23 Jun 2023
With nearly 8 million overseas workers and expatriates, Bangladesh is the 6th largest country with most diasporas living in foreign countries and the 8th largest remittance recipient in the world. Most overseas Bangladeshis live and work in foreign countries and earn better and ensure financial support back home. There are numerous ways to send money to Bangladesh for these diaspora communities, but which is the best, and what are the essential considerations? How to make the best decision when sending money to family and friends? Before sending money, you probably have a lot of questions.
Everyone has doubts when deciding how to send money. This article will explain the fundamental differences between bank transfers and money transfer providers. It will also inform you of the most important factors to consider when transferring money to Bangladesh. Before talking about that, let's get a background check on the remittance flow in Bangladesh.
According to the World Bank, Bangladesh received $21.2 Billion in 2022 and $22.2 Billion in remittances in 2021, accounting for around 5.3% of the country's GDP. The quantity of money transferred to Bangladesh by the Bangladeshi diaspora is a remittance influx to Bangladesh. Aside from many Bangladeshi migrant labourers in Middle Eastern countries, many people living in industrialised countries such as Europe, the United States, and Canada have family members or relations in Bangladesh.
According to the BBC, Bangladeshis live in 162 countries via government and commercial networks. Their remittances are an essential source of income for Bangladesh and have contributed significantly to the country's economic progress. According to a World Bank analysis, Bangladesh is the world's third-highest remittance-receiving country in South Asia and the seventh-highest remittance-recipient country.
Bangladeshis living abroad can send money to family members in Bangladesh through authorised and listed foreign banks, money transfer organisations (MTOs), money exchange houses, and mobile banking services. Here is detailed information about them.
Money transfer companies guarantee quick, low-cost, and safe money transfers. You can also make a store deposit and transfer money to your loved ones. Some money transfer services let you start the process online and finish it in-store. You can transfer money through the money transfer organisations to the bank platform. This strategy is an excellent substitute for bank-to-bank transfers. It is more secure, faster, and less expensive.
You can easily send money to Bangladesh online through services like ACE Money Transfer. Signing up for an account is a straightforward and fast process. You will need your name, email address, and phone number to create an account. After you've set up your account, you can pay for your transfer with a credit card, bank transfer, or debit. ACE Money Transfer lets you send money via its website and mobile apps.
The service provides the best exchange rates with minimal fees. The process takes little time. Receivers can use many methods to receive their money in Bangladesh. The firm even allows cash pickups which is a beneficial service for people who are not much familiar with today's technology. ACE Money Transfer safeguard funds from fraud, money laundering, and other forms of theft.
Aside from money transfer services, there are various additional methods for sending money to Bangladesh, one of which is direct bank transfer, commonly known as a wire transfer. To make a wire transfer, the expatriate must go to the nearest bank and present the recipient's bank account information, including the bank's name, branch name, account number, and routing number. Sometimes, the sender may be requested to submit additional documents, such as a government-issued ID.
Fees for wire transfers are standard and include costs from the sender's bank and any intermediary banks engaged in the transfer. These fees must be paid for the transfer to be completed. The bank will conduct the transfer after you provide all the required information and fees. The time it takes to execute the transfer is determined by various factors, including the banks involved and the destination country.
They have some drawbacks as well. Bank transfers usually take around 3-5 business days or longer, especially when sent internationally. You must confirm whether the bank can send funds in the recipient's local currency. Wire transfers can be costly, and some foreign governments impose exorbitant fees for the service.
You must consider the foreign exchange rate your bank will use for the financial services supplied along with all these fees. They will also not offer you the current live rate. Instead, they charge a higher, negotiated fee to generate a bigger-than-average profit on your transaction. Sometimes the overseas bank is unable to accept remittances immediately.
If you want to benefit from every international money transfer to Bangladesh, use ACE’s services that offer competitive exchange rates yet at the lowest transfer prices alongside several opportunities to participate in promotions and win rewards.
Before making a transaction, you should know Why is online money transfer to Bangladesh better than other methods? For the millions of Bangladeshi diaspora, there is a progressive change of allegiance from banks to money transfer service providers. There are numerous explanations for this phenomenon. Some of the motivations for transferring money to Bangladesh include the following:
Setting up a money transfer service to send money is quite simple. Signing up for an account requires your email address, phone number, and name. Once you're set-up, you can pay for your transfer using a bank debit, bank transfer, debit card, or credit card and transfer to your loved ones via the website, a store, or a mobile app.
The foreign exchange rate, or FX, is the most significant factor. In money transfer transactions, foreign exchange refers to the exchange rate used by your service provider to convert your home currency into the receiving currency. Because the rate is applied to the total amount, it is more essential than the transaction cost.
Providers exist who offer their services in over 100 nations and territories. You should choose a provider who offers this service as it is necessary to work with many currencies.
Money transfer firms invest in advanced identity masking and multifactor authentication systems. These safeguards keep hackers out of your money and other sensitive information.
Transfer technologies and payout-network relationships enable providers to move money considerably faster than banks. It is possible to send money to your family and relatives in minutes or less than an hour. During an emergency, time is of the utmost importance.
The transaction fee is another parameter that helps us choose the best service provider. Money transfer companies use their enormous volume of transactions to bill their customers modest costs. Because of competition and investment in superior technologies, several money transfer providers have reduced their pricing to benefit clients. What matters in cross-border money transfers is cost transparency. Also, ensure that the recipient will not be charged for the incoming transfer. It's always better to be aware of the final service cost before transfer than to be surprised afterwards, right?
So, to begin with, the transaction limit depends on how you use the app. If you go through the full KYC (Know Your Customer) procedure, you will have higher limits to sending money than in cases where you can download the app and send funds without proper identification. It also depends on the recipient's credentials. For example, if you send money to a bank account, the limit will be higher than using a mobile wallet or credit card.
Last but not least, consider the recipient's credentials, whether you want to transfer money to a credit card that your recipient can immediately spend or a bank account that may require further procedures such as cash withdrawal, etc. The Pandemic clearly outlined a trend in which physical branches are no longer relevant, and everything should occur online.
Bangladeshis living in other countries can send money to family members in Bangladesh by using authorised and listed foreign banks, money transfer agencies, money exchange houses, and mobile banking services. Bank transfers are common but ineffective since they have more disadvantages than benefits. Money transfer providers such as ACE Money Transfer make it simple to make an instant and economical online money transfer to Bangladesh. You can pay for your transfer with a credit card, a bank transfer, or a debit card. You may send money through ACE Money Transfer's website and mobile apps. Choosing a money transfer service is better than using a bank.
FAQs
What are the main differences between using a bank and a money transfer service to send money to Bangladesh?
The main differences lie in the cost, speed, convenience, and delivery options. Banks often charge higher fees and offer poorer exchange rates, but they're generally perceived as safer. Money transfer services, on the other hand, usually offer more competitive rates, faster transfers, and options to send directly to a bank account, a mobile wallet, or for cash pickup.
Is it safe to use money transfer services for sending money to Bangladesh?
Yes, it is generally safe to use regulated money transfer services. These companies must adhere to stringent financial laws and are often supervised by financial authorities. However, it's always a good idea to check the reputation and reviews of the money transfer service you choose.
Why might someone choose a money transfer service over a bank to send money to Bangladesh?
People might opt for a money transfer service due to the lower fees, better exchange rates, speed of the transfer, and convenience. Also, money transfer services often offer various delivery options, including direct deposits to bank accounts, cash pickups, and even mobile wallet transfers.
How do exchange rates offered by banks and money transfer services differ when sending money to Bangladesh?
Banks often add a markup to the mid-market exchange rate, which means you may get a less favourable rate compared to money transfer services. Many money transfer services use the mid-market rate and earn their revenue through transparent fees, offering more competitive rates for their customers.
What factors should I consider when choosing between a bank and a money transfer service to send money to Bangladesh?
Consider the cost (fees and exchange rates), the speed of the transfer, the convenience of the service, the delivery options available, and the level of customer service. Also, review the reliability and security of the service provider. Depending on your specific needs, one may be a better fit than the other.
