Doing an international transfer means that you are directly sending money to the bank account of someone living abroad. You can transfer money overseas through a bank or a digital payment platform. The person you are transferring the money to is known as the beneficiary. Moreover, the bank to which the funds are transferred is called the beneficiary bank.
The Reserve Bank of India (RBI) regulates the transfer of money from India through a process called outward remittance. The maximum limit for any purpose like travel, study, employment, etc is $250,000 (INR 205.65 Lakh) per financial year. If you want to know how international money transfer work, keep reading our blog!
Reasons for using International Money Transfer
There are many different reasons for people want to transfer money overseas from India. Written below are a few of them:
- To study abroad
- Medical treatment abroad
- Travel or vacation
- Buying property abroad
- Overseas investments
- Paying overseas bills
- Supporting a family member living abroad
- Employment abroad
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How Does International Money Transfer Work
Have you ever wondered how does international money transfer work? International money transfers are initiated at one place or country and are sent to another. Even if the person abroad has an account in the same bank as you, you will still have to initiate an international transfer. These international payments need a routing or SWIFT code. Read further to understand what are the steps of transferring money internationally.
Steps for International Money Transfer
In order to transfer money online internationally, you will have to follow these steps.
Step 1. Log in to your online bank account and look out for the wire transfer section that your bank has offered on its online banking service
Step 2. You will then have to provide the recipient’s bank details like name and address. Moreover, you will also need to give the recipients name, address, and the type of account they have with their bank ie. current, savings, etc. You will have to give the account number and the recipient bank’s BIC/SWIFT code.
Step 3. The next step would be to enter the amount as well as the currency that you want to send.
Step 4. The last step will be to pay the transfer processing fee
In case you want to transfer the money physically, through a bank, you will have to follow these steps:
Step 1. After visiting the bank you will then have to provide several details to the bank staff. These will include the recipient’s bank details like name and address. Moreover, you will also need to give the recipients name, address, and the type of account they have with their bank ie. current, savings, etc. You will have to give the account number and the recipient bank’s BIC/SWIFT code.
Step 2. You will then have to decide and tell the staff the amount as well as the currency that you want to send.
Step 3. The last step will be to pay the international transfer fee
Bank Muscat International Transfer
Documents Needed for International Money Transfer
Following are some of the documents that will be required to transfer money internationally from India.
- Form A2
- Copy of PAN Card
- Original fee receipt
- Proof of adequate funds
Things to Keep in Mind Before International Money Transfer
Now that you know how international money transfer work, there are a few things that you must keep in mind before transferring money internationally. Some of them are as follows:
How much time is it taking: You will have to see how much time it is taking to transfer money online/offline from India to overseas. For online transfers, it may take up to 48-72 business hours. For demand drafts, it may take up to a few days too. You must keep in mind these times so that you are not late in transferring the money. Moreover, the faster the transfer, the more the transaction fee.
What are the current exchange rates: Foreign exchange rate is the currency exchange rate at which one currency is exchanged for another. The exchange rate may change and is determined on the basis of fluctuations in the international market. It also differs from bank to bank.
You much check the overhead charges: There are charges for international money transfers that you must check before you want to send money overseas. This may be a fixed fee or a percentage of the amount that you want to transfer. Moreover, there may also be a foreign conversion charge as well as service tax for each participant in the transaction.
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Time Taken for International Money Transfer
If you have opted for wire transfers, the time that will be taken for transferring money to an international beneficiary is about five working days or more. Opposed to this, the time taken for online transfers is around one to two working days. This time also depends on the currency. If you are transferring money through demand drafts then the time taken will be longer than five days, which is the slowest.
FAQs
Ans. International money transfers are initiated at one place or country and are sent to another. Even if the person abroad has an account in the same bank as you, you will still have to initiate an international transfer. These international payments need a routing or SWIFT code.
Ans. For international money transfers, you can use credit cards and wire transfers.
Ans. If you have opted for wire transfers, the time that will be taken for transferring money to an international beneficiary is about five working days or more. Opposed to this, the time taken for online transfers is around one to two working days.
We hope this blog has cleared all your doubts about how international money transfer work. If you need financial assistance regarding studying abroad then feel free to reach out to Fly Finance.
