Sending money overseas

Sharing your wealth

If you have friends or family overseas, you may want to send them money at some point, like for a wedding, a medical expense or just to help with everyday expenses. Here are some tips to help you pay less fees and avoid problems when you transfer money abroad.

Compare costs and exchange rates

Smart tip

Some companies may charge a 'margin' to convert your currency even if they say they are 'commission-free.'

A number of websites can help you to compare companies that send money overseas.

  • SendMoneyPacific - For money sent from Australia to Fiji, Kiribati, Papua New Guinea, Samoa, Solomon Islands, Tonga, Tuvalu and Vanuatu.
  • SaverAsia - For money sent from Australia to Cambodia, Indonesia, Lao PDR, Myanmar, the Philippines, and Vietnam.
  • Remittance Prices Worldwide - The World Bank's website for other international transfers.

Shop around for a good exchange rate

For larger transfers, it's worth shopping around for a good currency exchange rate. A small difference in the exchange rate could mean a lot more or a lot less money in your recipient's bank account.

Also find out if the exchange rate is guaranteed. Not all companies guarantee the rate; but, if they do, you'll know exactly how much money your recipient will get.

Warren Day talks about sending money overseas

ASIC Victorian Regional Commissioner Warren Day talks to SBS about shopping around for a good exchange rate when sending money to friends and family overseas.

Warren Day interview on SBS (9 mins)

Narrator: Around the globe, more than 250 million people live outside their country of birth and many migrants choose to send money to families back home.

Australians are also transferring more money overseas than ever before, but the hidden costs can be hefty.

Like many other Vietnamese migrants, Emma Tran sends money to her elderly parents.

She feels responsible for paying back some of the debt they incurred for raising her.

Emma Tran: They don't need my money but I want to give them back a little bit, so sometimes I send them money for a ceremony or for a gift for them. Although they don't need it, they are happy to receive it.

Narrator: Emma Tran says in Vietnam adult children are obliged to look after their parents and other family members in their old age.

Emma Tran: For Vietnamese people it is like a culture that when children grow up and they have responsibility to take care for their parents.

Narrator: Vietnamese migrants from around the world send about 10 billion dollars to families back home every year.

About 10 per cent of this amount comes from Australia.

Emma Tran says many of her friends send money home and these payments can be an important part of the income of siblings and relatives.

Emma Tran: Most of them they need to support their family in Vietnam because - you know - compared, the living standard in Vietnam and Australia, the living standard in Vietnam is worse. Many families in Vietnam are still living in a poor condition.

Narrator: There are many ways of transferring money overseas.

Emma Tran prefers to use her own bank.

Emma Tran: I use as main transfer to send money from bank to bank. For me that's a simple way to transfer. But most Vietnamese people they use Vietnamese agencies.

Narrator: Using a bank is one of the easiest ways of sending money overseas but it is also the most costly.

Every Australian bank will charge a different fee for their services.

Usually it's between $10 and $32 for each money transfer.

When it comes to sending smaller amounts of up to one-thousand dollars to family and friends, cheaper options are 'non-bank' money transfer companies.

Their transfer fees vary between $0 and $15 for small amounts.

However, the transfer might take longer because setting up an account and getting approval can take a few days.

Another important factor to consider is the daily exchange rate between the Australian dollar and other currencies.

Warren Day, Regional Commissioner Victoria of the Australian Securities and Investments Commission says, a good exchange rate means more money for those who need financial support.

Warren Day: There are lots of options but you should shop around for a good exchange rate. This could mean the difference between more money or less money in the bank account of the person you are sending the money to.

Narrator: He says there are few complaints about money transfer operators in Australia, but customers should always take care and be comfortable with whom they use.

Warren Day: You can compare companies that send money overseas on several websites which are supported by the World Bank. They include SendMoneyPacific and SendMoneyAsia. Again, make sure you do your research before using a money transfer service because if you're not careful you could fall victim to a money transfer scam and it's almost impossible to get your money back.

Narrator: Abdimalik Abdi is the director of Dahabshiil, a money transfer company in Sydney's Western suburbs with a focus on countries in east Africa.

Abdimalik came from Somalia 20 years ago.

He says that like many of his customers, he is also sending money back home.

Abdimalik Abdi:  I'm sending to my mom back home since I was here. So I have to give them support to do their normal house expenses. The money they get from here is their lifeline.

Narrator: Sending money through a 'non-bank' transfer service is not difficult and only requires a check of identity.

Abdimalik Abdi:  In money transfer you need the details of the person who is sending the money and the details of the person who receives the money. That is the main thing. You have to provide your ID or passport or driver license to prove you are the actual person who is transferring the money because in Australia there is a regulation, the money transfer regulation.

Narrator: Once the identities of the sender and the recipient have been established, the actual money transfer only takes minutes and all fees are paid by the sender.

Abdimalik Abdi:  When a person sends money, we give a receipt and a transaction number, so this person in here can send this message to the person over there. So, this person in Africa can go to our branches and offices back home with the transaction number and receive the money straight away, sometimes within minutes.

Narrator: But what happens if the money sent never arrives?

Warren Day says the first complaint should go to the company that handled the money transfer.

Warren Day: If they are not able to find your money or you're not satisfied with the response you're getting from them, you can complain to the financial ombudsman service. You can call them on 1800 367 287. You can also visit ASIC's Money Smart website, that's for more guidance.

Narrator: Different transfer agencies have different limits on the amounts of money they allow customers to send overseas.

However, under current Federal legislation, all Australian financial institutions are required to report cash transactions of $10,000 or more, including details of the relevant account holders, to the regulator AUSTRAC.

The Australian Transaction Reports and Analysis Centre monitors financial transactions to identify instances of money laundering, organised crime and tax evasion.

Ways to transfer your money

There are a few different ways to send money from Australia to another country.

Smart tip

Keep your receipts and the transfer documents safe. Note the time limit for claiming a refund, in case your recipient doesn't claim the funds.

Online money transfer company

Online transfer companies ask you set up an account online and let you transmit your money yourself using the internet, or even a mobile phone network. The company moves the money to your recipient's bank account or arranges for them to collect the cash.

This transfer method can be cheap and fast, but you need to be comfortable making online transactions and know the bank account details of your recipient.

Bank account transfers

Using your bank account, you can transfer money directly into an overseas bank account. It is also called an international money transfer, a telegraphic transfer (TT), or a wire or SWIFT transfer.

Some banks also have online money transfer services that allow you to send money yourself to an overseas bank account.

This can be a more expensive option and it could take 2 to 5 days.

Cash transfer (through a money transfer company)

Money transfer companies let you transfer your money overseas using cash or EFTPOS. You might approach a money transfer company at their store front or use a third-party convenience store counter. The person you send the money to will collect the cash at the money transfer office in their country.

Some money transfer companies will also let you transfer money using the internet, phone or a bank card once you've set up an account with them. You will need to let the recipient know that you've sent the money, and that they can pick it up from their local office.

This kind of transfer is often very fast - it could take just a few minutes - but can be expensive.

Australia Post also offers cash transfers which can be done at all Australia Post offices that have the Bank@Post sign displayed. To find out more see Australia Post overseas money transfer with Western Union.

International Money Order

A safer method than sending a personal cheque overseas is to use an international bank draft. You give your money to a bank in return for an international guaranteed cheque. You post the cheque to your family who then need to cash it at a local bank or deposit it into their account.

While secure, this transfer method can cost more than others, and posting it will be slower than an electronic transfer.

How to complain if you have a problem

If the money has not been delivered, both you and the recipient should speak to the company that is transferring the money. If it still cannot be found, then you can complain to the Australian Financial Complaints Authority (AFCA).

Money transfer scams

If you send money to someone and they turn out to be a scammer, it will be almost impossible for you to get your money back. Be very careful who you send your money to. Visit the SCAMwatch website  for more.

Do your research before sending money overseas. You could save yourself a lot of money and time.

Related links

Last updated: 15 Mar 2019