Last year, more than $120 billion was sent by U.S. residents to their families and friends abroad, with India, China, the Philippines, Mexico and Nigeria leading the pack as top 5 recipient countries. And over the years, the options for sending remittances to the Philippines and beyond have greatly expanded to include online and mobile transfers, with the costs slowly declining.
With so many options available, it becomes more and more difficult to compare money remittances services, understand the fine print, and decipher the hidden fees. In February 2013, the Consumer Financial Protection Bureau (CFPB) issued a new directive requiring money-transfer services to provide prepayment disclosure of exchange rates, the amount of foreign currency to be delivered, transfer fees and taxes, as well as transaction cancellation rights.
In a statement issued by CFPB director, Richard Cordray, he says, “With these new protections, international money transfers will be more reliable. Consumers will know the costs ahead of time and be able to compare prices. Transfer providers will also be held accountable for errors that occur in the process.”
The new International Remittance Transfer Rule serves to protect customers who send money electronically to foreign countries and help them understand the true cost of sending money. Up until this new regulation, Federal consumer protection rules did not apply to most of these money transfers. But Buyer Beware: The rules do not apply to companies that consistently provide 100 or fewer remittance transfers each year.
In deciding what service to use to send your hard-earned money to your loved ones in the Philippines, here are 6 things to consider in arriving at your choice.