What Do You Mean By The Term ‘remittance’?

By Author: Shashank Bhaskar
Total Articles: 63
Comment this article

When you live and work overseas, you might often need to send part of your income to your family living in India to maintain their financial upkeep. Similarly, when travelling abroad for business or if you have a child who studies overseas, you may need to send money from India to cover the expenses.
In such a case, knowing about remittance becomes essential. However, if you are unaware of such a term or are new to this, the following guide might provide a better understanding.
What is remittance?
The word ‘remittance’ indicates the process of sending money from one party to another. However, this term usually refers to transferring funds abroad, i.e., from one country to another. It ensures the economic security of your loved ones living in a foreign country while you are based in another.
Types of remittances
Remittances can be of the following two types:

Outward remittance

When you carry out an online money transfer and send ...
... funds abroad from your account in India, it is classified as an outward remittance. For example, when you live in India and carry out an online transfer of funds to a child living or studying overseas, the money transfer is an outward remittance for you.

Inwards remittance

When you receive any funds in your account from abroad, it becomes an inward remittance. So, suppose you are a Non-Resident Indian or NRI living in the United States of America and send money to a local Savings Account in India. In that case, the money transfer is referred to as inward remittance.
How to send money overseas?
If you want a remittance service to send money overseas, you can conveniently opt for any of the following payment methods:

Bank transfer

A bank transfer refers to the method of sending money from one bank to the other. It uses the communication system that exists between the two banks. This method is reliable and quick. Based on the participating banks, the transaction might take a few hours to some days to be completed. Using this payment method, you can send money from a Debit Card, Credit Card, Bank Account, etc.

Wire transfer

Wire transfers are widely popular when sending money abroad. In this method, payment is made from one bank to another with the help of SWIFT. This method usually takes three to five business days. It may also take longer. This payment method is typically quite expensive.

Transfer through apps

The spread of technology has resulted in several apps that let you carry out faster international money transfers. So, if you want to send money abroad to care for your loved ones, pay for medical treatment overseas, etc., you can use an International Money Transfer app. Sending money using money transfer apps is convenient, secure, and relatively easy.
While it is convenient to transfer money abroad, ensure you check the foreign exchange rate, charges involved, and other relevant details before sending funds