Money remittances to India: All you need to know
11:30AM Mon 26 May, 2014
Many of us have a myopic view of transferring money, looking only at the currency exchange rate. We don’t bother with the bigger picture: how to make the most of the transfer to get the biggest bang for your buck. Here’s a quick rundown of what you need to remember when sending remittances home.
Agent network
You’re likely to find plenty of options to send money home at all the money exchange houses in the UAE. Most offer well-known systems such as Western Union and Moneygram, but an increasing number of exchange houses are now offering their own services such as Al Ansari Exchange’s Cash Express.
Additionally, you’ll find services dedicated to particular countries, such as Everest Remit and Himal Remit, both of which specialise in sending remittances to Nepal. Whichever service you choose, make sure the company has an adequate network of agents in your destination country to ensure the recipient can receive the money quickly and easily. There’s no point in using a cheaper service if the person receiving the money will have half a day’s travel to collect it.
Adequate identification
You’ll need to identify yourself to the exchange house staff through a valid passport or Emirates ID. Also, you can’t be both the sender and the recipient when sending money home. So if you’re intending to collect it on arrival when you go home on vacation, you’ll need to take someone else along to send the money.
Beneficiary details
Basic information, yes, but easily forgotten if you’re in a rush. Make sure you have all the details of the person you’re sending money to and ensure you know the correct spellings. If you’re sending a remittance to be collected at a money exchange house in your destination country, you’ll also need a phone number for the recipient.
Familiarity with rules
Most countries have a choice of banks and financial institutions that deal with incoming money transfers, so you’ll be able to weigh the pros and cons of each and choose the best available rate.
Remember, however, that they may have limitations on how much can be sent in one transaction. For example, some banks in the Philippines only allow a maximum of 50,000 Philippine pesos (about Dh4,195) in one remittance, so even if their rate is the best you won’t be able to take advantage of it if you want to send more than this amount.
One of the best ways to make sure you don’t get caught on the wrong foot with changes in rules and regulations is to regularly check financial news from your home country so you’ll be aware of any new legislation affecting inward remittances.
Overall cost
While remittances aren’t services you’re likely to get a discount on — a quick scan of money exchange houses in the UAE reveals considerable consistency in remittance charges — it might be worth double-checking if you can take advantage of any
other benefits.
Many houses run promotions and special offers as well as loyalty schemes for repeat transactions. It’s especially worth checking up on during holiday periods such as Ramadan and Eid. Other houses even organise promotional schemes offering customers the chance to win prizes.
The best rates
Exchange rates can vary according to demand, so you’ll probably get a better deal if you choose a quieter time to send money home.
Many workers in the UAE tend to send remittances close to holidays, such as Eid and Ramadan, which is when the rates are high. If you can avoid it, wait until the holiday period is over.
If you’re a regular sender, you’ll also notice variations in rates at different times of the day or week. Time your remittance accordingly; you might only gain a few dirhams a time, but in the course of a year, it will all add up.
Beware of hidden charges
When sending money overseas, paying attention to hidden charges could reap rewards.
“Shop around and you will discover ways to save significant money on foreign exchange transfers. Generally, standard rates offered by banks are not competitive. Specialised money transfers can save you up to 5 per cent,” says James Thomas, Financial Planner, Acuma, a financial services provider.
When making a remittance, find out if there are little extras that the service provider is adding to your tab. These not-so-obvious add-ons can be in the form of poor exchange rates and back-end fees that apply to money transfers in certain markets.
Antony Jos, Director, Joyalukkas Exchange, says, “Premium products such as instant money transfer are offered at an extra cost. If customers choose to send money via bank transfer, they get more value on the transaction for a standard fee.”
If the method of wiring money is based on urgency, then the next consideration should be choosing a service provider based on the value-added services they can offer, adds Jos.
When it comes to money transfer fees most exchange houses offer the same rate, says Preeti Harrison Bhambri, Managing Director, MoneyCamel, a personal finance website. “A survey of the top five money exchanges revealed an average difference of only .04 fils. So the consumer does not lose any money as long as he is using one of the bigger exchange houses.”
A bank may charge Dh50-Dh75 for a money transfer, with the funds taking up to three working days to reach the beneficiary, says Bhambri. But exchange houses are more efficient and cheaper. The ongoing fee is Dh15 for small amounts and Dh20 for large remittances.
What you need:
1. Passport copy with visa page
2. Emirates ID Card
3. Work permit
4. UAE driving licence
5. eGate card
6. Sending amounts that are more than Dh40,000 requires proof of source
— Gulf News
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