10 Expert Tips to Save Money on International Transfers
International money transfers can be expensive, with traditional banks charging fees of 3-15% per transaction. Here's how to minimize costs and maximize value.
1. Compare Transfer Services
Don't default to your bank. Compare these options:
- Traditional Banks: Convenient but expensive (3-5% fees + poor rates)
- Online Transfer Services: Wise, Remitly, WorldRemit (0.5-2% fees)
- Cryptocurrency: Bitcoin, Ethereum (network fees vary, often < 1%)
- Peer-to-Peer Services: PayPal, Venmo (good for small amounts)
2. Understand the True Cost
Calculate the total cost including:
- Transfer fee (flat or percentage)
- Exchange rate markup (usually 1-5% above mid-market rate)
- Receiving bank fees ($10-25 for international wires)
- Intermediary bank fees ($15-30 if multiple banks involved)
3. Use Mid-Market Exchange Rates
The mid-market rate (also called interbank rate) is the "true" exchange rate without markup. Check it on:
- Konvertibly Currency Converter (updated every 60 seconds)
- Google Finance
- Reuters
Then compare what your provider offers. A 2-3% difference is common but avoidable.
4. Transfer Larger Amounts Less Frequently
Flat fees hurt smaller transfers more. Example:
- $25 fee on $100 transfer = 25% cost
- $25 fee on $1,000 transfer = 2.5% cost
If possible, consolidate transfers to reduce percentage cost.
5. Avoid Airport & Hotel Currency Exchanges
These locations charge the highest markups:
- Airport kiosks: 10-15% markup
- Hotels: 8-12% markup
- Tourist area exchanges: 7-10% markup
Instead, use ATMs in the city or online transfer services before traveling.
6. Choose the Right Transfer Speed
Faster isn't always necessary:
- Instant (1-24 hours): Highest fees (2-4%)
- Standard (2-5 days): Moderate fees (0.5-2%)
- Economy (5-7 days): Lowest fees (0.1-1%)
Non-urgent transfers can save you significant money.
7. Monitor Exchange Rate Trends
Exchange rates fluctuate daily. Waiting for favorable rates can save 2-5%:
- Use Konvertibly's historical charts to identify trends
- Set rate alerts (many services offer this)
- Avoid weekends when markets are closed (worse rates)
- Consider forward contracts to lock in rates for future transfers
8. Reject Dynamic Currency Conversion (DCC)
When paying abroad, merchants may offer to charge you in your home currency. Always decline.
DCC adds 3-7% markup. Pay in local currency and let your bank convert at better rates.
9. Use Specialized Money Transfer Apps
Modern fintech companies offer better rates than traditional banks:
- Wise (formerly TransferWise): Mid-market rates, transparent fees
- Remitly: Great for remittances to developing countries
- OFX: Good for large transfers ($10,000+)
- Revolut: Free up to certain limits, great for travelers
10. Consider Cryptocurrency for Large Transfers
For large amounts ($5,000+), cryptocurrency can save money:
- Bitcoin/Ethereum: Network fees typically < 1%
- Stablecoins (USDC, USDT): Minimal volatility risk
- Lightning Network: Near-instant Bitcoin transfers for pennies
Caution: Only use if both parties are comfortable with crypto and can convert back to fiat easily.
Real-World Example: $5,000 Transfer Comparison
| Method | Fees | Exchange Rate Markup | Total Cost | Recipient Gets |
|---|---|---|---|---|
| Traditional Bank | $45 | 3% ($150) | $195 | $4,805 |
| Wise | $25 | 0% (mid-market) | $25 | $4,975 |
| Cryptocurrency | $5 | 0.5% ($25) | $30 | $4,970 |
Savings by avoiding traditional bank: $165-170 (3.3-3.4%)
Conclusion
International money transfers don't have to be expensive. By comparing services, understanding fees, and timing your transfers strategically, you can save hundreds or thousands of dollars annually.
Check current exchange rates for free: Konvertibly Currency Converter