Cheapest Way to Send Money to India

Cheapest Way to Send Money to India

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After lots of experimenting, I’ve found the cheapest and safest way to send money to India (and a selection of other countries). For anyone that’s not familiar with my blog, probably most of you reading this, I run a few physical products brands with manufacturing factories abroad. Thus, sending large amounts of money to countries such as China, Pakistan, India and the USA has become commonplace.

Below, is a short breakdown of how I do it cheaply and my reasoning why – I hope this helps you to start doing the same!

Sending money with the bank vs an online service

When I started sending payments abroad, I did what I think most people would do, I physically walked into my bank here in the UK and sat down with a staff member to do the deed. This seemed like the logical thing to do. Perhaps it was, however, I now feel like a bit of wally knowing what I do.

NatWest were charging me in the region of £30 as a fixed fee for international payments regardless of size. You also need to negotiate with the recipient if they will pay the fees to receive the payment or whether the sender is responsible for the lot.

Add to this a sneaky (read: bad) exchange rate from our trusty banks and you are paying a ridiculous price for something that should be a very simple task with today’s technology.

Some more money posts that may interest you:

After a few months of this back and forth, my patience with the bank was wearing thin, and my payments were increasing in size – I needed an alternative.

A comparison of payment methods I considered

So, I was driven to look online for a more cost-effective way of sending money abroad. Here’s a list of the alternatives that seemed to offer the service, I’ve used the example of sending £1000 from the UK using each of the services below:

Table: Total Cost to Send £1000 from the UK to India

ServiceAmount ReceivedTotal Cost (including all fees and exchange rates losses)
TransferWise 90,527 INR £5.96
Remit2India 90,420 INR £7.12
Xoom 90,316 INR £8.27
WorldRemit 90,088 INR £10.76
Barclays 88,762 INR £25.27
Western Union 88,724 INR £25.69
NatWest 87,003 INR £44.52
PayPal 86,781 INR £46.96

Conclusively, you will note that a company called TransferWise are the cheapest service provider with a total cost of £5.96 and leave the recipient with the most money.

Top tip – use the TransferWise price comparison on their website here for a cost comparison of most major services (very handy!!).

Consequently, I started researching TransferWise, as I had never heard of them. Spoiler alert, they are great and I now use them every time I need to send money to India or any other country abroad.

An introduction to Transferwise

TransferWise is an online money transfer service, which enables the average punter (or business) to transfer money around the globe up to 8x more cheaply than using your bank. The surprisingly simple system utilises two local transfers, instead of one international transfer to keep fees very low.

The platform was launched in 2011 by the first-ever employee at Skype. It’s also backed by Richard Branson (Virgin) and Peter Thiel (PayPal) – certainly sounds credible enough for me.

My full TransferWise review can be found here: The ULTIMATE TransferWise Review | How Does it Work | TransferWise vs PayPal vs Revolut

How is it so much better than the competition?

Consider this example:

If you want to convert pounds to rupees i.e. send money to someone in India, you send the money in GBP to TransferWise’s UK-based account. Here’s the clever bit, TransferWise will then send the equivalent amount from their India-based account to the recipient.

Fantastically, this means that money never actually crosses a border. It’s devastatingly simple and unfortunately demonstrates how banks have been ripping us off for years.

Currency Conversion Rates and Fees

Now let’s talk conversion rates.

All payment services will hit you with a fixed fee and/or bad conversion rate where they will take some profit.

TransferWise use the real mid-market exchange rate, the same one you will find on Google/Reuters/ etc. Why is this important?

This means that they make no money from you here, all their profits are made from the fixed fee that they advertise at the start of the transaction.

I understand that the company can operate on these lower profit margins due to their clever local banking system (as I talked about above), and because they operate solely online with no physical footprint.

On the presumption my rambling read with little coherence, here’s a video to help explain how the company works:

Of course, the next thing I asked myself, is this company safe and how long will the transfer take?

Is TransferWise safe?

After speaking to a representative of the company, it’s apparent that TransferWise is a licenced Authorised Electronic Money Institution.

This means simply that they are regulated by the Financial Conduct Authority (FCA) and in the UK, Her Majesty’s Revenue and Customs (HMRC). Where it operates in other countries, it’s regulated by the respective institutions.

For example, in the US, they are registered with the Financial Intelligence Unit (AUSTRAC) as money remitted TransferWise Inc. and are registered with the Financial Crimes Enforcement Network (FinCEN).

Although expected nowadays, they use institution-grade security such as HTTPS encryption and two-factor authentication (2FA).

Like large financial institutions, TransferWise verifies its users to protect against fraud and money laundering too.

How long do transfers take?

Every transfer that I’ve made to Europe has taken less than one working day to arrive.

Transfers to people and businesses around the globe, China/USA/Pakistan/India take between 1-3 days.

This is very fast considering banks take 3-7 working days to achieve the same task.

Handily, TransferWise send you emails to keep you updated on the payment’s status, so you know what is going on!

Now we’re all on the same page, here’s a quick step by step guide to sending that £1000 to India.

Tutorial using £1000: the cheapest way of sending money to India

Head over to the TransferWise website and create an account.

Click ‘Send money’.

Transferwise send money

Enter the amount you want to send in the top box, or the amount you want the recipient to receive in the bottom box. You can compare prices to make sure you are getting a good deal. Then select ‘Continue’. (Note: For the observant ones, I have written this post over two days which is the reason for the exchange rates being slightly different).

cheapest way to send money to india

Select who to pay.

Transferwise send money recipients

For new recipients, enter their details and click Confirm. Note, if you don’t know their bank account information you can make the payment using just their email. They will be contacted for their own information if you choose this option.

How to pay on TransferWise

Finally, enter your debit card or bank account information to send the payment.

Parting thoughts

I hope this breakdown has been useful and has helped explain why they are the cheapest way of sending money to India. All while being safe and transparent with a swish, easy to use website.

Since I started using TransferWise, I haven’t used anything else. I constantly refer people to them so decided to write to them asking to become an affiliate. They agreed, so if you’ve found this helpful and do decide to give them go, using the links on this site will buy me a cup of coffee at no cost to you – cheers!

Take care,

Dom Sign off

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