For many, a job abroad is a turning point in their career. But does this make their liabilities any less burdensome?
For most Non-Resident Indians [NRIs], sending funds back home is unavoidable. The remittances could be for debt payments, investments, medical expenses, and so on. But not everyone is aware of the easiest way to transfer money to India. Thus, it often becomes expensive and time-consuming. Knowing the facts about traditional remittance and online remittance will clarify which should work best for you.
Traditional remittance vs online remittance
Benefits of using traditional remittance services
- Funds transferred through traditional agencies and banks are completely secure. You can pay using cash, bank deposit, or debit/credit card. And rest assured, your money is in safe hands until the beneficiary collects it.
- You can send funds even to remote areas. Traditional remittance agencies have a wide service network, which allows you to send money anywhere.
- Traditional remittance services offer direct cash transfer. The money is transferred electronically, but the recipient collects it in cash. It is particularly helpful when the receiver does not have a bank account.
Drawbacks of traditional remittance services
- The overall transfer cost is higher than for online money transfer services. This is due to the higher exchange rate charged by the transfer agency. Suppose the current exchange rate is USD 1 = Rs 69, but the transfer agency offers USD 1 = Rs 64. Therefore, for USD 1,000, the difference would be Rs 5,000.
- The transfer speed is quite slow. Usually, bank-to-bank transfers take up to five business days in case there is no working relationship between the banks.
- You do not have 24-hour access. Physical outlets have certain working hours. And transferring funds across different time zones can complicate matters further. So, you will need to keep the timelines in mind when sending money to India.
Why you should remit online
Online remittance facilities are slowly replacing traditional money transfer services. They are convenient, and you can send money to India easily from wherever you are.
Advantages of using online money transfer services
- Online remittance facilities offer faster and seamless money transfer. They allow you to complete the process with minimum time and effort. You can transfer money anywhere and at any time. There is no limit on the amount you can transfer either. Also, the transfer happens digitally, which means there is zero paperwork. It takes less time and spares you the hassle of submitting documents.
- Instant fund transfer within a few hours. Most online remittance services offer same-day money transfer. This transfer process is even quicker with RemitMoney. You can send funds directly from the USA, UK, Canada, and Europe to India within an hour.
- Less expensive than traditional money transfer services. Online money transfer services usually have a lower exchange rate and a minimum transaction fee, which brings down the overall transaction cost.
- You can track the status of your remittance through the website. Besides, you will receive periodic email updates on the transfer.
Disadvantages of online money transfer
As with all things, online money transfer is not without its share of drawbacks.
- It is not a good option for those with no bank account. As it involves an account-to-account transfer, having a bank account is crucial.
- You must have an active internet connection to make the transfer. Digital transactions are prone to malware attacks and online frauds. Doing a little research on this ensures you do not fall into the trap.
Bottom-line
As you can see, both the options have their benefits and drawbacks. Thus, you should always choose the service depending on your needs. However, online remittance does have some clear advantages over traditional remittance services. Online money transfer services such as Axis RemitMoney offer better exchange rates and lower transfer fees. This means, your beneficiary will receive most of the amount that you send.