If you’ve always dreamed of getting married next to the ocean or saying your vows in an iconic location around the globe, the good news is that it’s never been easier to arrange a wedding overseas.
More and more couples are now opting for a wedding outside the US, but the one tricky area is payment. If you need to settle the bill in another currency, it’s not as simple as just sending a check in the mail. There’s lots of factors to take into account including charges, exchange rates and of course security too.
For many people, their usual bank might be the obvious place to send money overseas. However, although it’s a familiar name you know and trust, you might not get the best deal. A more economical option could be a money transfer service. If you’ve never had cause to send money to another country before, you might not have heard of these types of company. They don’t specialize in a wide range of financial services like a bank, instead they purely focus on trading foreign currency and sending international payments. This means that they are the industry experts when it comes to anything relating to exchange rates and foreign currency.
Here’s a run-through of what you need to consider when making payments overseas and why using a money transfer service could be your best option.
Transparency over fees
Sending money overseas is a service, and like any kind of service, there’s a fee for its provision. However, to get the best deal you first need to understand how much you’re being charged; surprisingly that’s not always as easy as it sounds.
Some providers may claim to offer this service for “free” but generally this just means that the fee has been built in invisibly elsewhere. Typically the charges will be added onto the exchange rate that you’re quoted so the more money you need to send, the more it will cost. Other providers such as banks may be more transparent, usually charging a percentage of the money being sent. While this is preferable as you can see the actual cost, once again it means that the more money you send, the more charges you will have to fork out.
If you’re paying for a wedding overseas, the chances are that you’ll be sending a substantial amount of cash so these kinds of charges can really add up. Therefore, it’s far preferable to pay a flat rate fee instead. A money transfer service usually operates on this basis, and the flat rate fee is often extremely low. This is due to the sheer volume of money transfer services performed by these specialist companies on a daily basis. The economies of scale can be passed on to their customers making it a far cheaper way to send money, and you won’t be paying steadily increasing charges if you need to send large amounts.
Getting the best exchange rate
When you budget for your wedding and check the price of overseas services, it can be difficult to factor in what could happen if the exchange rates move against you. If the dollar weakens and drops in value, it means you won’t get as much foreign currency. You’ll then have to hand over more of your US dollars to settle the same bill.
Some money transfer companies offer forward contracts; this is a way of locking in a good exchange rate for use in the future and provides protection against fluctuations in the market. When you’re planning a wedding, every cent counts and knowing exactly how much you’ll have to pay can provide real peace of mind.
Whether you choose to use a forward contract or not, you’ll want to make sure that you get the very best exchange rates available. To do this, you’ll need to look outside the bureau d’exchange in your local bank.
The Interbank rate is the exchange that the banks and big brokers have access to, and represents the very best available. Unfortunately, as a retail customer, you won’t be able to exchange your dollars at the same rate. Banks add on charges and set their own rates, which can be as much as 5% more than the Interbank rate leaving them with a fat profit and you seriously out of pocket. Ouch.
Money transfer services typically offer a far more competitive exchange rate, giving you lots more bang for your buck than you’d get from your bank. This is because money transfer companies specialize in sending money overseas which gives them more power to secure the best rates possible which are passed on to the customer.
Be sure about staying secure
Weddings cost plenty of money wherever they take place, and sending money overseas can be a very real risk, leaving you exposed to the possibility of fraud. No matter how good the exchange rate is, being sure that you’re using a legitimate provider is the main priority.
Luckily there’s an easy way to do this because in the US, every money transfer service provider is required to hold a license. Referred to in law as a “Money Service Business” (MSB), every company must register and permit to their operation being regulated, monitored and overseen by the Financial Crimes Enforcement Network (FinCEN), one of the departments in the US Treasury.
To get reassurance that the money transfer service you are using is legitimate, secure and safe, all you need do is check whether the company holds a license. You can do this on the FinCEN website for free. If the company isn’t registered with FinCEN you shouldn’t even begin to consider using their services as they are almost certainly operating illegally.
Using a licensed money transfer service is much safer than paying cash on arrival as you’ll have proof of what you paid and who to. In the unfortunate event of a problem arising, this can provide you with some much needed protection.
Get more for your money
Getting married overseas can be a fantasy come true but if you don’t manage to organize the payments properly it can turn into a nightmare. Using a money transfer service to pay for your costs can make the whole process much easier, leaving you free to relax and enjoy the big day!