The process of outward remittance is that of sending money abroad, and it is a process that is governed by many regulations. The process of outward remittance is mostly done via banks. Although, you need to remember that you cannot trust any individual or financial firm with the task of sending your money. However, people still rely on these agencies a lot as they are faster than the banks but also charge a lot. That is why the process of outward remittance is only applicable to banks.
There are many options to send money overseas. However, only three are used all over the world because of their efficiency and reliability. The process of outward remittance states that the transactions can be done only through banking or building societies. The process of outward remittance does not encourage foreign exchange (FX) brokers or through high-end firms like the Western Union or Forex. As a general rule of thumb, the process of outward remittance states that banks are on the top because they are the safest ways to send money.
Coming in next are money transfer firms. Although incredibly fast, they are way more expensive, especially if the amount you are sending is a small one, than your normal banks. The process of outward remittance does not encourage this as well.
However, FX brokers are probably the best choice, if you do not want to go through the process of outward remittance if the amount you are sending is over 3000$.
Now, assuming that you have chosen your bank as a medium to get your money safely overseas, the next thing you need to think about is the mode of payment. There are many ways in the process of outward remittance to send your money. One way to process it is to get a Foreign Currency Demand Draft. This draft can be denominated in the desired foreign currency but must be drawn in favor of the person receiving it.
The countries already well versed in some form of money transfer system are the United States, Russia, Canada, The United Kingdom, Australia, Philippines and much more. They are so successful because they follow the process of outward remittance. India has recently started showing its capital prowess and has ventured into the online marketplace quite smoothly and is holding on its own. Other developing countries include Sri Lanka, some of the African countries, etc. These countries need to grasp the process of outward remittance.
While planning to carry out overseas money transfers, say from Australia to Philippines, you must be aware of certain terms, like what foreign exchange rates are and how the process of outward remittance helps it. In simple words, exchange rates are the value of one country’s currency as compared to another. For example, value of the Australian dollar is higher as compared to Philippine peso ( for money transfer procedures from Australia to Philippines ).
These are the basic things that you as a sender should keep in mind. Transferring money is a very personal business, and it should be done with extreme care and caution to ensure a smooth transaction.
However, the most important question you should be asking yourself before you make any decisions is ‘when.’ When should you exchange or transfer money to reap the most profits?
The answer is very simple. You do not need to think a lot about rates when you exchange money since the economy adjusts to the rates most of the times, so it is not a thing that you need to worry about. You can transfer or exchange money whenever you want and for whatever purpose you want.
For example if you need to transfer money to Philippines from Australia you can do it under the government’s and your bank’s eye, by filling a form which is an outward remittance request form and all the details stated on it should be true and written clearly. You will also need to show the source of the money if the amount you are sending is a significant amount. The per year limit for a person to send money overseas in two hundred thousand dollars. These rates are pre-informed to the customers by Forex but just to be on the safer side, one must cross check these charges with the Forex rate card of the bank.
The process of outward remittance is something that is a must for an economy to grow.