How to Send Money to and from a Debit Card
Debit cards have been a prominent method of sending money abroad and domestically along with bank transfers, credit cards, and other payment methods. It is now possible not only to pay your transfers with a debit card but make payments directly to someone else’s debit card. Here’s everything you need to know about how to send money in this way.
How to Send Money to a Debit Card
Even though direct debit deposit as a service is uncommon, there are ways to have your transfer available for your beneficiary to access through a debit card. Here’s a step-by-step guide on how to send money to a debit card.
Step 1: Find a service that supports debit card deposits
Step 2: Make sure your recipient’s debit card accepts payments
Step 3: Enter your recipient’s details
Step 4: Choose your payment method and complete the transfer
How Much Does It Cost to Send Money Abroad Using a Debit Card?
While it’s still cheaper than using a credit card, debit card payments are not typically among the cheapest ways to send money. Here’s a rundown of the costs involved with debit card transfers.
Moving funds will incur transfer fees from either remittance companies or banks. Depending on the provider, these can be flat or variable fees or a combination of both. They may depend on the transfer sum, origin and destination countries, and payment/deposit methods.
However, there are some money transfer providers like VertoFX that don’t charge any transfer fees.
Varying processing fees are the biggest driver of high debit card payment fees. They may come in addition to the transfer fees and depending on the service you choose, the charges range between 0.7% to 2%. While for some services the fee remains the same irrespective of the amount, others like Xe Money Transfer may add differing markups depending on how large your transfer is.
Regardless of the payment or deposit method, almost all senders are charged a currency conversion fee for their international transfers. This charge is added on top of the mid-market rate, at which banks trade between each other, and can be anywhere between 0.1% to 5%. High street banks have notoriously poor exchange rates, whereas remittance companies keep their margins as low as possible. Wise, for example, allow customers to convert at the mid-market rate for the majority of the currency pairs they support.
Best Ways to Instantly Transfer Money to a Debit Card
Many people ask themselves how to send money instantly. In this case, we will cover some of the quickest ways if you're transferring money to a debit card.
Here’s a rundown of services allowing sending money to your recipient’s debit card quickly.
Money Transfer Service
Money transfer services, also known as remittance companies, have improved their services exponentially in recent years. They typically provide the most affordable and flexible means of transferring money abroad, with a range of payment and deposit options, low fees, and favorable exchange rates. These types of services are predominantly digital-only, which may come across as unsafe or unreliable to many, but are regulated by leading institutions like Consumer Financial Protection Bureau and usually have a comprehensive customer support system to walk payees through the process.
WorldRemit does not display all of its costs upfront, which depends on the amount, payment/delivery methods, and the currency pairs. The only way to transfer funds to the recipient’s debit card is by bank transfer, which typically makes for the cheapest form of transfer with flat fees starting from USD 1.99. WorldRemit also has a large network of banks across the worlds, helping their customers avoid unexpected third-party fees.
To send money to a beneficiary’s debit card abroad, senders need to have an account with WorldRemit. It's advisable to verify the account before transfer, as the provider may request further information and it may cause some delays.
Senders can then fill in the required details and choose a bank transfer for the beneficiary to access the funds via their debit card. These details would include the recipient’s banking information, such as the account number or SWIFT code. Check the fees the provider incurs, and if happy with the terms, choose a payment method. Senders can fund their transfer via bank transfer, Apple Pay, or credit/debit card — note that the chosen method will affect the overall fee.
Bank transfers are directly deposited to the beneficiary’s account, so the recipient doesn’t have to do anything to receive their funds. Once they are deposited, which can take up to 3 days, they can start using the money through their connected debit card. The company notes that 90% of transfers are settled within the same day.
Xe Money Transfer
Xe Money Transfer is one of the low-cost options to transfer money abroad. Its flat fees depend on the amount and method of payment, and senders can send money to their beneficiary’s debit card via bank transfer. The provider has scrapped flat fees from US-originating transfers, but there are some additional charges for debit and credit card payments. It maintains competitive exchange rates which vary between 0.4%-1.2%.
Senders can get a quote for their transfers via Xe’s calculator, and compare their rates by switching to the convert tab on the website. The company has one of the most reputable mid-market rate trackers. If happy with the terms, first-time senders can set up a free account and validate their identities with a government-issued photo ID. Note that depending on the amount, Xe may require further documentation regarding the source of funds.
Senders then can begin filling in the details of their transfer. To deposit the money to the beneficiary’s debit card, they would require the bank account details the card is connected to, including the account number and SWIFT code. Senders then can choose a payment method, which includes bank transfers and credit/debit card payments and complete their transfer. The beneficiary may receive the money between 1-3 business days, but note that Xe is notorious for delayed payments. Once the money is deposited into their bank account, the recipients can begin using it via the debit card connected to the account.
Wise has a very transparent fee structure with no hidden costs. The provider uses the mid-market rate for currency conversions, which is locked for a couple of hours while making the transfer and displays a breakdown of all costs involved prior to transfer. Its variable fee starts from 0.41% while its fixed fee can be as low as USD 0.28. Both types of fees depend on the currencies involved and payment options.
Senders can deposit their transfer to the beneficiary’s debit card via bank transfer, which is the only deposit method Wise supports. Before starting a transfer, senders can get a breakdown of the costs with Wise’s calculator, and if happy with the terms, sign up for a free account. First-time users can verify their accounts with a government-issued photo ID in most cases, and begin making transfers thereafter.
After submitting the recipient’s account details, choose a payment method. Wise offers a variety of payment methods, including Google and Apple Pay, bank transfers, and credit/debit cards. Note that card payments are usually the fastest option, but they are also the costliest. Bank transfers, on the other hand, are the cheapest yet slowest option and may take up to 3 days to settle. Once the funds are deposited, the beneficiary can access them via their connected debit card.
Bank and Wire Transfers
Bank and wire transfers are the most common alternatives for sending money to a debit card. While they are very convenient andsecure, they are also the costliest and slowest forms of transfers. Similarly, senders should transfer the funds to the beneficiary’s bank account to which their debit card is connected.
If the recipient is within the US, ACH transfers are mostly free, but they may take up to 3 working days and only work for domestic transfers. Wire transfers, on the other hand, are almost always settled within the same day, and support international transfers. International wiring may take up to 3 days, although same-day transfers between popular currency corridors, such as USD and MXN, are becoming more regular.
Wire transfers are one of the most expensive options to send money both domestically and globally. Domestic fees may take between USD 15-30, while outbound international wiring can go up to USD 50 depending on your bank.
Difference between wire transfers and direct deposits
Most banks allow transfers via their phone service, either through a representative or automated recording. In terms of cost and delivery times, the same terms apply to your transfers. Similarly, you can transfer the funds to the recipient’s bank account that is connected to their debit card, and fund the transfer through your bank account. It’s a popular method for those who are not tech-savvy, as it’s generally hassle-free and guided.
Some currency brokers, like TorFX, also offer phone services. Senders can arrange their transfer, secure an exchange rate, and pay over the phone as an account manager or broker walks them through the process. Likewise, the same rates apply as with online transfers.
It’s also possible to send money to someone’s debit card by visiting a physical branch of your service provider. While most legacy banks have branches, some remittance companies, including Western Union, MoneyGram, or Ria Money Transfer, also have brick-and-mortar stores spread across the country.
In-branch transfers are generally faster than paying via online or phone services as senders have the option to pay in cash or make instant card payments. Depending on the availability, senders can send the funds to the beneficiary’s bank account to which their debit card is connected, or choose debit deposit and send the money directly to their debit card. Depending on the transfer sum and currencies involved, these services typically take up to 3-5 business days.
While banks may charge up to USD 50 for international and USD 30 for domestic transfers, remittance companies may offer far more competitive costs.
Money Transfer Apps and PayPal
Money transfer apps are yet another convenient way to transfer funds both domestically and internationally while on the go. Most apps allow sending money to someone’s debit card by bank transfer. Senders can move funds to their beneficiary’s bank account to which their debit card is connected to. Some services, like Remitly, also allow direct debit deposit, which allows the funds to be accessible by a debit card more quickly.
Transfer apps are usually a more affordable and quicker option to send money abroad – domestically and globally. While the costs of remittance companies such as Remitly or Xoom vary based on a range of factors, they tend to go up to a maximum of 5% coupled with favorable exchange rates.
Domestic transfers, on the other hand, are mostly free-of-charge and almost instantaneous. PayPal, for example, runs all domestic transfers without additional charges and completes them within seconds. Although its international transfers can incur a cost of up to 6% along with poor exchange rates with profit margins of up to 5%. Wildly popular Venmo charges 1.7% with a maximum fee of USD 25 to all US-based debit cards within half hour of completion. Both services also offer a native wallet, in which users can store their money and make payments directly through their balances.
How to Send Money From a Debit Card
Senders can fund their transfers via debit card payment with many remittance companies. Debit card payments are quite quick with most payments being processed in a few minutes. However, the rapid transfers come with a high cost, as processing fees can be up to 5% for debit card payments. For this reason, they make the more suitable choice for your urgent transfers. For less urgent transfers, companies will typically offer a bank transfer option with which users can transfer the money from the same account the debit card is connected to for a fraction of the cost, but it will take significantly longer (up to 5 days) than a debit card payment.
Debit card payments don’t depend on the deposit option. With remittance companies, the recipient doesn’t even have to have a bank account. Senders can pay for their transfers via a debit card and have it delivered to the recipient by cash collection, home delivery, or mobile money.
While it varies by bank, debit card payments also typically have low transfer limits, with an average of USD 5,000 per day. With low limits and high processing fees, it’s not the most suitable option for moving large sums around.
Should You Use a Debit Card for International Money Transfers?
Card payments have obvious advantages over bank transfers. With speed the most important. And while both credit and debit card payments are costlier than transferring through your account, the latter has cheaper processing fees, while the former allows senders to pay for it at a later date. All transfer methods involving a bank account are less accessible than cash transfers, but they provide strong security. Here’s a rundown of the advantages and disadvantages of using a debit card for international payments.
Pros and cons of using a Debit Card for International Money Transfers
Cheaper than credit cards
Low payment limits
Must have a checking account
Funds are withdrawn immediately
Long refund waiting times
How to Send Money Online Without a Debit Card?
It’s possible to fund your transfer without a debit card. Depending on the availability, senders may fund their transfers via bank transfer, regardless of whether it has a debit card or not. While it varies by bank, it is also possible to link the savings account to your checking account and set an external transfer, which allows moving funds from your savings account.
Alternatively, you can look for services where you can pay for your transfer with a credit card. While it’s the more expensive option, it is as quick and almost as widespread as debit card payments. Some digital wallets also allow money transfers via credit card. You can add money to your balance with your credit card and make your transfers from there.
Common Issues to Avoid When Sending Money to a Debit Card
There are certain pitfalls to avoid while making transfers to a debit card, which can help minimize the costs, and avoid fraud and rejected payments.
Avoid Unregulated Money Transfer Providers
Always check the credentials of a given service before making any payments. All services listed here are regulated by the likes of the Consumer Financial Protection Bureau (CFPB) or Financial Conduct Authority (FCA). The latter is the UK’s financial regulator and they cover e-money firms and their duties to customers.
Choose Your Service Wisely
It is important to choose a service most suited for your individual needs. Some services, like MoneyGram or Remitly, offer debit deposits, which means you can deposit your transfer to your beneficiary’s debit card directly using the debit card number on the card. These services are limited, but sending money to your beneficiary’s bank account with a debit card serves the same purpose and is more widely available.
Bank transfers as a delivery method are usually very cheap. To avoid processing fees you may want to opt for a bank transfer for your payment method.
Triple Check Your Details and Funds Available
Errors due to incorrect details or insufficient funds are frustrating, time-consuming, and in some cases disastrous. If you make a mistake in submitting your beneficiary’s account information and somehow send the money to the wrong account, you may have to contact your service provider to cancel the transfer, which is only possible within a small window of time.