How To Choose The Best Money Transfer Platforms
Money is a store of value. It is an instrument that is transferred from person to person by its very nature. The rapid pace of globalization that has occurred over the last fifty years has brought with it the need to transfer money over vast geographical distances, sometimes even to the other end of the world. Over 68 billion dollars were transferred to middle and low-income countries from the United States of America.
There was a time when making such transfers meant standing in lines at the bank or going to the nearest post office. However, advancements in technology have made the process of transferring money much more convenient.
Today it is possible to sit in your living room and transfer money to your family at the other end of the globe using your smartphone. This revolution in money transfer services is not just restricted to long-distance or international money transfers. You can transfer your share of the restaurant bill to a friend at the single click of a button. You don't have to worry about exact change or even bother pulling your wallet out of the pocket.
Whether your money transfer needs are business-related or personal, domestic or international, immediate or deferred, there are a plethora of options to choose. With each platform touting their unique set of benefits, it can be hard to decide which one to use for your money transfer needs. Here we'll break down all the factors involved so that you can make the best choice.
General Considerations
These are some factors that must be considered, irrespective of what your money transfer needs maybe. A good money transfer platform should tick all these boxes before you even start considering other features.
Cost
Nobody wants to lose their hard-earned money to get it transferred from place to place. This is why the transfer fees will remain a key factor in choosing a money transfer platform. The average transaction fees for international transfers have been an exorbitant 7%. The United Nations is aiming to get this reduced to 3% by 2030.
Low pricing is something that most people instinctively consider. But this is only one half of the cost factor. The other often overlooked aspect is transparency. You don't want to be fooled by platforms that advertise free or cheap fees only to hit you with hidden charges like exchange rate mark-ups or recipient side charges. An affordable and transparent pricing structure sets the base for a winning online money transfer.
Some operators offer no fixed rate. These operators charge based on the amount transferred and the location. So make sure you browse through their tariffs to know if they fit your requirements.
Security
The leaps in technological advances have not only improved the speed and efficiency of money transfers but have also made them safer. But still, over 900 million dollars of financial fraud has been reported in recent years with money transfers being the contributor. The only thing worse than incurring high transfer fees is to lose the entire amount. So it is of utmost importance that the transferred funds are safeguarded and delivered only to the intended recipients.
Always choose a licensed money transfer platform with an impeccable record of complying with regulations. The best platforms will also help you track your transfers so that you can rest assured that your money is safe.
Customer Service
As a customer, you don't want to feel helpless if you face any problems with your transaction. Money transfers do get delayed or in some cases, even fail. This is where customer service plays a role in resolving your confusion. You'll want to go for a platform that offers prompt and efficient customer service that is available round the clock and accessible via different mediums like the phone, email, etc.
Need-based Considerations
Certain factors need to be considered based on your specific money transfer requirements. Not all features may benefit your particular needs, and some features may be more important than others. However, to make sure you don't miss out on considering any aspects, we've listed down some factors that may or may not apply to you depending on your purpose for transferring money.
Speed
Speed can become an essential factor when money is required for emergencies or some immediate needs. An important aspect to consider is the geographical location. Some platforms are quicker for domestic transfers while others specialize in international transfers. The particular area where you want to send money to plays a role as some platforms offer services to certain countries.
We would all prefer that our transfers happen as fast as possible, but understand that speed often comes at an additional cost. So if you don't need the funds to reach within minutes, it would be a waste of money to pay higher fees for faster transfers.
Transaction Limits
The amount of money you want to transfer can play a role in choosing the right platform. This is because the minimum and maximum transaction limits vary across different platforms. The transfer fees charged also varies with the transferred amount. There may be platforms whose basic prices are comparatively expensive, but these charges are discounted or waived off if the transferred amount is sufficiently large.
The regularity of money transfers also becomes a key factor as some platforms are better suited for multiple small transactions while others cater to large one-time purchases.
Connectivity
The reach offered by a money transfer platform can be vital if you need to transfer money to different locations. It is cumbersome to have to rely on different platforms for different places. A platform with a robust global network can serve as a one-stop solution for all your money transfer requirements.
Payment Options
The best money transfer platforms offer multiple payment options to their customers. These include online options using bank accounts, credit cards, debit cards, mobile wallets, and even cryptocurrencies. While these online options are undoubtedly quicker, the flexibility to use traditional methods like cheques and demand drafts also adds to the allure of a platform.
Multiple payment options are a great feature but ensure that you make a note of any differential pricing based on the payment method selected as this can directly add to your cost.
Delivery Options
There are cases where either the sender or the receiver may not have a bank account. This is where delivery options come into play. Sophisticated money transfer providers offer cash collection through local collection partners or even provide home delivery of funds.
Exchange rates
This is applicable if you make international transfers. It is best to choose a platform that offers the best exchange rates. So make sure you compare the exchange rates by various platforms. Exchange rates are variable, and some platforms help you track the exchange rates. You can set the desired price and receive notifications when that rate is available.
Value-Added Services
There are a multitude of complementary features that make the experience of using money transfer platforms convenient and easy. These include quick and easy options to initiate payments, automation of payments, regular updates and notifications, well-designed user experience, offers and discounts, and wide adoption in the market. Some money transfer platforms also bundle other useful services like financial planning, investment options, and e-commerce.
Final Words
The rise of financial technology has transformed the money transfer marketplace into a competitive and innovative field with a variety of different services. The key is to understand your own immediate and long term requirements through the research of the available options as it can translate to tangible savings. While the right platform will vary from person to person, the smart ones know that the right platform can also vary based on the type of transfers that need to be made. So just sticking to a single platform for all your money transfer needs may not be the best decision.
