​​A Complete Guide To Overseas Money Transfer From India


​​A Complete Guide To Overseas Money Transfer From India

By Jupiter Team · · 5 min read

We Indians have always fancied going out of the country. We hardly heard of going abroad for travel, studies or business a few decades ago. But in recent times, people are moving across countries to explore opportunities and travel. As a result, overseas money transfers from India have also increased.

Though highly regulated, transferring money abroad has been made simple over the years. Read on to find out the different ways of transferring money abroad from India.

What is an international money transfer?

When you send money directly to the bank account of a person living abroad, you are doing an international money transfer. You can transfer money overseas from India through a bank, post office, or digital payment platform. The person you send money to is known as the beneficiary, and the bank to which the funds are being sent is known as the beneficiary bank.

In India, the transfer of money from India is regulated by the Reserve Bank India (RBI) through a process called outward remittance. The maximum limit for remittance is $250,000 per financial year for the purpose of leisure, study, travel, and employment.

How to transfer money to another country?

The following are four different ways to transfer money overseas from India.

Bank Drafts And Cheques

You can send money overseas by purchasing a draft or cheque in the currency you want to send money in. They are very safe as they can be traced easily. Moreover, the charges in this type of transfer are much less, hence considered the most inexpensive transfer method. However, sending money through demand drafts and cheques takes a very long time.

International Money Order

Money orders have existed for a long time. They are the safest and cheapest form of sending money abroad. You can easily deposit a money order in your bank or encash it at any cheque-cashing location. However, sending money through money order is a time taking process as opposed to other methods.

Online Money Transfer

This is the most convenient and fastest form of transferring money overseas from India. You can transfer money from the comfort of your home. All you need is destination bank details such as the international bank account number (IBAN), the Society for Worldwide Interbank Financial Telecommunication (SWIFT) code, and the beneficiary bank account details. Since it excludes intermediaries, it is the fastest mode of transfer. However, it is also very expensive as it includes taxes and a high exchange rate for fast service.

Online Wire Transfer

Wire transfer is one of the latest methods of transferring money abroad. You can do a wire transfer through authorized financial institutions such as banks and exchangers. It includes a lot of intermediaries and hence takes some time for the transfer to happen. However, this reduces many overhead charges you would otherwise incur in a direct transfer. Hence wire transfers are the most preferred method for overseas money transfers.

What documents are required to transfer money abroad?

Following are the documents required to transfer money overseas from India.

  • Copy of PAN Card
  • Form A2
  • Proof of adequate funds
  • Original fee or receipt or bill

Factors to consider before transferring money internationally

Before transferring money internationally, there are a few factors you must consider.

Speed: When transferring money overseas from India, you should consider the time it takes for the money to be credited to the beneficiary's account. For online transfer, it will take 48-72 business hours, and for demand drafts and cheques, it can take up to a few days. Also, the faster the speed of the money transfer, the higher the fee.

Exchange rate: Foreign exchange rate is the rate at which one currency is exchanged for another. The exchange rate is determined based on the fluctuations in the international market and differs from bank to bank. When doing an international transfer, you must check the exchange rate. Even a small difference in the exchange rate can make a big difference if the amount to be sent is huge.

Overhead charges: Just like how you have transfer charges for your account in India, you will also have transfer charges for overseas transfers. The transfer fee can be a fixed or a percentage of the amount being transferred. Apart from this, there is also a foreign conversion charge and service tax for each party in the transaction.

What are the main reasons for international money transfers from India?

There are several reasons why people transfer money overseas from India. Below are just a few:

  • To study abroad
  • Travel or vacation
  • Medical treatment abroad
  • Overseas investments
  • Buying property abroad
  • Supporting a family member living abroad
  • Paying overseas bills
  • Employment abroad

How long does it take to send money abroad and for the recipient to receive the money?

In the case of wire transfers, the time taken to transfer money to the beneficiary is five working days or more. For online transfers, the time taken is one to two working days, depending on the currency. Transfer to a more popular currency will happen faster than a less popular one. In the case of demand drafts, the time taken is longer than five days and hence is the slowest.

How to transfer money to a foreign bank account from India?

You can transfer money to a foreign bank using an international money order or bank draft. You can use direct online or wire transfer for a faster transfer. If you want to know more about international money transfers, you can read more about this here.

What is the cheapest way to transfer money from India to the UK?

The cheapest way to transfer money from India to the UK is through international money orders. It is not only the cheapest but the safest mode of transfer. However, it takes a lot of time for the money to be credited to the foreign account in the UK. You can read more about the cheapest way to transfer money here.

What are the different ways to transfer money internationally?

The different ways to transfer money internationally are international money orders, bank drafts and cheques, and online and wire transfers. Each of them has pros and cons, so pick the ones that best suit you. You can read more about the different ways to transfer money here.

Is it safe to transfer money from India to abroad?

Yes, you can safely transfer your money from India to any country. The RBI highly regulates it, so you need not worry about the money getting credited to the wrong account, provided you have the recipient's correct bank details. You can read more about this here.

Is it safe to transfer money abroad?

Yes, it is safe to transfer money abroad. The safest way to transfer money abroad is by bank draft and international money order. You can read more about this here.

Are there any restrictions towards remittances from India?

As per the RBI’s Liberalized Remittance Scheme (LRS), you can freely transfer up to USD 250,000 per financial year. Any amount beyond this requires prior permission from the RBI. You can read more about restrictions towards remittances from India here.

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