Best Ways to Send Money to India

Updated on: 2019-11-15 - 5 mins read

In today’s competitive world, comparison has become necessity of time. You will have multiple options/ways for everything. Indeed, very true when it comes to save money. If you are working abroad, you might have thought about the best ways and best time to send money to your home country. As per World Bank’s Bilateral remittance matrix (2017), approximately US$ 11.7 Billion money is transferred from USA to India. If you are one of them to transfer USD to INR to your family, friends and relatives, RemitAnalyst’s Comparison platform (RemitAnalyst) can help to find best exchange rates among various money transfer service provider companies. Each money transfer company has strengths and weaknesses, so learn about the options and find out what works best for both, sender and receiver.

Here is a brief comparison of various remittance service providers:

There are some other popular ways of sending money to India are stated below:

ACH (Automated Clearing House) Transfer

ACH is a network which processes interbank transactions. Examples of ACH transfers include employers depositing money into their employees’ checking account, business-to-business fund transfers, and people transferring funds from one bank account to another bank account. No need to go to banks or pay extra fees to initiate this type of transfer. It takes typically 1-5 days to receive money in recipient’s bank account.

Debit Card

Debit cards can be used to send money to India. Some debit card companies transfer money with zero transfer fees but with less competitive exchange rates, whereas some companies give best competitive rates, but Mcharge transfer fees. So before you initiate Money transfer, be aware of any transfer fees /exchange rates. It is not recommended unless you have some emergency and you need funds instantly.

Credit Card

Credit cards can be used to send money to India. However, It will be an expensive option, because you will have to pay a high interest rate as “Cash Advance”. Another drawback is less competitive exchange rate when transferring money using credit card. It is not recommended option, unless there is an emergency and you don’t have any other way to fund your money transfer.

Wire Transfer

A wire transfer is used to transfer funds electronically from one bank or financial institution to another. In this type of fund transfer, no physical money is transferred between banks or financial institutions. Only recipient’s details such as name, address, the bank receiving account number, and the amount transferred is passed between banking institutions. The sending bank sends a message to the recipient's bank with payment information through a secure system such as SWIFT & Fedwire. The recipient's bank receives all the necessary information from the initiating bank and deposits its own reserve funds into the correct account. Once the money has been deposited, then the two banking institutions settle the payment on the back end. That’s why no physical transfer is made during a wire transfer. Sender and recipient’s identity needs to be disclosed to avoid anonymous transaction. Drawback of wire transfer is upfront cost that sender has to pay while initiating transaction. International wire transfers costs around $25-$45. International wire transfers are normally delivered within two business days.

Money Order, Cashier’s check & Foreign bank Drafts

All three options are almost similar with minor differences:

Money Order: It is a piece of paper which is used as a safe alternative to cash or personal checks. You need to specify who will receive the money order, and both you and that person must sign it for it to be valid to avoid theft. One can buy (prepay) money orders at banks as well as at various locations such as the post office, credit unions, Walmart or Western Union. For bigger amount, you can have multiple money orders. Money orders offer more protection than either certified checks or cashier's checks to both senders and recipients. The payer gives a financial institution a certain amount of cash, and the financial institution issues a money order that they will honor using the received cash upon redemption.

Cashier’s Check: Bank or credit union provides cashier’s check with amount and the name of recipient on it. The recipient uses that check to collect funds from the bank. It can be requested through any banks via in person or online. Before you request a check, make sure you have enough funds available in your bank account or you can bring cash to the bank. Cashier’s check is generally used for high dollar amount transfer between people/businesses that don’t know each other. It is the same as certified check just with additional security for sender and receiver.

Foreign Bank Drafts: When you need money in foreign currency (or of the country you want to send money to), foreign bank drafts can be purchased at banks. It is purchased in one country and made payable in another country. As Bank draft is made out in the local currency where it will be sent, conversion is not required. Therefore, you get money quicker than a check written in USD, but still slow as compared to other viable options. Bank drafts must be deposited into a bank account, it can not be cashed. The moment you ask bank for Bank draft, it converts money from USD to INR (US Dollars to Indian rupees). International bank drafts don’t bounce like personal checks. Sending money to India through bank drafts is very slow and typically takes a couple of weeks.