Many countries require money transfer companies to be licensed by the country’s banking regulator. Most countries that require licensing also require bonding and insurance to recover lost funds if the company fails. One way to protect yourself from fraud is to make sure you are using a licensed money transfer company.It is illegal to operate a money transfer business without a licence.Money transmitters operate through agents such as travel agencies and multi service stores that many people use to send money.Agents are not licensed but they must have a contract with a licensed transmitter.Agents must post signs in English and other predominent languages spoken by customers with the name,address and telephone number of both the agent and the licensed transmitter.Its also important having a record of the transaction e.g a receipt,e-mail or sms notification to trace your payment and resolve any disputes if they ever arise.
It is important to note and ask the following:
- Unfavourable exchange rates add to the cost of sending money Ask how the exchange rate is calculated,and how much money will actually be paid to the recipient
- Find out whether the recipient will be charged any fees when they pick up the money.
- Some banks offer low cost transfers to certain countries.Make sure to ask if you must keep a minimum balance in your bank account,if the recipient needs to have an account,how the exchange rate is calculated and what fees may be charged to you or the recipient.
- You have the right to transfer money in U.S dollars unless the receiving country requires money to be converted to the local currency
- Be careful with money transfers offered through pre-paid debit cards.These cards often carry high and hidden fees.
It is always important to ask all the relevant questions when sending money back home as this ensures that you get the best deal possible and this guarantees that your recipient can get the most out of what you send.