What Is the Cheapest Way to Send Money?
If you’re looking for inexpensive ways to send money — either between individuals or in a business transaction — you have several options thanks to the robust digital finance sector.
Different services offer different options, and you should consider multiple factors before you settle on an option. This guide will help you find the payment services that you need.
Things to Consider When Looking for a Cheap Way to Send Money
There are several things that you should consider if you’re looking for an inexpensive way to send money. Above all else, you should consider fees, exchange rates, and transfer times.
Fees
You should always take fees into account and consider what types of fees that a payment service charges — not just how high or low those fees are.
A payment service may charge any number of fees, including but not limited to:
- Transaction fees
- Currency conversion fees
- ATM and withdrawal fees
- Account opening fees
- Account closure fees
- Maintenance fees
- Other recurring fees
- Hidden fees and surcharges
You should also consider whether these fees are charged at flat rate or are adjusted based on other factors. For example, you might be charged different amounts based on the size of your transactions, or based on how often you make payments.
Other factors — such as your country of residence and whether you are transacting as an individual or as a business — may also affect the amount of money that you pay in fees.
Exchange rates
Standard exchange rates help you estimate how much you might need to pay for a foreign transaction. However, payment services are free to set their own rates.
Though popular and consumer-oriented payment services often have high conversion rates, payment services that are aimed at businesses and professional users are sometimes willing to negotiate or adjust rates in cooperation with their customers. When in doubt, you should contact your chosen service to ask about their exchange rates.
Even if a payment service offers a low exchange rate, you should also take into consideration other fees that might make the service more expensive overall.
You’ll also need to consider how current market conditions affect exchange rates. Exchange rates fluctuate constantly regardless of how your payment service sets their own rate.
You should also note that exchange rates only apply to cross-currency transactions. If you plan to transact solely in your local country’s currency or in a single international currency (such as the euro), you do not need to consider exchange rates at all.
Transfer times
Most people and businesses expect timely transactions. Payments are often completed within minutes, hours, or a single business day, depending on the nature of the transaction.
Virtually all payment services are capable of meeting these requirements. However, some services offer multiple transaction speeds, and you might be able to pay lower transaction fees if you opt for slower, low priority, or economy transaction speeds.
On the other hand, if you are willing to pay higher transaction fees, your payment may be handled as a high priority or express transaction.
Other factors — such as the location of transaction participants and and the payment networks that are available to you — can affect the speed of your transaction. In this case, you might have little choice when it comes to transaction speeds and related costs.
Cheap Ways to Send Money Abroad
There are numerous ways to transfer money abroad, including:
- An EMI like Payset
- Bank transfers and wire transfers
- SWIFT transfers
- Payment Initiation Service Providers
- Cheques
- Money orders (eg. through Western Union and MoneyGram)
- Digital wallets such as Paypal, Google Pay, Apple Pay
- Debit/credit cards
- Prepaid or reloadable cards
Even though some of these options do not allow you to send money internationally in a direct way, it is often possible to fund a payment account with these methods.
The cheapest option depends on your circumstances, and none of the above options are the best in every instance. Instead, you’ll need to make effective transactions with whatever option you choose. Below, we’ll examine the best ways to save money while making a transaction.
Tips for Saving When Sending Money
Even if your payment provider sets specific rates and terms, you might be able to work within those limitations in order to save money. Consider these strategies.
Timing Transactions Based on Exchange Rates
If you need to convert funds to another currency as part of your transaction, you can get a lower conversion rate by timing your payments based on the forex market.
You should carry out transactions when your local currency is more valuable than others. In other words, when your local currency is strong, every dollar that you spend will be worth more to the recipient — and you will need to spend less of your local currency.
Keep in mind that this strategy only works if you are converting between currencies.
Bundled Transactions
Sometimes, you can save money by combining transactions and sending them together. If your payment service charges per-transaction fees, you might be able to save money by sending a single larger transaction instead of several small transactions.
However, this transaction bundling strategy will not help you save money if your service solely charges percentage based fees. Likewise, if you need to send funds to several different recipients, you might not be able to combine transactions in this way.
Promotions & Referrals
Some payment networks offer promotions and referrals. You can often take advantage of introductory offers by referring friends and family to the service.
Other services may provide an introductory offer to everyone who signs up, or to users who accept an invitation before they sign up.
By taking part in these introductory offers, you can receive account credit, benefit from reduced or waived fees, or gain other benefits. However, these benefits are rarely permanent, and you should always consider whether a service’s regular fees are affordable.
Some payment services offer regular promotions. These providers may also offer reduced fees to those who make large transactions or maintain large account balances.
If your payment provider is primarily focused on retail payments, you may be able to collect loyalty points that you can redeem for rewards, account credit, or cash. Each time that you spend money on qualifying transactions, points will be added to your balance.
Avoid Using Credit Cards
Credit cards are convenient for shoppers who make retail payments. They are inexpensive from a buyer’s perspective because the seller usually pays all necessary fees.
However, in order to send money to someone you know via credit card, you’ll typically need to rely on a third-party payment provider to handle the transaction. These payment providers usually charge fees to cover the cost of the card transaction — or to make a profit.
As such, credit cards can be an expensive way to send international transactions. They should be avoided in transactions between individuals or between businesses.
Though no single international payment option is always cheapest, you can usually pay low fees by sending payments between users on a single, shared payment service. Withdrawing money from a payment service may carry extra costs or fees.
Use Specialist Money Transfer Services (Payset)
Specialist money transfer services like Payset provide fee structures that are tailored to user spending activity, either broadly or individually.
Our fees take into consideration how you are sending money or receiving money, whether you are a business user or a personal user, and where your transactions will take place. We also provide conversion rates on request based on current market conditions.
This approach means that, as a Payset user, you can choose a fee model that is best for you. You can obtain a more precise estimate on our fee guide.
Hidden Fees
You should always be aware of hidden fees. Be sure to consider fees that are applied to inactive accounts, fees that are applied to international transfers or currency conversion, and fees that are charged when you draw funds from connected external accounts.
There is necessarily some uncertainty around fees due to the fact that payment services serve customers in different circumstances and amidst fluctuating exchange rates.
However, any reputable payment service should always provide you with the final cost of your transaction before you complete that payment.
Is My Money Safe?
Your money is safe with any reputable digital payment provider. If you are not sure whether a service is trustworthy, you can look up reviews on popular rating sites like Trustpilot.
You can also consider the area in which a payment service is regulated. For example, payment companies based in Britain generally need to register with the U.K. Financial Conduct Authority. This agency keeps records of companies that have filed with it, meaning that you can be sure that certain companies are approved by the country’s authorities.
You should also consider your own level of comfort with any given service.
Because payment services exist alongside bank accounts, you do not need to deposit more money than you need to transact or spend. You can instead maintain a low balance and keep the majority of your funds in a traditional bank account if you prefer.
Why Should You Trust Payset?
Advanced Fraud Protection Tools
Payset offers advanced fraud protection tools. In addition to implementing standard account passwords, two-factor authentication (2FA), and know your customer (KYC) verification, Payset also offers a fraud reporting mechanism.
Here’s how it works: if you report that your Payset account has been accessed by someone other than you, or if you report a fraudulent transaction, Payset will apply a security mechanism to your account to prevent further unauthorised access. We will also begin an investigation of the incident and inform you of any next steps you should take.
You can read more details about our fraud policy on this help page. You can also find out how you should respond to incidents of fraud on this page.
FCA Registered and GDPR Compliant
Payset is based in the U.K. We operate as an authorised electronic money institution (EMI).
We are also registered with the U.K.'s Financial Conduct Authority (FCA), meaning that we are compliant with financial regulations designed to protect users and their finances.
Payset also complies with GDPR regulations — a separate set of rules that are intended to ensure that sensitive customer data is managed in a way that protects user privacy.
Safeguarded User Funds
Payset safeguards user funds, meaning that we store user funds 100% separately from company funds. This safeguarding policy protects users in the event that Payset fails or becomes illiquid. If this occurs, users will generally have a claim to all of their funds.
By law, safeguarded funds must be stored with either an accredited financial institution or invested in low-risk assets through a custodian (or some combination of those).
Though safeguarding does not provide insurance, it provides a degree of financial protection that is standard throughout the financial industry.
We adhere to this safeguarding policy in compliance with regulations that apply to U.K. financial companies. You can read more about our safeguarding policy here.
Why Our Customers Choose Payset
Payset offers several benefits to users, including:
- Global coverage: Payset supports sending and receiving money in 180 countries
- Support for multiple currencies: Payset users can hold, send, and receive 34 different foreign currencies
- Instant payments: Payset offers instant on-platform transactions, meaning that users can make instant and free payments to other Payset users
- Real-time rates: Users can see a quoted cross-currency conversion rate before they finalize and send their transaction
- Support for multiple payment networks: Payset supports top financial networks including SWIFT, SEPA, Target2, Faster Payments (FPS), CHAPS, and more
- Security: Payset safeguards funds and offers advanced fraud protection
Get in Touch
To find out more about Payset, or to sign up for an account, click below.
Frequently asked questions
What is a multi-currency account/virtual IBAN?
A Payset multi-currency account allows you to receive money in 34 different currencies and send money in up to 38 currencies, all within the same account.
You can deposit and withdraw funds, convert currencies at competitive exchange rates, and hold your chosen currencies to capitalize on market movements.
A Payset multi-currency account allows startups and business owners to receive payments from clients virtually anywhere in the world and pay suppliers, staff, and contractors quickly and affordably in their chosen currency.
- Funds can be deposited and withdrawn from the account for a small fee.
- Account holders can send and receive money with other Payset users for free.
- Depending on your region, you can use various payment networks from your Payset account, including SWIFT, SEPA, ACH, Fedwire, Faster Payments, BACS, and CHAPS.
- Once you register an account, you will be provided with a Virtual IBAN (International Bank Account Number), which makes all of these transfers easy.
- We provide you with local payments and collections. For example, transactions in USD, EUR, CAD, and GBP are processed through the local payment networks, which is far cheaper and takes minutes as opposed to days
Are there limits on the amount of money I can send and receive?
No, there are no transaction limits on Payset multi-currency accounts.
However, higher-volume transactions may require additional anti-fraud verification. If you plan to make a large transaction, contact us in advance to avoid verification delays.
How is Payset regulated?
Payset is regulated as an authorized Electronic Money Institution by the UK Financial Conduct Authority. Our activities are also regulated by the Payment Services Regulation 2017 and the Electronic Money Regulation 2011 (SI 2011/99).
How do I add money to my account?
How do I send money from my account?
Once you have opened your verified IBAN account and added money to a balance, transferring funds is simple.
Simply log in into your account and add a beneficiary, then simply “make a transfer” in your preferred currency to that beneficiary.
Types of Multi-Currency Accounts
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