If you are an expat living in Germany, or you are planning to move here, sooner or later you will require transferring money from your home country to a bank account in Germany. Fortunately, sending money in Germany overseas is a pretty straight-forward procedure. You will need to buy yourself a house, pay utility bills, college fees or send money back to support home. Regardless of what the money transfer reason is, guidance will be same.
There are few aspects you need to consider before choosing to send money. This includes fees, exchange rate and transfer time. For transferring money, there are multiple options in Germany. Each one of them has their own pros and cons. In current times, mobile and online banking has made it fairly easier to transfer money overseas. Even then it is a nerve-wracking process when trying to ensure you are doing it in correct manner.
This guide below will walk you along the way to educate the complete procedure.
Sending Money Overseas in Germany
Among EU countries, Germany sends more money internationally as compared to other countries. In 2019, US$ 19 billion was the total outflow. This amount is almost 18 percent of the total outbound remittances by EU countries. Most of the overseas payments are sent to France, Poland, Turkey, Romania, Austria, Netherlands and United States.
There are several options for transferring money overseas in Germany. You can do it in person, in a bank, through online website, through mobile banking or by using money transfer services available online. The procedure takes several hours, sometimes several days too. This depends on the method which you are opting for. Costs do vary according to the chosen method. The exchange rates are different for online money transfer service and banks. It is advised that you keep these factors in mind.
Sending Money Overseas Through Traditional Bank in Germany
Sending money overseas in Germany can be done through banks. Almost all banks in Germany offer the option of transferring money overseas with the help of SWIFT (Society for Worldwide Interbank Financial Telecommunication) code. You can use this option by either going to a branch yourself, by using a bank app, or by going online.
Transferring Cost via Traditional Bank
German banks charge a flat fee for transferring international funds. This is a good option if you have to send large amount of funds. That being said, there are often some hidden charges as well, which are usually not transparent. At times, there are margins to exchange rate too. There can be an additional 5 to 7 percent margin for exchange rate.
If you are using online option or the bank app option, you might incur extra fees. Sometimes, fees are added on both sides of the transfer, which later increases the overall cost of transferring money. This decreases the actual amount which is ultimately received to the recipient. You should keep this in mind and ensure you are aware of all the associated costs which are incurred throughout the process.
The transfer cost through a traditional bank is also dependent on type of account you have. Some banks do provide free international transfer for their premium customers. Hence, it is suggested that you explore all options before transferring money.
In case you are transferring money within Europe, your transfer may lie under the Single Euro Payment Area (SEPA) agreement. This is a beneficial facility which goes throughout European borders. It makes the cost of international transfer same as local transfer. You can gather more information at your respective bank.
How to Transfer via Traditional bank
You have to make available the below-mentioned information before sending money overseas from a German bank:
- Recipient’s complete name
- Recipient’s bank name and address
- IBAN (International Bank Account Number)
- SWIFT / BIC (Bank Identification Code)
- Account Number
In Germany, the transfer process is around one to five working days for majority of international bank transfers. You can also expedite the process as some banks do give you paid options. That being said, faster transfer time does come at a cost. Hence, it is recommended to plan in advance when you have to send money.
Sending Money Overseas via Online and Mobile Banking
Most people these days prefer online options for managing their finances. Online and mobile banking facility does offer convenience to customers instead of bothering them to visit the bank in person. For ex-pats, fortunately, most German banks provide banking through online and mobile apps.
Along with this, there are numerous mobile-only and online-only banks which have started in recent years. Below-mentioned is the following:
- N26 – Mobile banking app having English and German website
- Bunq – Mobile banking app with English website
- DKB – Germany’s 2nd largest direct bank
- Revolut – Mobile banking app having English and German website
- Santander – Online and telephonic bank service provider
- Comdirect – Germany’s 3rd largest direct bank
Transferring Cost via Online and Mobile Banking
The charges for sending money overseas in Germany online through a bank are usually the same as if you are visiting a branch physically. On the other hand, digital banks like N26 have monthly charges which is account service fee. The fee can range between 0 euro and 17 euros a month. There are no additional-hidden charges, foreign exchange fee or transaction fee on international fund transfer. That is why this option is one of the most convenient one for expats.
How To Transfer via Online and Mobile Banking
If you already have an account opened at a bank in Germany, using online and mobile banking is very simple and straightforward. You can head on to the internet and download the banking application of your respective bank and use the information of your existing account for signing in and creating profile. After this, you are good to access all the features of application, including international transfer.
In case you don’t have an account opened at a German bank, it is then required to open one before you download the bank’s application. The information which you will provide in the online and mobile app will be same as the one which you provide when visiting bank in person. This information comprises account number, name of recipient, respective bank name, address, IBAN and SWIFT code.
Both the options of traditional bank and mobile banking are safe and secure. The security protocols for both mediums are the same. Banks do offer ID protection i.e., fingerprint and face/voice recognition, instant blocking of stolen and lost cards.
Sending Money via Online International Money Transfer Service in Germany
Other than traditional banks, you will find numerous online money transfer service providers. These services allow sending money overseas in Germany. The main advantage you can get from these services is that you can easily transfer money without needing to enter a bank physically. The Financial Conduct Authority (FCA) regulates most of these services. These are licensed as Electronic Money Institutions.
These services do have a drawback though. You can make a limited number of transactions in a day due to restrictions. This regulation is from the government. However, on a realistic scale, it is very unlikely that you reach those limits. The most common online money transfer services in Germany are the following.
You will have to sign up and create an account when planning to transfer funds internationally using these online services. You will then enter your details and then account will be verified. Sometimes, it takes multiple days for the account to come live and ready. It’s better to complete the procedure a few days in advance if you have planned to send money overseas on a specific date.
Once the account is set up, you shall send money overseas straight away. The money will get transferred within few minutes or might take up to 5 working days. The duration depends on which service you are opting for. Do keep in mind that charges/fees can be around 0.5 percent to 4 percent of the total amount you are transferring.
Transferring Cost via Online International Money Transfer
The overall cost that you will be paying for transferring money will depend on multiple factors. This includes the transfer service you are using, the amount you wish to transfer and the speed of transferring. And obviously the exchange rate will also come in play at the time of transferring the money.
Whichever option you opt for, it’s crucial that you are aware of the final cost before you have transferred any amount. You need to understand one more aspect that even though some services will charge less fee for money transfer, they are likely to have high exchange rate. This can rise the total amount, and you will end up paying more.
How to Transfer via Online International Money Transfer
After you have decided the money transfer service of your choice, it’s time to create an account on the website of respective service provider. To perform this activity, you will have to enter details like your name, date of birth, email address and contact number. Though it varies from service to service, you may need to verify your identity too.
After setting up online account, you have to provide transaction details. The required information is as follows:
- The amount you are sending
- Your amount’s currency
- The currency money should get converted into
- Whether standard time is fine or you need fast transfer
After this, you will have to provide details of the recipient. This information includes the recipient’s name and their bank account number. Later, you will have to pay the amount to transfer service with a debit card or credit card. You can also use bank transfer. Once the money has been transferred to the service provider, they will initiate the process of transferring money to the recipient. Once the process is finished, you will get a notification stating that the amount has been successfully transferred to the recipient’s bank account.
Sending Money via Wire Transfer Companies in Germany
International money transfer agents are also a way to transfer money overseas. These transfer agents include MoneyGram, Western Union and Exchange4free. This can be considered as a convenient option too since it doesn’t require a bank account for either sender or recipient. For those who don’t want to open up a bank account in Germany, this seems like a feasible option. There are two ways to perform wire transfer in Germany. You can do it by going physically to an agent, or you can go online. The online option is more handy and also a cheaper option.
Transferring Cost via Wire Transfer Company
Wire transfers are a faster option for sending money as compared to other money transfer mediums. There are also more convenient to use in comparison with bank transfers. But you must be aware that they are not a price-friendly option. Almost 7 to 10 percent of the amount you will be sending might get charged in terms of commission. On the other hand, if money transfer is time-sensitive, and you want to transfer the amount as quickly as possible, this is the best option.
How to Transfer via Wire Transfer Company
When you plan to wire money from Germany, you will have to pay the amount in cash to the service agent. You will then provide the recipient details and where the recipient will collect the money. Your recipient will have to visit the office of same agent in their own country of residence. They must take their ID with them in order to claim the received funds. To wire funds, you can also pay the service agent using credit or debit card. Bank transfer can also be utilized.
The biggest advantage in wire transfer is the ample quantity of agent locations present around the world. However, a big disadvantage is the cost you bear for this convenience.
Here are some tips you can use to save money before transferring money from Germany and vice versa.
- Send large amount: it is always cheaper to transfer a large amount at one time, rather than transferring small amounts several times.
- Don’t pay extra for speed: if you are planning to send money overseas and your recipient is not in a hurry to receive the funds, you can always go for a longer time period to save money.
- Minimum transfer amount: some of the services do not allow to transfer funds under a certain minimum amount. It is advised to thoroughly check the terms and conditions of the service provider. This will help you get the best possible rate.
- Transfer options: there are a few transfer agents who provide the service of locking at an optimal exchange rate and transferring the amount later. This way, you can plan the transfer ahead and your amount will only gets transferred when the exchange rate is optimal. This option is feasible for those who are not in a rush to send funds.