4. Cost Of Service

While choosing a mode of transfer, most importantly consider its cost of service. This will help you to reduce some damage to your wallet. According to an RBI survey, SWIFT (an international wire transfer system) is costlier vis-a-vis drafts and cheques. For instance, the cost of remitting up to $500 from the US to India through SWIFT is between 1-5 percent of the funds transferred, while remittances made through for demand drafts/cheques charges only 2 percent of the remitted amount.

Money transfer services like Western Union charge a higher commission, i.e nearly 25-30 percent more than banks. This is because they offer more specialized services—neither the sender nor receiver needs to own a bank account and also it offers speedy and better services.

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5. Convenience

Before selecting the mode of transfer, don’t only consider the speed and cost, but also convenience of transfer for both you and the recipient. If in case one of the parties is not comfortable using the Internet option, then opting for an offline route would be better.

 Another important factor which you must consider is the amount to be transferred. While there is no ceiling on demand drafts (cash purchases are not permitted for over 50,000), a cap of 5 lakh has been imposed by some banks on NEFT transactions, and $2,500 (1.35 lakh) is the maximum limit under the MTSS scheme. Also be sure to ask the service provider about its refund policy and your rights in case the money is not received within the specified period.

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