How to Send Money to Canada
With plenty of options to send funds to Canada, there are many things to consider before choosing the best one for your needs. This guide compares all the alternatives, providing detailed insights into why money transfer services such as XE Money Transfer, WorldRemit, and TorFX emerge as some of the best options. Learn how to compare services based on your unique needs, as well as how to send money to Canada in three simple steps!
How to Send Money to Canada Using a Money Transfer Provider?
The process of sending money to Canada by using an online money transfer service is simple. You only need to follow these three steps to execute a transaction!
Step 1: Compare providers to find the one that best fits you
Step 2: Sign up with the chosen provider
Step 3: Transfer money
How to Send and Receive Money in Canada?
According to GPFI, remittance inflows to Canada totaled CAD911 million in 2020, while the remittance outflows were CAD6.5 billion. With that big of a volume comes a large pool of money transfer options to choose from — all of which are reviewed below.
Ways to Send Money to Canada
Below is a rundown of the alternatives for sending money to Canada. Each of them is reviewed by considering all the requirements needed to perform a transaction, as well as costs and transfer time, along with information on how they compare against other methods.
Money Transfer Services
A money transfer service is an online-based platform that allows sending funds internationally. These platforms, such as XE Money Transfer, WorldRemit, and Wise, are the fastest, easiest, and often cheapest ways of sending funds to Canada.
Depending on the service and your payment method of choice, transactions could complete in minutes. While some methods require being patient for several working days, the majority of transfers occur on the same day.
You only need to register an account with the desired money transfer service to send funds to Canada. The money could be on its way in minutes, removing all the hassle that comes with some other methods to send money.
International wire transfers aren’t a convenient way to send money to Canada. Depending on the chosen platform, you might wait up to five working days for the transaction to complete. Besides the intermediary, the receiving bank could also charge for the service, adding up to high costs. On top of that, currency exchange services come at unfavorable rates, making wire transfers one of the least convenient options for sending money abroad.
Bank Account Transfers
Scotiabank and RBC Royal Bank are among the institutions supporting international transfers in Canada. While this is a reliable way to send money to this country, it’s also costly and slow. The exchange rates are often unfavorable, and participating banks could charge large fees. The transaction might take several business days to complete, adding up to another inconvenient option, especially if you have a money transfer service available in your location.
Challenger banks—such as Starling, Monzo, and Revolut—are small banks that don’t have a long tradition in the market. They “challenge” traditional banks in a specific area, and some focus on sending funds internationally. If these banks support sending money to Canada, you are likely to face unfavorable rates and high fees. As small banks, they might have liquidity problems, too, so it’s best to avoid them for large transfers.
Mobile Apps and Payment Services
Mobile payment services—such as Apple Pay, Google Pay, Venmo, and Zelle—are those that focus on allowing you to send funds via a mobile app. Their availability depends on the location, but they work based on the same principle; you install the app on your smartphone or tablet and execute the transfer. The fees vary, but they usually aren’t as favorable as those offered by money transfer services.
PayPal is a reputable electronic payment service that’s been in business for over 20 years. It’s reliable and secures almost instant transfers to another PayPal account. The platform is fast and easy to use and even has the advantage of anonymity, considering the receiver can only see your PayPal email address. However, it all comes at the cost of high fees and unfavorable exchange rates.
Transfer Money to Pick-Up Location
Western Union is the best example of this service type to send money to Canada. The funds you transfer become available at a licensed provider in the desired destination country for the receiver to pick up. Western Union has over 2,500 licensed locations throughout Canada. While the fees are more reasonable when compared to the options above, money transfer services are still a far better option for sending money to this country.
International Money Orders
Not many countries accept international money orders, but Canada is among them. This is a convenient option to send money to Canada from countries like the USA. You need to visit a postal service to create a money order. The maximum money you can send is $700 (CAD999.99), and you’ll need to pay the issuing fee. While some could find it convenient, an international money order isn’t the cheapest or fastest option for transferring large amounts of money to Canada.
What Do You Need to Send Money to Canada?
The process of sending money to Canada isn’t complicated, and there’s a generalized list of requirements you’ll have to consider before doing so, such as
A valid ID. Most platforms require a copy of a valid document to verify your identity;
A deposit method with the amount you intend to transfer. You could add funds from a bank account, use a debit or credit card, etc.;
Recipient’s information. That includes their name, phone number, address, and similar details.
Factors like the platform itself, the type of the transfer, and its amount could bring about additional requirements, but they’ll be specified in the website’s terms and conditions.
What Are the Ways of Receiving Money in Canada?
Receivers can choose to receive money directly to their bank accounts, with the alternatives being a cash delivery via an agent or picking up the funds at a licensed location. Here’s a detailed overview of these options!
It includes picking up money at the specified location licensed by the sender’s money transfer service of choice. For example, if the sender uses Western Union, you need to go to the closest WU branch to pick up the funds. You’ll need to prove your identity and provide transaction info to verify it.
Direct Bank Deposits
While inconvenient for senders, bank deposits are one of the easiest options for receivers. The money gets directly to your account, and you can check the balance to see if the transaction was finalized. The only downside is that the fees are high, and even your bank might charge one for the service.
Cash delivery involves receiving cash via a nearby agent. It’s convenient for small sums, and it involves cashing a money order or bank draft. Similar to location pick-ups, you need to go to a licensed branch to collect the money.
What Do You Need to Receive Money in Canada?
For most money transfer options, receivers should have the following to collect the money:
A valid bank account — necessary if the sender will deposit funds directly to your account;
Reference numbers — or confirmation codes issued by some services to verify the transfer;
A valid ID — to confirm your identity to collect the funds;
Sender’s details — such as their name but also other transaction details.
Top Money Transfer Providers to Send Money to Canada
XE Money Transfer – Best for Sending Money to Canada
Based in Canada, XE Money Transfer supports over 130 countries and offers some of the best exchange rates. Fees only exist for transfers under CAD500, and choosing a lower transaction amount will only cost you CAD3, which is still quite affordable. The transfers are fast but don’t forget about the potential third-party fees for a transaction.
No fees for transfers over CAD500
Favorable exchange rates
The platform is available in multiple languages
Fees apply when transferring smaller amounts
It’s not available in all countries
3 Steps to Start Using Provider
Step 1: Head to the XE Money Transfer website.
Step 2: Use the converter tool to check the rates.
Step 3: Confirm the transaction and track the progress.
Western Union, PayPal, Wise
WorldRemit – Best User-Friendly Interface
Boasting over 5,000 transfer routes, WorldRemit completes 90% of transfers on the same day and gives a two-day limit to process the transaction. Transactions you can make with this provider are capped at a maximum of USD5,000, and bank transfer is the only available method to senders. The fees on WorldRemit vary based on the sender’s country. For example, it costs USD2.99 to send money from the USA. While it could be a bit more expensive from other locations, it rarely goes over USD5.
A reliable and reasonably fast service
A simple user interface
The maximum amount per transaction is USD5,000
Bank transfer is the only available option to send money to Canada
3 Steps to Start Using Provider
Step 1: Visit the WorldRemit website.
Step 2: Choose the currency to send money to Canada.
Step 3: Check the fees and confirm the transaction if you agree.
InstaRem, Wise, Key Currency
TorFX – Best for Large Transfers
Operating since 2004, TorFX offers various services, one of which is sending money to Canada. There aren’t any fixed transaction fees or hidden charges. However, TorFX is primarily a currency broker, indicating it uses exchange rates to charge for transfers. The estimation is that the platform earns about 1.9-2.7%, depending on how much you transfer. And the good news is you can transfer any amount starting from USD200, with the largest exceeding USD250,000.
An excellent choice for transferring large sums
Fast and reliable customer support
No transaction fees
The minimum transfer amount is USD200
Bank transfer is the only available option
3 Steps to Start Using Provider
Step 1: Head to the TorFX website and pick from personal and business transfers.
Step 2: Ask for a free quote for the desired transfer and enter the necessary details.
Step 3: Approve the transfer if you are happy with the terms offered.
VertoFX, Western Union, WIse
What Are the Fastest Ways to Send Money to Canada?
Even though most platforms in this category promise same-day transactions to be on the safe side, the majority of them will be completed as fast as possible — in some cases, within minutes. This, however, can come at the cost of higher fees. Below are the services providing the fastest money transfers to Canada.
Besides being the ones offering the fastest money transfer services to Canada, these providers are also the ones doing it for the most reasonable fees. When compared to others, they also have fewer restrictions regarding the amount of money and the payment methods that can be used for fast money transfers, as well as a reliable reputation.
What Is the Cheapest Way to Send Money to Canada?
Fees are a common issue related to money transfers, especially variable ones, and when sending large sums. While there are plenty of platforms that carry out transfers at a 0% fee, one way they charge you is by taking longer to complete transactions. Here are the cheapest ways you can send money to Canada.
These providers do not only offer the cheapest money transfers to Canada but also aim to do so without compromising transfer speed. With most transactions being carried out in as little as a few business days at most, these services also provide reliable transfers at reasonable exchange fees.
What Is the Safest Way to Send Money to Canada?
At Money-Zine, we only select safe and reliable international money transfer providers. Beyond the tradition of maximum dedication to safety, these platforms stand out from the competition by offering maximum security!
Transfer security should come at no additional cost. The above services provide money transfers at favorable or no transaction fees by employing additional safety features going beyond the industry’s standards. Besides providing the safest ways to send money to Canada, using these money services also guarantees fast transaction processing and reasonable transfer times.
What Are the Best Apps to Send Money to Canada?
Many international money transfer providers have dedicated mobile apps to use on Android and iOS devices. But apart from the conditions for sending money to Canada, it’s important that the entire experience is optimal. You need the app to be bug-free and straightforward, so you can easily send the desired funds.
Here’s a quick selection of the best apps to send money to Canada!
Apart from being one of the most convenient ways to send money to Canada, these apps are owned by established money transfer services guaranteeing maximum security. They provide speedy transactions at competitive fees without reducing the minimum amount that can be transferred.
Things to Consider When Sending Money to Canada
From money transfer regulations that vary based on the amount being sent and the purpose of the transfers, all the way to the cost of it and how quickly it will arrive, here are the top considerations for sending money to Canada!
CRA (Canada Revenue Agency) and FINTRAC (Financial Transactions and Reports Analysis Centre of Canada) are authorities in charge of monitoring international money transfers in Canada. Banks and other money transfer services have an obligation to report transfers over CAD10,000. If the sum is high, the bank might ask the receiver to specify the source of money when getting funds in Canada, which could be anything from a gift from a family member or friend to a legitimate business sale.
How Much Are You Sending Abroad
The amount you send can affect the fees you’ll need to pay for the transfer. Some platforms have fixed fees, regardless of the amount you send. For higher sums, others can charge more, less, or even waive the fee altogether. Another thing to consider is that the receiver in Canada might need to provide additional info on the source of money. So both parties should secure all the documents needed to make sure both the sender’s platform and the receiver’s bank accept the transfer.
The Cost of Money Transfer
There are two types of charges when sending money to Canada; transaction fees by the actual service that not all of them impose, as well as third-party fees taken by other institutions participating in the transfer. For example, the sending and receiving banks might both charge for the service. Other things that can add up to the transfer price are exchange rates, so make sure to consider them when calculating the total cost of the transfer.
Payment Type and Reason for the Transfer
Money transfers can be issued on a personal or business basis. The fees are usually higher for business transactions, but it depends on the platform used. The good news is money transfer services might offer multi-currency accounts and other features to simplify the transactions.
It might be necessary to pay certain taxes for business transactions, so pay attention to the relevant laws. The receiver is the one who might need to pay an income tax on the sum received. As for personal transactions, you could send funds as a gift. It’s only necessary for the receiver to report them if received regularly or if the amount is unusually high.
Safety and Security of the Provider
It’s crucial to use a regulated provider to ensure your money stays safe when sending funds to Canada. All recommendations in this guide are licensed and regulated by relevant authorities, and money transfer services are as safe as PayPal and bank transfers.
Tax Regulations in Canada
The Canadian tax law doesn’t require paying gift or income tax when receiving money from friends and family from another country. However, that doesn’t apply to getting money for selling a product or providing a service. These kinds of transfers are considered capital gains, for which the receiver will have to pay taxes. Receivers are also advised to report large transfers to see if there are any applicable taxes. Senders, on the other hand, usually don’t have to pay any taxes when transferring funds to Canada.