send, how regularly you want to make payments, and who you currently bank with.

What is the safest way to transfer money internationally?

Apart from sending cash through the post, most methods of sending money abroad are safe and secure. 

Banks and international money transfer providers are all regulated by the Financial Conduct Authority (FCA) and have advanced security checks and protocols in place to help prevent fraud, money laundering or identity theft.

The most significant risk to any money transfer method is falling victim to fraud or a scam. Always check the credentials of any company or service you use to send money abroad to make sure they’re legit. 

Here are some top tips for staying safe when sending money abroad:

  • Double-check the recipient’s details carefully before sending any money

  • Use two-factor authentication when using an online service or app

  • Watch out for scams, especially unsolicited emails or offers that seem too good to be true

  • Research the service you use carefully to make sure they’re legit

  • Keep records and receipts of your transactions in case something goes wrong

What is the cheapest way to transfer money overseas?

When sending money abroad, how much it costs will probably be one of the biggest factors when deciding which method to use.

It’s tricky to know precisely what the cheapest method of international money transfer will be because it depends on several factors:

  • The amount you’re transferring

  • The country you’re sending it to

  • How quickly you need to send it

  • Whether it’s a regular or one-off transfer

Generally, currency brokers offer the best deals if you’re planning to send a large amount of foreign currency. In contrast, a bank may be better for setting up a regular payment overseas.

If you’re sending an amount under £5,000 as a one-off or infrequently - use a method that doesn’t come with any transaction fees.

It makes sense to do your research to see what deal each international money transfer provider can offer you. If you’re sending large amounts of money, the exchange rate will be the main cost, so look for the option with the best rate.

For example, if you want to send £50,000 from the UK to India and the exchange rate is 1:100, the recipient will get 5m Rupees. If the rate is 1:101, they’ll get an extra 50,000 Rupees, worth around £500 - so it’s worth getting the best possible rate, even if it’s only a small increase.

The best way to send money abroad

The best way to transfer money overseas isn’t necessarily the cheapest option. Sending money abroad should also be hassle-free, safe and secure.

Here are our top tips for getting the best international transfer deal:

  • Use a comparison website like ours to easily compare fees, transfer speeds, exchange rates and perks.

  • Benchmark the best exchange rates so you know what to expect and what to aim for.

  • Get quotes from online brokers and providers and factor in any transfer fees.

  • Talk to your bank first if you’re transferring a large amount or want to set up regular payments.

  • Find out how long the transfer will take - banks are usually the slowest and online providers are the quickest.

  • Check the provider is regulated by the FCA, provides a telephone number and is well-reviewed.

The best way to send money internationally should suit your financial circumstances, be cost-effective and provide peace of mind.

The information provided does not constitute financial advice, it’s always important to do your own research to ensure a financial product is right for your circumstances. If you’re unsure you should contact an independent financial advisor.