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Various Forms Of Sending Money Home

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Explore Certain Facts About The Various Forms Of Sending Money Home

Sending Money transfer refers to the process of transferring money in three modes P2P (Person to Person), P2I (Person to Institution), I2I (Institution to Institution). This whole process can be done by both account to account transfer and direct cash deposit.

In the process for sending money transfers, initially the entity (person or Institute) has to approach bank and do the formalities required for money transfer. The entity must specify the exact amount he wishes to transfer to another party. At the end, entity shares the IBAN and BIC codes to the bank to avoid faulty delivery.

After this the bank sends message via secure system (such ass SWIFT or Fedwire) to the receiving bank, to state the transfer instruction. With this the process of transfer starts. The actual transfer of money takes from few hours to few days for actual transfer to take place from one account to another.

The payment of service is levied on both sender and receiver. There is different mode of deduction by sender bank, intermediate and receiving bank. Sender bank collects fees separately while intermediate and receiving bank levies their transfer charges on the money being transferred; as a result the receiver receives less money then what was initially transferred by the sender.

Today there are many methods of money transfer available in the financial industry as stated below:

  1. FX Global Transfer – This is low cost transfer, depending on the exchange rate offered. In this method the currency dealer adds a spread around currency. So when someone wants to sell one currency and buy another, he encounters difference between the price between the primary and the currency he intends to buy, here lies the transfer charges of the dealer.

  2. Online Money Transfers – This is the most common, fast and widely used method mostly because of the increasing use of information technology and also because these services does not require any bank branches and actual physical transactions to take place. This low cost service requires that the sender uses the internet banking facility of the primary bank from which he wishes to transfer money.

  3. Retail Money Transfer – This is common for people employed in international locations. Companies like Western Union Money Transfer provide such services. In this the sender need not to have any account with the bank and simply can send the money with the help of retail banking. But with increasing money laundering and terrorist attacks, Banks have been very careful with the sender’s information and money transactions.

  4. Other Forms of Electronic Transfers - All transfers apart from wire transfer comes under this category, the two differ in important legal ways. Electronic Funds Transfer System (EFTS) is one of such system. The major difference being- wire transfer is more like an electronic cashier's check whereas an EFTS payment is an electronic personal check, This method is used when the sender sends money to receiver and either of them uses third party account (someone else’s account) for the transfer. These days this method is also very common for online bill payment option.

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