How to Send an International Money Transfer from Canada to USA
When you’re seeking to understand the different service offerings provided by foreign exchange institutions, it’s important to get a firm grasp of the essentials. At the end of the day, any forms of payment that extend across national borders undergo a mandatory conversion process. In North America, you can occasionally get away with making payments in either CAD or USD at some businesses near the border, but who knows what sort of exchange rate you’ll get on the spot. You’ve likely come across the term “international money transfer” at least once while researching currency conversion.
At the most basic definition, an international money transfer involves a digital transmission of money that gets simultaneously converted into another nation’s monetary denomination. To save the most money on international money transfers, you should find an independent expert currency exchange firm that can give you the best rates.
EVERYTHING YOU NEED TO KNOW ABOUT TRANSFERRING DOLLARS ACROSS THE BORDER
We’ll shed some light on a few things to hopefully give you more clarity on the subject. By understanding international money transfers you can better navigate the FX market with some expert knowledge.
Given how frequently Canada does business with the United States, understanding how these payments work will lead to huge dollar savings for you in the long run.
What is an International Money Transfer (IMT)?
International money transfers are typically performed between two parties: a payer, who covers the order, and a beneficiary, who receives the order. International money transfers are often performed between Canada and the US to make overseas payments, fund foreign real estate investments, pay for cross-border business expenses, or simply just to send money to family members.
In terms of the potential delivery channels, international money transfers are sent out in the form of wire transfers, digital transactions, debit/credit payments, or bank drafts.
What is an IMT Float?
An IMT float is essentially the turnaround time of your transaction. The “float period” begins when you’ve initialized the transfer of funds, and ends when your recipient gets access to the money.
Depending on the method of money transfer, your float can range between 24 hours to a few days; sometimes it could even take a few weeks. It consists of establishing the transaction amount, paying for it with a reliable method, and waiting for any intermediary processing while the money is in-transit.
When considering float periods, it’s important to find a reputable money transfer service that promises timely delivery of funds.
What does IMT Advice represent?
To clarify right off the bat, IMT advice is not synonymous with the traditional meaning of “advice.” Speaking plainly, IMT advice is a formality for businesses that need a transaction confirmation written on paper. Most foreign exchange firms, such as KnightsbridgeFX, will refer to IMT advice just as written confirmation to avoid confusion.
The “advice” generated on an international money transfer is basically an official notification given out to the parties involved stating that a payment has been initialized. Although it may assist you in the event of a personal audit, written confirmation is generally more important for businesses that operate with tight financial records.
What is an IMT Address?
The address involved in an international money transfer is simply where the funds will end up once transit is finalized. Usually, the IMT address is the deposit/banking details of your recipient.
On a broader scale, the term “address” inquires about your recipient’s geographical location as well. This is also an important consideration because different countries have varying foreign exchange costs.
What to consider before you transfer money to the US
- TRANSFER METHOD – usually the system that transfers the funds plays a role in how much it will cost and how soon it will arrive at the recipient
- TRANSFER FEES - Always check a foreign exchange company’s fee structure before going forward with a transfer
- EXCHANGE RATE – Possibly the most important consideration during conversions, you want to aim for the lowest rate possible
- LIMITS – Some companies will cap your order size, or on the other hand they can set a strict minimum
- SPEED – Not all companies and transfer methods will deliver your funds to the recipient in the same time frame
HOW TO SEND MONEY FROM CANADA TO THE US ONLINE
Professional foreign exchange companies who specialize in currency conversions and international money transfers will place these money transfers for you at a small cost. Costs usually come embedded in the exchange rate or flat fees per order.
Historically, sending money abroad involved high transaction fees and unfavourable exchange rate mark-ups to convert the outbound funds into local native currency. With the modern day efficiency of digital enterprises, you can find very affordable rates just by searching around online.
4 Ways to Send an International Money Transfer Across the Border
Before you place money transfer orders internationally, it’s a good idea to understand your options first. There’s no one-size-fits-all transfer method; the best transaction pathway depends on your individual needs.
Here are a few variables you should consider prior to booking an IMT: your location/recipient location, transaction costs, speed of the transfer, security of funds, and overall quality of the service.
Before the invention of digital currency wallets and online-only direct deposits, the most common method of carrying out an IMT was by wire transfer. Although some consider this practice outdated by technological advancements in sending money, the truth is a wire transfer is still very reliable and secure.
Typically, international wire transfers are placed either in person at your local bank or through an online banking portal. The process involves bouncing your funds through an intermediary bank network (called the SWIFT network) until it ends up in your recipient’s account.
While traditional wire transfers with major banks can be very costly, KnightsbridgeFX offers free wire transfers on eligible orders.
Placing an international money transfer with cash or a cheque is truly old-fashioned and not recommended in most circumstances. Conducting money transfers through written cheques will often result in substantial float periods.
Cheques themselves, as a financial product, are slowly rotating out of daily use anyways for good reason. In a world where timely access of delivered funds is vital, mailing a cheque through the postal service is just too slow.
Credit and Debit Balances
Oftentimes you can make the payment for an IMT with your debit or credit card information. While it can prove to be extremely convenient, especially if you’re on the go and need to book a quick transaction, it’s usually subject to higher fees.
In many instances, convenience and cost in the foreign exchange industry go hand in hand, and this example shows it perfectly. If you’re willing to book a transaction using an FX service’s in-house account balance you could save a ton of money.
This method is steadily becoming the most popular way to perform foreign exchange transactions in the modern day, primarily due to its ease of use and speedy delivery.
One commonly known example of digital wallet payments is PayPal. Millions of users today use PayPal for currency conversion and international money transfer because of the application’s simplicity.
However, it’s worth noting that this simplicity comes at a cost – PayPal is not the best FX service provider in terms of dollar cost savings. With PayPal, you’ll be paying higher fees for their convenience and sleek user interface; a quick transfer is not the same as a cheap transfer.
FINAL THOUGHTS: LEARNING ABOUT INTERNATIONAL MONEY TRANSFERS
Whether you need to book an IMT on behalf of a business or for personal reasons, you’ll find better deals at third party foreign exchange specialists than simply booking one at a local bank.
The big banking system has traditionally profited off unfavorable FX margins (good for them while bad for the consumer) and many frequent FX users seek cheaper alternatives.
KnightsbridgeFX offers a great balance between conveniences, reliability, speed, and overall cost efficiency – as long as you’re transacting over $2000 you won’t be subject to any hidden fees or fixed transfer charges.
How We Can Help
KnightsbridgeFX offers completely free wire transfers with ZERO transaction fees and hidden charges on all cross-border international money transfers over $2000. With KFX, you’re guaranteed a competitive exchange rate that you can lock in.
Call our phone line at: 1-877-355-5239 to speak to a representative and receive a complimentary no- obligation quote.
Sending Funds from Canada to USA Digitally
Follow our super easy four step process to send money electronically today:
SIGN UP – Have your personal ID ready so we can verify your identity, and select the method of payment you’d like to use.
GIVE US THE DETAILS – Tell us exactly how you’d like us to place your order. Typically most of our retail clients want us to send direct deposits to a recipient’s bank account.
DOUBLE CHECK YOUR ORDER – Once you’ve gone through the terms of the transfer, you can give us a confirmation.
YOU’RE ALL SET – All you have to do now is wait until the funds are delivered! Please keep holds on any written confirmations or records pertaining to your account.
Looking to place an international money transfer specifically towards Canada? Check out our article on the best way to send money to Canada to learn more.