Why Compare Money Transfer Services?

The Australian Competition and Consumer Commission (ACCC) strongly advises Aussies to “shop around” when sending money internationally. Hidden fees and poor exchange rates can cost you hundreds of dollars on larger transfers.

Traditional banks often charge hefty fees and offer exchange rates that are 3-4% worse than the mid-market rate. Specialist money transfer services have shaken up this market, offering better rates and lower fees.

Key Factors to Consider When Choosing a Money Transfer Service

1. Total Cost (Fees + Exchange Rate Margin)

Don’t just look at the transfer fee. The exchange rate is where many providers make their profit. A service advertising “zero fees” might still be more expensive due to a poor exchange rate.

2. Transfer Speed

Delivery times vary dramatically. Bank transfers can take 1-5 business days, whilst cash pickup services often arrive within minutes.

3. Security and Regulation

Ensure your chosen provider is regulated by ASIC or other reputable financial authorities. Look for encryption, fraud monitoring, and customer protection guarantees.

4. Payment and Receiving Options

Consider how you want to pay (bank transfer, card, PayID) and how your recipient wants to receive the money (bank account, cash pickup, mobile wallet).

Comprehensive Comparison of Top Money Transfer Services in Australia

Detailed Provider Analysis

Wise (Formerly TransferWise)

Wise has revolutionised international money transfers by using the real mid-market exchange rate. They’re transparent about their fees, which typically range from 0.42% to 2% depending on the currency pair and payment method.

Best for: Cost-conscious users who want transparency and competitive rates.

Example: Sending $1,000 AUD to USD costs approximately $4.68 in fees, and you’ll get the real exchange rate you see on Google.

Western Union

The global giant offers unmatched reach with cash pickup locations in over 200 countries. Their fees vary significantly based on the destination and delivery method.

Best for: Recipients who need cash pickup or live in remote areas without banking access.

Example: Sending money to rural Philippines for cash pickup can arrive within minutes, perfect for emergency situations.

PayPal and Xoom

PayPal’s ecosystem makes it convenient for existing users, whilst Xoom (owned by PayPal) specialises in international transfers with various delivery options.

Best for: Existing PayPal users who value convenience and buyer protection.

Example: PayPal-to-PayPal transfers between family members can be instant and secure.

XE Money Transfer

Known for their currency tools and exchange rate information, XE’s money transfer service offers competitive rates with a user-friendly experience.

Best for: Users who regularly track exchange rates and want competitive pricing.

Example: Their rate alerts help you send money when exchange rates are favourable.

Remitly

Focuses on specific corridors with competitive pricing, particularly for transfers to developing countries. They offer guaranteed delivery times.

Best for: Regular senders to specific countries, especially in Asia and Latin America.

Example: Transfers to India often arrive within hours with competitive rates.

OFX

Caters more to business users and high-value transfers. They offer personalised service with dedicated account managers for larger clients.

Best for: Business transfers and high-value personal transfers over $10,000.

Example: Property purchases overseas benefit from their personalised service and competitive rates for large amounts.

Real-World Transfer Examples

Scenario 1: Supporting Family in the Philippines

Amount: $500 AUD monthly

Best options: Remitly or Western Union for cash pickup, Wise for bank transfers

Why: Fast delivery times and extensive cash pickup networks in the Philippines

Scenario 2: Paying University Fees in the UK

Amount: $25,000 AUD annually

Best options: Wise or OFX

Why: Large transfers benefit from low percentage fees and competitive exchange rates

Scenario 3: Emergency Transfer to Bali

Amount: $200 AUD urgently

Best options: Western Union or MoneyGram for cash pickup

Why: Immediate cash pickup availability for emergency situations

How Exchange Rates Really Work

Understanding exchange rates is crucial for getting the best deal. The “mid-market rate” is the real exchange rate you see on financial websites like XE.com or Google. It’s the rate banks use when trading with each other.

Most providers add a margin to this rate. For example:

• Mid-market rate: 1 AUD = 0.67 USD
• Provider’s rate: 1 AUD = 0.65 USD
• Margin: 2.99% (this is where they make profit)

Wise is unique because they use the real mid-market rate and charge a separate, transparent fee instead.

Transfer Speed Comparison

Instant Transfers (Seconds to Minutes)

• PayPal to PayPal transfers
• Western Union cash pickup
• MoneyGram cash pickup
• Some Wise transfers (depending on route)

Same Day Transfers

• Most specialist provider bank transfers
• Remitly express service
• XE fast transfers

1-3 Business Days

• Standard bank transfers via specialists
• Traditional bank wire transfers
• OFX transfers

Security and Regulation in Australia

When sending money internationally, security should be your top priority. Here’s what to look for:

Regulatory Compliance

• ASIC registration: All money transfer services operating in Australia must be registered with ASIC
• AUSTRAC compliance: Providers must follow anti-money laundering and counter-terrorism financing laws
• International regulation: Look for providers regulated in multiple jurisdictions (FCA in UK, FinCEN in US)

Security Features

• 256-bit SSL encryption for all transactions
• Two-factor authentication for account access
• 24/7 fraud monitoring systems
• Customer funds protection schemes

Hidden Costs to Watch Out For

The ACCC warns consumers about hidden costs in money transfers. Here’s what to check:

Common Hidden Fees

• Intermediary bank fees: Third-party banks may deduct fees during transfer
• Receiving bank charges: The recipient’s bank might charge to receive international transfers
• Payment method fees: Credit cards often incur additional charges (2-3%)
• Currency conversion by your bank: If paying by card, your bank might apply its own conversion rate

How to Calculate True Cost

1. Check the exchange rate offered vs. the mid-market rate
2. Add all upfront fees (transfer fee, payment method fee)
3. Consider potential receiving fees
4. Calculate how much your recipient will actually receive

Tips for Getting the Best Deal

Timing Your Transfer

• Monitor exchange rates using apps like XE or Wise
• Set up rate alerts to notify you when rates improve
• Avoid transfers during major economic announcements
• Consider the timing in your recipient’s country (banking hours)

Choosing the Right Payment Method

• Bank transfer: Usually cheapest option
• PayID/Osko: Fast and secure for Australian banks
• Debit card: Quick but may have small fees
• Credit card: Avoid if possible due to cash advance fees

Optimising for Larger Transfers

• Many providers offer better rates for transfers over $10,000
• Consider splitting very large amounts if beneficial
• Business accounts often have better rates than personal accounts
• Some providers offer forward contracts to lock in rates

When to Use Traditional Banks vs. Specialist Providers

Use Traditional Banks When:

• You have a premium banking relationship with fee waivers
• Your transfer requires specific documentation or compliance
• You prefer face-to-face service for very large amounts
• You’re transferring to a country with limited specialist provider coverage

Use Specialist Providers When:

• You want the best exchange rates and lowest fees
• Speed is important
• You make regular international transfers
• You want transparent pricing and real-time tracking

Frequently Asked Questions

What’s the cheapest way to send money overseas from Australia?

For most transfers, Wise offers the best combination of low fees and excellent exchange rates. However, the cheapest option depends on your specific transfer amount, destination, and delivery method.

How long do international money transfers take?

Transfer times vary from minutes (cash pickup) to 5 business days (traditional bank wires). Most specialist providers complete bank transfers within 1-2 business days.

Are online money transfer services safe?

Yes, when you choose reputable providers regulated by ASIC and other financial authorities. Look for encryption, fraud monitoring, and positive customer reviews.

What information do I need to send money internationally?

You’ll typically need your recipient’s full name, address, bank details (account number, SWIFT/BIC code), and purpose of transfer. Some countries require additional documentation.

Can I cancel an international money transfer?

Cancellation policies vary by provider and transfer status. Most allow cancellations before the money is picked up or deposited, but fees may apply.

Making Your Decision

Choosing the right money transfer service depends on your priorities:

• Best overall value: Wise for transparency and competitive rates
• Fastest delivery: Western Union or MoneyGram for cash pickup
• Largest global reach: Western Union with 200+ countries
• High-value transfers: OFX for personalised service
• Existing PayPal users: PayPal/Xoom for convenience
• Regular transfers to specific countries: Remitly for competitive corridor pricing

Remember, the ACCC’s advice to “shop around” is spot on. Compare the total cost for your specific transfer, including fees and exchange rate . Don’t just focus on headline rates or fees – calculate exactly how much your recipient will receive.

Getting Started

Ready to send money overseas? Here’s how to begin:

1. Compare rates for your specific transfer using each provider’s website or calculator
2. Read customer reviews and check regulatory status
3. Create an account with your chosen provider
4. Verify your identity (usually requires passport or driver’s licence)
5. Enter transfer details and double-check recipient information
6. Choose your payment method and complete the transfer
7. Track your transfer and notify your recipient

With the right provider, sending money internationally from Australia can be quick, secure, and cost-effective. Take the time to compare your options – your wallet will thank you.