A guide to international money transfers

By Gwendoline Tan

If you’ve only got a minute:

• Different remittance service providers have different fee structures.
• Common fees associated with overseas transfers include the handling fee, cable charge, agent bank fees and correspondent bank fees.
• When choosing a service provider, consider the cost, speed, convenience and reliability of the transfer.
• With DBS Remit, you can make same day transfers to recipients of more than 50 countries across the world with zero additional fees.

In today’s globally connected world, sending money across international borders, also known as overseas remittance or overseas telegraphic transfers (OTT), has become more common than ever.

Whether supporting family abroad, investing in foreign-listed stocks and bonds, or simply managing global finances, finding a remittance solution that balances cost-effectiveness, convenience, reliability, and security is crucial. The last thing you want is to lose money due to high costs or transfer failures.

With so many remittance options available, understanding the fees and charges involved is key to ensuring your funds reach their destination without unexpected costs or delays.

Decoding the fees and charges

Banks, digital payment providers, and money transfer operators, all facilitate internation transfers, but each comes with its own fee structure. Regardless of which option you choose for your remittance, it is essential to understand the associated costs.

Handling fee

This is a common fee which covers the administrative costs of processing your transfer. This fee is typically higher if you conduct the transaction in person at a bank branch.

The handling fee can be a percentage of the total transfer amount or a fixed fee based on the transaction size.

For example, a 0.125% fee on a S$10,000 transfer means you will pay S$12.50. Some providers use a tiered system, charging a fixed fee based on ranges of transfer amounts. In this instance, it could look like S$5 for transfers up to S$5,000, S$10 for transfers between S$5000 and S$25,000, and S$25 for transfers over S$25,000 etc.

Cable charge

Another common fee is the cable charge which covers the time and effort for processing costs of communication between your service provider and the recipient’s bank. It is typically charged as a fixed fee.

Agent bank fees

These are charged by the receiving bank in the recipient’s country. They cover the work required to process the incoming transfer and ensure the funds are received.

Correspondent bank fees

Sometimes the sending and receiving banks do not have a direct relationship. When that happens, the transfer is processed through an intermediary bank within the SWIFT (Society for Worldwide Interbank Financial Telecommunications) network.

This bank is also referred to as the correspondent bank, and often charges its own fee which differs from bank to bank and can fluctuate over time.

Find out more about: International Money Transfers with DBS

Finding the right fit

There is no-one-size-fits-all solution when it comes to money transfers. The ideal choice depends on your individual needs and priorities. Here are 4 key factors that can guide your decision, namely cost, speed, convenience, and reliability.

1. Cost

When using any service, everyone wants to avoid paying more than necessary to make the most of their money.

Some transfer services may offer very attractive exchange rates, but charge higher fees, while others might boast free transfers but slightly less competitive exchange rates. Consider the overall costs, including the exchange rates, when making your transfer.

2. Speed

Different transfer services take varying amounts of time to complete your transfer, depending on the platform and receiving country. Some services offer instant transfers while others can take several days or even weeks.

A service that moves your funds quickly can take away the stress of waiting giving you peace of mind. The faster your transfer, the sooner your recipient gets the money they need, particularly in time-sensitive situations.

3. Convenience

In our fast-paced world, convenience is becoming increasingly valuable.

While many services now offer a smooth and simple process, some still require pre-loading funds into a separate account or e-wallet before sending money. If you make transfers regularly, this extra step can be a hassle, especially if there are limits on how much you can load into the account at once.

Opt for a service that lets you send money directly from your bank account with minimal steps for maximum convenience.

4. Reliability

Security and reliability are paramount when transferring funds, whether locally or overseas.

The Monetary Authority of Singapore (MAS) provides regulatory oversight on all remittance services and financial institutions in Singapore. Before choosing a transfer service, verify their licence on the MAS Financial Institutions Directory.

You want to feel confident knowing your funds are safe and secure throughout the transfer process. The last thing you want is for a large sum of money to be stuck in limbo, with little or no proper support to help resolve the issue. Robust customer support is essential in case any issues arise. A reliable service provider will offer accessible and responsive customer service channels.

DBS Remit

DBS Remit, for example, offers same-day transfers to over 50 countries with no additional fees, all completed in 3 simple steps on your digibank app. Just make sure to look out for the DBS Remit or Zero-Fee icons when making your transfer.

DBS Remit also allows you to keep track of your transfers and be notified when the funds reach your recipient, or if the transfer is unsuccessful. You can also increase the security of your transactions by enabling an extra layer of protection like 2-Factor Authentication and biometric authentication at any time.

Read more: Save more, wait less with DBS Remit
Find out more about: Fees and charges for overseas funds transfer

Tips for a smooth transfer experience

Whether you’re sending money regularly or making a one-time transfer, a few simple tips can help optimise the process.

Time your transfers

Timing your transfers strategically can save you money. Keep an eye on currency fluctuations and initiate your transfer when the exchange rates are favourable. If you don’t need the funds immediately, consider holding them in a short-term Foreign Currency Fixed Deposit.

DBS publishes its retail board rates online, providing transparency in exchange rates. You can use the currency converter on digibank online or mobile to find the updated rates. For transfer amounts exceeding S$50,000, you may be entitled to preferential exchange rates.

Remember to factor in public holidays in both Singapore and the receiving country as that can affect the speed of your transfer.

Read more: What can I do with my foreign currency?
Find out more about: Unlocking the world with DBS FX Services

Be prepared

Accurate recipient details are crucial. Have all necessary transfer details on hand and always double check them before making your transfer. These include the recipient’s bank name, account name, account number, and full address, as per their bank records. Any inaccuracies may lead to a delay, rejection, or even misdirection of your transfer.

For incoming overseas remittances, ensure you have the correct address and SWIFT code of your receiving bank as well.

Read more: digibanking, at your fingertips
Find out more about: Pre-transfer checklist

Prioritise security

Besides checking to make sure your transfer service is licensed by the MAS, it is also important to know the intended purpose of any incoming or outgoing transfers, as well as the identity of your recipient. Being clear about these details will help mitigate the risk of falling prey to scams.

Read more: 6 online banking safety tips

In conclusion

Understanding the various fees and charged involved with international transfers and considering key factors like cost, speed, convenience, and reliability, empowers you to make informed decisions about your international remittances.  

At the end of the day, the resulting peace of mind from knowing your funds are handled securely and efficiently makes the effort worthwhile.

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Disclaimers and Important Notice
This article is meant for information only and should not be relied upon as financial advice. Before making any decision to buy, sell or hold any investment or insurance product, you should seek advice from a financial adviser regarding its suitability.

Deposit Insurance Scheme
Singapore dollar deposits of non-bank depositors and monies and deposits denominated in Singapore dollars under the Supplementary Retirement Scheme are insured by the Singapore Deposit Insurance Corporation, for up to S$100,000 in aggregate per depositor per Scheme member by law. Monies and deposits denominated in Singapore dollars under the CPF Investment Scheme and CPF Retirement Sum Scheme are aggregated and separately insured up to S$100,000 for each depositor per Scheme member. Foreign currency deposits, dual currency investments, structured deposits and other investment products are not insured.