International Money Transfers: Options For Students In The Usa

As an international student in the US, you may need to receive money from your home country to cover expenses such as tuition fees and accommodation charges. There are several ways to do this, including traditional bank transfers, e-wallets, and online money transfer services. Bank transfers are known for being safe, secure, and fast, but they can be expensive due to hidden fees and complex processes. To avoid these fees, you may want to consider a money transfer specialist or non-bank payment service provider (PSP) such as Wise (formerly TransferWise), OFX, CurrencyFair, or TorFX, which offer lower rates and faster transfers. When selecting a bank, be sure to ask about banking fees, minimum balances, overdraft charges, and international activities. Additionally, you may want to consider getting a credit card or debit card to help you build credit history and conveniently pay for purchases.

Wire transfer fees

However, there are ways to reduce or avoid these fees. Some banks offer promotions or discounts for certain conditions, such as a wire transfer limit. For example, Chase offers free international wire transfers for online transfers of $5000 or more in a foreign currency. Citibank and Wells Fargo waive their outgoing transfer fees for online wires in a foreign currency. Using online banking or a bank's mobile app can also reduce fees, as these transfers are cheaper for banks to process.

Another option is to use a money transfer specialist or non-bank payment service provider (PSP). These platforms often have lower rates than traditional banks and allow you to transfer, receive, and spend in different currencies with lower or zero fees. Examples of these services include Wise (formerly TransferWise), OFX, CurrencyFair, and TorFX, which offers free transfers with excellent exchange rates.

It's important to note that exchange rates can fluctuate, so it's worth tracking the rates and researching different providers' exchange rates to find one close to the standard mid-market rate. Additionally, making one large payment instead of multiple small ones can also reduce fees.

Lastly, be cautious of scams when making wire transfers. Always confirm the fee with each company involved and factor that into the amount you send.

Alternative options to traditional banks

There are several alternative options to traditional banks for sending and receiving money while studying in the US. These include money transfer specialists and non-bank payment service providers (PSPs). Third-party platforms such as these allow you to store, transfer, and receive money in different currencies, often with zero or much lower fees than traditional banks.

Examples of money transfer specialists and PSPs include:

• Wise (formerly TransferWise)
• OFX
• CurrencyFair
• Xe
• MoneyGram
• Zelle
• TorFX

These services are not designed for storing or saving money long-term, but rather to be used alongside a traditional bank account.

When choosing a money transfer service, it is important to consider the amount and frequency of your transactions. If you are planning on making regular transfers, you will want to look for a service that offers the best deal over several transactions. On the other hand, if you are making a one-off or particularly large transaction, you may wish to look for any current deals that can accommodate your needs.

It is also worth noting that some universities invite bank representatives to campus to help students open bank accounts and answer questions about banking.

Opening a bank account

As an international student in the US, you can receive money from abroad by providing your sender with your US bank account details. To open a bank account as an international student in the US, you will typically need to follow the steps outlined below.

Choosing a Bank

The first step is to choose a bank that suits your needs. Some factors to consider when choosing a bank include:

• Location: Choose a bank with branches and ATMs conveniently located near your school or place of residence. This will make it easier for you to access your account and conduct transactions in person if needed.
• Account Fees: Some banks may charge monthly maintenance fees or other service charges. Look for banks that offer student accounts with minimal or no fees.
• International Features: If you plan on receiving international money transfers regularly, look for banks that offer competitive exchange rates and have lower transaction fees for incoming international transfers. Some banks may also have partnerships with money transfer services, which can make the process smoother.
• Online Banking: Opt for a bank that offers robust online and mobile banking services. This will allow you to manage your account, transfer funds, and pay bills conveniently from anywhere.

Documents Required

Once you've selected a bank, gather the necessary documents to open a bank account. The specific requirements may vary slightly between banks, but generally, you will need:

• Proof of Identification: This can include your passport, visa, driver's license, state ID, or other government-issued ID. Ensure that your documents are valid and up to date.
• Proof of Student Status: Some banks may require documentation that confirms your student status. This could be your acceptance letter from your university or college, a student ID card, or other proof of enrolment.
• US Address: You will need to provide a physical US address, such as your residence or school dormitory. Some banks may also accept a PO box.
• Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN): While it is not mandatory to have an SSN or ITIN to open a bank account as an international student, it can make the process smoother. Some banks may allow you to open an account without an SSN/ITIN but might request that you provide one later.

Opening the Account

After choosing a bank and gathering the required documents, follow these steps to open your account:

• Visit your chosen bank branch in person. It is recommended to set up an appointment in advance to avoid waiting times.
• Bring the original copies of your documents and at least one photocopy set. Bank staff will need to verify and make copies of your documents.
• Fill out the account opening form accurately and completely. Provide all the requested information, including your personal details, contact information, and any beneficiary or emergency contact details.
• Choose the type of account you wish to open. You can open a checking account, savings account, or both, depending on your needs. Some banks may offer special student packages with multiple accounts.
• Understand the terms and conditions of the account, including any fees, interest rates, and features associated with the account. Ask questions if anything is unclear.
• Provide your initial deposit. Some accounts may require a minimum opening deposit, so be prepared to fund your account accordingly.

Post-Account Opening

Once your account is opened, there are a few additional steps you may need to take:

• Obtain Account Details: After your account is set up, obtain your account number, routing number, and any other relevant details. This information will be necessary for receiving international money transfers.
• Set Up Online Banking: Enroll in your bank's online banking platform to access and manage your account remotely. This will typically involve creating a secure username and password.
• Link Other Accounts: If you have other accounts, such as a credit card or loan, you may want to link them to your new account for easier fund transfers and bill payments.
• Monitor Your Account: Regularly review your account activity to ensure there is no fraudulent activity and to keep track of your finances. Most banks offer mobile apps that allow you to monitor your account in real time.
• Update Sender Information: Provide your sender (the person sending you money from abroad) with your new US bank account details, including the account number, routing number, and SWIFT code (if applicable).

Remember that the specific requirements and processes may vary slightly between different banks in the US. Always check with your chosen bank for their most up-to-date requirements and procedures for opening a bank account as an international student.

Credit and debit cards

As an international student in the US, you can use a credit or debit card to send money abroad to your loved ones. Services like Western Union allow you to transfer money to your recipient's bank account or send it for cash pickup at an agent location. You can pay using a credit or debit card, and the funds will be ready for pickup within minutes. You will receive a confirmation email with a Money Transfer Control Number (MTCN) to help you and your recipient track the payment.

However, it is important to be cautious of potential scams when transferring money. For example, be wary of emails containing grammatical and spelling errors, strangers asking you to wire money, or fake checks sent to gain your trust and personal information.

To receive money from abroad while studying in the US, you can open a US bank account. This will allow you to eliminate foreign transaction fees and provide convenient ways to pay for essentials. When selecting a bank, consider factors such as banking fees, minimum balance requirements, overdraft charges, and international activities. Some banks, like Bank of America, offer special programs for international students, providing benefits such as protection from unauthorized transactions.

Additionally, you can use a credit card to receive money through wire transfers. Wire transfers are known for being safe, secure, and fast, making them ideal for sending large amounts of money to cover tuition and living expenses. However, it is important to note that international transfers are typically more expensive than domestic transfers, and you cannot reverse the transaction once it has been sent.

To avoid international transaction and currency exchange fees, experts recommend opening a US bank account upon arrival. During international student orientation, many schools invite bank representatives to assist students in opening their accounts. This can be a great opportunity to ask questions and gain a better understanding of the US financial system.

Online money transfer services

As an international student in the US, you may need to receive money from abroad to pay for tuition and living expenses. While traditional banks are a reliable option, they can charge high fees for transferring money internationally. For example, wire transfer fees can range from $15 to $50, and traditional banks often charge a margin of up to 5% above the daily exchange rate. Additionally, there may be a waiting period of a few days before you can withdraw the money you deposit.

To avoid these fees, you may want to consider using a money transfer specialist or non-bank payment service provider (PSP). These platforms tend to have much lower rates than traditional banks, and they allow you to transfer, receive, and spend in different currencies with zero or low fees. Examples of such providers include Wise (formerly TransferWise), OFX, CurrencyFair, and TorFX. With TorFX, you can arrange transfers online, over the phone, or through the TorFX app. Western Union is another popular option for sending and receiving money internationally, with thousands of agent locations worldwide.

It's important to note that money transfer specialists and PSPs are not banks, so you cannot get an overdraft, loan, or earn interest on savings through these services. They are meant to be used alongside a traditional bank account. Therefore, you may want to consider opening a bank account in the US, which will allow you to easily receive and withdraw money. Most banks will provide you with a debit card that you can use to withdraw money from ATMs and make purchases.

When choosing a money transfer service, it's essential to consider the fees involved, the exchange rate, the security of the platform, and the convenience of the service. It's also a good idea to shop around and compare different providers to find the best option for your specific needs.

Frequently asked questions