Most people rely on banks for international money transfers and online money transfer services, which somehow can be considered the safest way to do so, yet if you have ever gone through the process of sending money overseas using any of these enterprises you know that it´s not always a smooth ride. Banks would argue there is no safest way to do this, to fight back the revolution brought by the blockchain and cryptocurrency. In 2016 Santander made 10% of their profits off of money transfer fees according to Find.Exchange News. So what should we expect for banks to say?
Let´s take a look at the steps to a traditional money transfer service:
First, you walk into a money transfer location and tell them you want to send money, inform the name of the person you are sending to, the city and country they reside. They will take your information and do everything else for you to ensure your money arrives at the desired destination. Some companies may work with same-day-transfers for an extra fee, but usually it may take days, and fees may vary according to the amount you are sending as well as how fast you desire your money to get to its destination. You can also transfer money online, which usually takes the same steps. It´s quite simple, but fees can be high and the time of arrival is slow.
And if you´re doing this through bank wire, you will have to provide a lot more information, account number, routing number, SWIFT code, etc. and pay much higher fees than money transfer services. Transfers can take 3–5+ days to get to your chosen destination.
I used bank wire once, to never again. I´ve had people send me money through bank wires and it is never a smooth ride. It´s a hassle.
So, I started using money transfer services over 20 years ago, I have lived in different countries throughout the years, and money transfer has been a big part of my life. Today, I am used to the terms, how it works, and the time stores open and close, and how much it costs. I never stop to think if I should trust all these different companies to transfer my money around, or even if there are better ways of doing so until cryptocurrency showed up in my life about a year ago.
That’s when I realized that what I call simplicity happens to be more like convenient than simple, simply because it is all I know, and it served the purpose for the time being. But evolution is inevitable, and now we have something new and better, yet, it is something never seen before. So at first, it may not feel like it is better or easier.
My point is, we must learn there is a LEARNING PERIOD when it comes to anything new that will defy what we know to teach us something we have nothing to compare. In our days, we must learn to expect the unexpected when it comes to technology.
The blockchain and cryptocurrency technology happens to be an entirely different concept from the traditional financial systems, it’s like when we first heard about the internet, it was new, modern, fast, but it didn’t feel as cool or as easy to everyone.
I think you get the point.
Let’s take a look at what it would be like to transfer cryptocurrency (assuming you do not own cryptocurrency or would need to acquire more):
The entire process is online. Let´s say you would like to send WCO crypto, using your credit/debit card, you send your fiat currency to a crypto exchange to buy WCO and from there send it to your destination/recipient´s wallet.
The recipient will receive it in their wallets in a matter of seconds. He or she will then bring the WCO into an exchange, convert it to fiat currency (assuming that is what they would like to do) — and withdraw the money straight to their bank account. And it is done.
If you already own cryptocurrency, you can skip the converting process and it will be even faster. Money transfer using cryptos is a process like no other:
· No middle-men;
· Fast as Lighting;
· High-level Security;
· At any time;
· From anywhere in the world;
· To whomever you want;
· As much as you want.
It might be hard to send 10,000 USD to another country through a money transfer service or bank wire, but convert it to cryptocurrency, and you can send that money to anyone, anywhere, in seconds/minutes on the blockchain.
The main advantages with cryptocurrency transfers are the fees and the speed.
Even though the process seems to take a few more steps than with the traditional money transfers, for now, until cryptocurrency becomes mainstream, this system will mainly serve the people who need to prioritize expenses and speed. Until eventually conversions will no longer be as needed and the technology will adapt as we adopt. Another advantage is that you get to do it all by yourself — which some people find excellent and others not so much.
Traditional money transfer services make money by charging for deposits, withdrawals, and transfers. Also, they make money on the exchange rate when converting your money. For example, BRL/USD, If 1$ USD equals to 3.75$ BRL today, brokers rate may be at 4,00BRL for each dollar so they can make that extra cash.
With cryptocurrency you must be mindful of the exchanging prices; you convert your money twice when you send it to someone in another country. First, when you buy cryptocurrency using your local fiat currency to send it, and second, when receiver exchanges the crypto to his or her local fiat currency.
If you do not want to lose money, this is a process you must be conscious about in order to make the best trade possible on the exchange platforms. Be aware it is still a volatile market which you can make it work for your advantage.
Most cryptocurrency wallets and exchanges do not charge deposits. Withdrawals and transfers with applications like the Okane Pay App, you pay less than 1% of the amount you are transacting. There are also charges to transact on the blockchain, which will cost a couple of dollars depending on how long you stay and transact on the platform (Same for the person receiving). In comparison to the traditional methods it is cheaper for sure.
Western Union, one of the most popular money transfers in the world, it costs 12.99 USD to send 100$ online if paid with credit/debit card to arrive the same day. All other options to send will take from 2 to 6 days and will cost anywhere from .99 cents to 110.00 USD. (Only Sends up to 5,000 USD.)
For example, if I want to send 100$ USD to my daughter in the US from Brazil, it would cost me .99 cents (USD), and it would take 6-days to get there. If I wanted to send 10,000 for her sweet sixteen, I would have to send 5,000 in one month, and another 5,000 the next, and if I want it to get there within 2-days I´d pay 110$ each transaction.
Would this type of service work for you? It’s all about your priorities. What do you need money transfers to do for you? Do you need it to be fast? Do you need to be cheap? Do you need it to be secure? All of the above?
According to coinrepublic.com PayPal charges up to 8% to handle transactions, and clients can claim chargeback within 60 days. In other words, you get paid, use the money, and if the person who paid you decides they want their money back (which they could claim anything) PayPal will take the money back from you, even if they have to go into your bank account on file. Wow. I use PayPal to receive money as well, and though I have never had any issues with frauds the fees are extreme.
Cryptocurrency transfers are irreversible it protects the person receiving from any kind of fraud.
Wire transfers cost anywhere from 25 to 45$+ USD in fees.
The only real downside I see with crypto transfers is that cryptos are not as popular as fiat currency yet, which makes the process more difficult due to conversions, but imagine how much faster, cheaper and convenient this process will become once cryptocurrency hits the mainstream?
The combination of cryptocurrency and blockchain is disrupting money transfer business, especially for international transfers. It is only a matter of time until it becomes popular and effective as it can be.
Using cryptos for money transfer has the advantage of not relying on any government. This is a critical advantage, the public must understand its power and make it unstoppable.
Transferring money from one country to another can be slow and expensive. It could take days and several middle-men, intermediaries, and compensation for each one of them, making cryptocurrency transfer an attractive alternative to cut back on the expenses, and limitations that come with traditional money transfers.
When you cut down the mediators and pair it up with lightning speed, you cut down costs effectively!
Money transfer using cryptocurrency on the blockchain means greater financial freedom, low costs, and more privacy, fewer restrictions, fewer fraud issues, more safety, and immediate settlement for any transaction. It can represent a lot more once it takes the position it deserves, even if it is threatening to certain institutions. Evolution is imminent.
I am ready for safe and fast money transfers, are you?
Let us know your thoughts in the comments. Let us know the pros and cons from your point of view. What do you think of the technology? Would you give it a go? Why? What kind of service are you using to send money overseas?
Tell you about your experiences.
Disclaimer: Our team works hard to bring you the best content in the cryptocurrency market, but it is only our point of view and not legal advice, and may be divergent from other opinions, so please do not make any decisions without concluding studies of your own to understand the profit possibilities and uncertainties involved at your own risk.