International Money Transfer

Updated 16 June 2019
Summary of 

Sending money to family overseas, paying an employee or wiring urgent money to a loved one does not need to cost a fortune in fees. Many banks charge a NZ$20 fee per transfer, but a number of online operators do it for a fraction of that. Our guide to international money transfers tells you everything you need to know to get the best foreign exchange rate and pay the lowest fee.
 
This step-by-step guide explains how to send money overseas for as little as possible. Whatever your needs - one-off or a regular payment – we reveal how to save significant amounts of money.
 
This guide covers:
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​What will it cost to transfer money overseas?

Banks and money transfer companies charge you in two ways:
  1. The transfer fee, and
  2. The exchange rate
You may see adverts for ‘fee-free transfers’ or similar – the exchange rate will often be bad to make up for not charging a transfer fee. Don’t be caught out by such advertising.
 
The Transfer Fee
  • This can come in many forms, it will either be per transaction (i.e. such as banks who charge $20), a commission (such as some kiosks who charge 2% or 3% of the transfer amount), or a mixture of both.
  • These fees are often disguised or mentioned in the fine print to hide the true cost of the transfer service.
 
Exchange rate
  • The foreign exchange rate is the amount of foreign currency you receive for your New Zealand Dollars.
  • For example, if you see “0:52 GBP” or “0.92 AUD”, this means you will get £52 or A$92 per NZ$100 exchanged, less any fees charged.
  • Many companies advertise that they are 'commission-free' or ‘fee-free’ and then lower the exchange rate against your favour so you get less foreign exchange currency for your NZD.
  • Confusingly, you won’t know the exchange rates of all the companies at any one time, as few publish them online, and the rates go up and down throughout the day. 
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​How safe is a money transfer?

  • Sending NZD overseas is only a risk if the company you use goes bankrupt during the process. If you use a New Zealand bank, the risk is minimal.
  • Online companies such as TransferWise are also relatively safe. But the financial position of a dodgy-looking kiosk is less certain, so it’s essential to consider the amount of the money being transferred and whether or not you can afford to lose it.
  • Thankfully, in New Zealand, the instances of currency companies going bust are relatively rare – but it can happen, and when it does there is no compensation or legal protection in place for those who lose out. 
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How can I send money to another country?

There are generally four ways to send money to someone in another country:
  1. Use an international money transfer company – these are online brokers, such as TransferWise. You join online and can send money in about 5-10 minutes, once ID approvals are completed. Generally, such companies support payment to almost any country in the world.
  2. Use your bank – all banks offer this service, but in most cases you will need to be their customer. For example, if Westpac has a great exchange rate for the Australian Dollar but you bank with the BNZ, you won’t be able to use their service. Banks are often limited in what currencies they can support payments for, and you may need to have the payment ‘approved’ by head office before your money leaves New Zealand.
  3. Use a money transfer kiosk – these are physical stores, often providing foreign exchange in cash to tourists etc. An example of such a kiosk is Western Union. These companies tend to support payments to almost any country in the world, but there may be limitations.
  4. Use PayPal – if you have a PayPal account, you can send money to anyone else with a PayPal account. Generally, the foreign exchange rates offered by PayPal are not very competitive compared to the alternatives, but this can suit your needs in some circumstances. Read our guide to PayPal fees (LINK) for more details. 
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What is the best way to compare options?

With fees, commissions and a variation in exchange rates, it does seem complicated. But it doesn’t need to be – there is only ONE question you need to ask:
  • After all charges, how many Euros/Australian Dollars/Rupees/Pounds/Yen will I get?
 
While this may seem like an easy question, it’s sometimes hard to get an answer. While fees and commission percentages are relatively stable, exchange rates go up and down every minute.  Our suggested process:
  1. Use our Currency Converter to get a mid-market exchange rate (this is the mid-point between the wholesale 'buy' and 'sell' price). Enter the amount of NZD you want to send and the currency you want to deliver it in, to get an idea of the total NZD cost.
  2. Compare this to the quotes by banks and/or foreign exchange companies. This will give you an indication of which quote is the best.
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Compare international money transfers

  • Transfer money worldwide FOR LESS by using a service that charges lower fees.
  • Compare these companies to find the best deal whether you want to send money today or on a regular basis.

TransferWise

  • Stand out points: Low fees, fast processing and transfer times, excellent user experience
  • Coverage from New Zealand: 75+ countries
  • Payment options: Bank transfer, POLi, debit card and credit card
  • Cost: One of the cheapest money transfer services available in New Zealand, and arguably the most trusted. For NZ$1,000 being sent to India, the UK, Europe or Australia, TransferWise's fees ranges from $7 to $9 if paying via bank transfer, with market-leading exchange rates. Additional fees apply for non-bank transfer payment options. 
  • Speed: For most countries, same-day delivery is possible but only if you use POLi or debit/credit cards as a method of payment. Otherwise, if paying by bank transfer, it can take around one to three business days, depending on the destination.
  • Transfer limits: Up to $2,200,000 per transfer. 
  • Customer experience: Phone support (limited, and out of sync with the New Zealand timezone), email, mobile app and Facebook messenger.
  • Want to know more? Read our TransferWise review or visit TransferWise and sign up.
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International Money Transfers - Frequently Asked Questions

How can I send money to another country?

  • The international money transfer limit will depend on where you’re sending the money from and to, and the provider’s security limits.
  • Depending on how much you plan to send, there may be limits. Generally, payments totalling less than $10,000 are no issue for banks, specialist money transfer companies or kiosks.
  • If you’re buying a car from overseas or selling your home and sending the money overseas, you may find your preferred provider isn’t able to offer a service. 
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What do I do about tax?

  • If you are moving money overseas and unsure of the tax obligations, it’s a good idea to seek the advice of an accountant who is experienced in such matters.
  • Different countries have different rules on how much tax you should pay on any money received, and this will depend on the nature of the money – for example, whether the money is a financial gift or a regular salary.
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What details do I need to send an international money transfer?

To send money overseas, you will need to provide the international money transfer company with:
  • Name (the account holder’s name)
  • IBAN
  • SWIFT/BIC code
  • The address of the recipient, and in some cases, their email and phone number
  • ABA number (USA) or ​IFSC code (India)
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How do I pay for an international money transfer?

You can send money overseas using physical cash, money in your bank account, credit or debit cards and a PayPal balance. The fees will differ depending on the method, and some companies will only accept certain forms of payment.

How long does it take for an international money transfer to arrive?

  • It depends on what country you send the money to, how you pay for the transfer, and the provider you use.
  • If you’re using a bank, it can take between two and five working days, where as TransferWise can send money from New Zealand to England, India or the Philippines in a matter of seconds.
  • PayPal offers an instant service, meaning the recipient will receive their money as soon as you press ‘send’. 
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How can I track an international money transfer?

  • Specialist companies such as TransferWise send an email to both the sender and the recipient of the transfer with tracking information and an estimated time of arrival. This is also a service that will also be offered by companies such as Western Union.
  • Banks however don’t tend to offer this service, as they often use older technology compared to specialist companies such as TransferWise. 
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​Money Transfer Options for One-Off Payments (NZ$10,000 or less)

Online and Bank services for one-off small payments
A number of banks and specialist companies allow you to send money online, using e-commerce transfers. The cheapest, safest and fastest option depends on how much money you want to send.
Popular uses include:
  • Sending a one-off sum of money to a friend/family member overseas, e.g. for Birthday or Christmas presents
  • Paying for goods ordered on Alibaba or directly with an overseas supplier
  • Paying overseas employees or contractors
 
There are a number of New Zealand firms and banks offering international money transfers. The process is simple - you pay them in NZD and they initiate an internet-based money transfer. We have listed these below, taking into account their fees, services and any commissions they charge.
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Money Transfer Options for LARGE One-Off Payments (NZ$10,000 or more)

While your options and ability to negotiate rates and fees are limited with small, one-off transfers, larger money transfers have more bargaining power. In most cases, a large payment is for situations as such:
  • Buying or selling overseas property
  • Making regular payments overseas, such as a mortgage, bills, a pension or an allowance
  • If you’re moving overseas and want to transfer cash for when you arrive
 
As is the case with smaller, one-off payments, you have no protection if the company you use to transfer your money goes bankrupt.

X tips for transferring large amounts

Small differentials can make a HUGE difference – a 1% better exchange rate on a $50,000 transfer makes a $500 difference. The best exchange rate AND the lowest fee/commission makes all the difference.
  1. Benchmark the rate - use our Currency Converter (LINK) to get a mid-market exchange rate (this is the mid-point between the wholesale 'buy' and 'sell' price). Enter the amount of NZD you want to send and the currency you want to deliver it in, to get an idea of the total NZD cost.
  2. Compare this to the quotes by banks and/or foreign exchange companies. This will give you an indication of which quote is the best. It's rare that a bank will actually offer the best deal, but knowing what they will charge is useful, and if the bank is willing to negotiate, it could be the winner.
  3. Get quotes around the same time – as rates change every minute, you can only compare effectively if you get your quotes on the same morning or afternoon.
  4. Typically, the less you transfer, the worse the exchange rates you will get – if you’re using a provider operating offline, such as a bank or specialist broker, calling to negotiate exactly what you need to transfer can lead to a better rate.
  5. If you’re flexible with time, you can lock in a rate later. 
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