Remittances play a huge role in our current financial ecosystem, and you’re probably using one without even knowing it. In an increasingly connected world, more and more people are sending money to their families for a livelihood.
Remittance, broadly defined, can be any payment from an invoice or bill, but the term is used more often by those working overseas.
What is a discount service?
A remittance service is any service specializing in international money transfers. Companies like Western Union, Wise, and Remitly are responsible for the majority of payment transfers.
Clients who use remittance services are typically migrants living in Canada, the United States and the United Kingdom who send part of their income to support their families.
If the use of a money transfer service is technically impossible for employees and unreliable for foreign employees, the self-employed can use a pay stub Creator to create and send their paychecks abroad. Money transfer services charge a fee per wire transfer.
How can an employer use a remittance service?
Employers will need to register with the money transfer service provider of their choice, online or in person. The front page of Wise is incredibly user-friendly and provides information about the currency you want to use, the conversion rate, and the total fees you will incur depending on the payment method.
All websites will ask you to sign up with your email and enter your personal banking information and recipients. Follow the instructions on the page to send funds overseas.
International employers who hire freelancers and freelance contractors in another country can use a money transfer service instead of a bank or e-wallet, like PayPal.
Is it legal?
Fund transfers are legal. In fact, under federal law, these services have a legal precedent to provide you with up-to-date information about a country’s exchange rate, fees, and foreign taxes.
Money transfer services should also offer their customers an encrypted and secure way to transfer funds, information on when the money will be available and the right to cancel. Most services give you around 30 minutes to cancel and endless time to file a complaint.
What are the advantages of using a money transfer service?
One of the main advantages of using a money transfer service has nothing to do with business directly. Remittances are a essential source of income for millions of families, most of whom are low-income and have few employment opportunities unless they move.
As one of the earliest financial products used by low-income people, remittances serve as a springboard for acquiring a wide range of financial products and services, such as loans or mortgages.
Anyone who uses these services benefits the international community, which strives to dramatically reduce transfer fees and costs. Employers will also benefit from the following benefits:
- Reduced transfer fees, sometimes up to $ 10- $ 30.
- Instant to near instant money transfers, ranging from 24 hours to 7 days.
- Access to several payment options that are not available at traditional banks.
- Higher transaction limits (example: Wise has a limit of $ 250,000 per translation per day).
- Improves convenience for money senders and their families.
- No deduction from paychecks as the sender must prepay.
Employees who receive their money immediately are less likely to go into debt by taking out high-interest loans to pay for their needs. If an employee does not have access to a bank account, employers can transfer paychecks to electronic wallets, credit cards, or directly to an invoice.
Using a money transfer service is easy to use, convenient, and costs less than bank transfers. If you are an employee who wants to be paid this way, let them know! They will be sure to get on board once you have explained all the advantages offered by this service.