For students flying abroad for higher studies, fund transfers from home country is one of the major concerns, especially in country like India. The primary worry for students are fund transfer for tuition fees, funds for daily expenses; beyond these there is also one big concern about what is the best method for fund transfer & whom to trust as there are so many forex dealers in India. According to a recent study the most preferable methods for money transfer abroad are wire transfer & forex card.
Wire Transfer & Forex Card:
A wire transfer is an electronic funds transfer made from one individual or entity to another. In wire transfer through your bank online, in your local branch or through a forex dealer nearby. Once you have placed the order for wire transfer the bank or dealer will forward a message to its branch in the receiver’s country. Once that’s completed, the receiver will have the funds within a few hours.
On the other hand a forex card is pre-loaded with money & enables you to use this money in required local currency. It’s like any other credit or debit card but it is specifically for foreign currency. To buy foreign currency in form of forex card once has to purchase it before leaving the home country.
Wire Transfer Vs. Forex Card
Here are some advantages & disadvantages of both payment modes.
- Commission: Both the sender and receiver pay commission for a wire transfer. The sender pays the fee upfront, and the receiver’s fee is taken out from the amount transferred. The commission always depends upon the dealer or bank usually the commission is very high. On the other hand for purchasing forex card the commission is very low or negligible & usually the good forex dealer don’t charge any activation or issuing charges for forex card.
- Currency & Security: Wire transfer is can only be initiated once you are in foreign country & you have to take care of the cash, whereas, card mitigates the risk of losing cash in case of theft or loss of wallet the bank will re issue a new card.
- University Fees: Most universities accept only wire transfers. In case your university doesn’t accept Forex card, you need to do a wire transfer, so check ahead.
- Withdrawal Limits: Usually there is always a restriction on amount to be spend using prepaid card within a period of 24 hours. Be aware of your transaction limits.
- ATM Withdrawal Charges: Usually the initial 2-3 withdrawals are free from ATMs after that a small amount is deducted each time you withdraw money from ATMs using forex cards.