Whatever the reason you need to transfer money to Nigeria, this article will give you the crucial information you need before transferring your money.
Whilst transferring money to Nigeria can be a simple process, it is nonetheless important to understand your options. There are many different factors you need to consider to decide whether any given bank or company is suited to your needs. These might include fees, exchange rates, speed, security, bank options and many more factors. Whatever the reason you need to transfer money to Nigeria, this article will give you the crucial information you need before transferring your money.
If you are planning to transfer money to Nigeria, you will almost certainly use either a bank or a remittance company. These two primary methods are vastly different, and in many cases, people misunderstand these differences. So, what are these differences?
Bank Transfers: Many people prefer to use banks because of a perception they are reliable and secure. Most people keep their money in a bank, and there seems to be little reason not to trust them if they have always kept your money safe. Additionally, major banks generally gain positive reputations through their sheer size. If, for example, you or your recipient in Nigeria uses major Nigerian banks like Access Bank Ltd, GTBank, Zenith Bank or First Bank of Nigeria Limited, you might be more likely to trust them with your international money transfers to Nigeria as well. The most common negative factor around using banks for your transfer to Nigeria, however, is fees. As we discuss in our Transfer Money Overseas from Australia blog, 12% of money spent on international money transfers worldwide does not go to the recipient.
Remittance Companies: There are many companies who specialise in remittances to countries like Nigeria, offering higher exchange rates than most banks. Additionally, these companies usually offer a faster service. However, you should be careful not to categorise all remittance companies in the same way. Whilst they are usually the more cost-effective option, it is important to remember that cost does not necessarily align directly with trustworthiness, which we will expand on later in the article.
The exchange rate between Australian Dollars (AUD) and the Nigerian Naira (NGN) generally varies from provider to provider. Some platforms offer more favourable exchange rates than others. Keep in mind that a provider with a high rate on, say, transfers in India, will not necessarily have a high rate on transfers to Nigeria. Ensure you are aware of the rate at the time you actually make your transfer. You might see a very favourable exchange rate on a platform, but make your transfer at a later time. This is because exchange rates fluctuate regularly on most platforms.
You can compare exchange rates across different platforms to get yourself the best result. But remember, the exchange rate is not the only consideration. Many platforms, like the big banks, make their money from exorbitant fees. In fact, big banks generally provide lower exchange rates as well. Generally speaking, online remittance services provide better rates.
You should also consider whether fees are flat, or based on the size of the transaction. If a company charges a flat $10 fee per transaction, no matter the size, this would be a good deal on a larger transaction, but a bad deal on a smaller one. A sliding fee – which varies depending on the size of the transaction, is more likely charged less on a smaller transfer, and more on a large transfer.
When choosing a service, it is always advisable to look beyond the immediate fee, and assess the overall cost.
Additionally, fees vary so greatly because of the nature of different platforms. Banks often have more technological limitations for overseas money transfers than more specialised international transfer services. Banks also tend to charge a mark up on the currency exchange when you transfer money to Nigeria. They can even charge fees for payment processing and extra fees for faster transfers.
Some people assume that because specialised remittance companies offer cheaper services, they are necessarily less trustworthy. Additionally, many people naturally trust the bank they already use. This is partly why banks can charge high fees. In reality, you are best to assess trustworthiness yourself.
You can read reviews and talk to individual companies to assess their level of trustworthiness. If you find a company who is transparent and honest, that is a good place to start. You can begin to assess how transparent and honest a company is with the quality of their customer service. Do they answer your questions? Are they clear about fees and exchange rates? Do they keep their promises? Are they clear about delivery methods and speeds? If the answer to these questions is “yes”, they might be a company worth considering.
But you also need them to be credible. Financial institutions are required by law to meet certain regulations. You can learn more by reading about Australia’s International Money Transfer Regulations and laws around Anti-money Laundering. Ensure the company you use has the correct licences. e-Pocket, for example, is registered with the AUSTRAC, which confirms us as an official and legitimate financial services provider.
Once you have chosen a provider you are happy with, created and verified your account, you need to gather your recipient details. It is important you provide perfectly accurate information to avoid delays and ensure your money is not sent to the wrong person. You will most likely be asked to provide your recipient’s full name, as it appears on their identification or bank account. In addition, you will also need to provide their bank details, as prompted on your chosen platform.
Mistakes in these details can result in delays, additional fees, or even the rejection of your transfer.
When transferring money to Nigeria, there are several factors to consider. By understanding the different types of transfers available, keeping an eye on exchange rates, and selecting a service with reasonable fees, you can ensure that your money reaches its destination safely and efficiently. Always remember to verify recipient details, research the transfer provider, and be aware of the fees involved to avoid unexpected surprises.
By doing your homework, you’ll ensure that your transaction is both cost-effective and reliable, making the process as smooth as possible for both you and the recipient.
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