MoneyGram Fees: What’s the price of a money transfer?

MoneyGram has 350,000 agent locations all over the globe, as well as an online presence. If you’re thinking of making an international payment or remittance, you’ve probably heard of them. MoneyGram allows customers to make payments online or in person, and receive their money either directly into an account or in cash. There are different rates and fees available for these services, and exactly which options are available to you will depend a bit on where you and your recipient are in the world.

This article covers the MoneyGram process, how much a transfer may cost, including fees for sending money, and exchange rate markups. We will also cover a different service for online international payments direct to bank accounts - Wise. If you’re planning on making an international bank transfer to a friend or family member, or even for your business, it’s worth checking out alternatives to MoneyGram, including the Wise borderless account to see if there’s a better deal out there. Let’s dive in.

Who are MoneyGram?

MoneyGram is a global company offering international transfers and remittances. Depending on where you are in the world, you can send money online, or in person via a MoneyGram agent. Your recipient can then either have their money paid into their bank account or mobile wallet, or they can collect it in cash from a local agent¹.

What are the fees for sending money internationally?

There’s a cost estimator tool on the MoneyGram website, which allows you to model the payment you want to make and see the options and fees. It’s worth looking at the costs of the different services available to you, to compare them - the exchange rates and fees applied to sending money online can vary significantly from those offered for payments made at an agent location, for example.

Here are some example fees to consider²:

If you’re sending your money to a bank account rather than for collection, it’s worth checking if it will be processed using the SWIFT network. This is a common way to move money from one account to another, and involves several banks passing the payment along to make sure it reaches the right destination. These intermediary banks may charge a fee for processing the transaction, which can mean your recipient gets less than you expect them to in the end.

Here’s what the MoneyGram terms and conditions say about these potential extra charges³:

“Fees imposed by your financial institution or by any other person not directly a party to the Transfer, such as the Recipient’s financial institution, will not be reflected on the breakdown of costs provided to you for your Transfer.”

Unfortunately, this means that, if SWIFT fees are deducted from your payment, you won’t know about it in advance.

Not all international payment services use the SWIFT network. Wise, for example, use a different approach to cross border payments, which avoids SWIFT for most transactions, and cuts out many of the normal international payment costs. If you’re looking to make a payment directly to a foreign bank account, you might find that the Wise borderless account is a good way to save time and money. You can keep your money in any of over 40 currencies, and make and receive secure, low cost payments using an app. There’s just a small upfront charge to exchange money, which is often cheaper than using a bank or another payment provider, with no hidden fees to worry about.

What exchange rate is used by MoneyGram when converting your funds?

When you model your payment using the MoneyGram cost estimator, you’ll choose how much to send, the currency you want to use, and the destination. You’ll aso enter details of how you want to pay for the transfer, and how your recipient should collect the money. This will then give you a cost, including the fee and exchange rate which will be used to convert your payment.

It’s important to check the exchange rate which will be used. A poor exchange rate can push up the costs and mean your transfer is more expensive than it needs to be. The MoneyGram exchange rate can vary depending on the way you arrange the transfer - rates offered online may not be the same as those available at agent locations³.

Compare the rate you’re being offered with the mid-market exchange rate. This is a good benchmark because it’s the rate banks and currency exchange services use to buy foreign currencies themselves. However, many services will then add a markup to the exchange rate they give to their customers, which they then keep as profit in addition to the upfront fees paid.

Not all services add a markup to the mid-market exchange rate. Wise pass on this rate to their customers, and simply charge a low transparent fee for exchange services. This makes it easy to see the true cost of your transaction, and can also mean it’s cheaper.

What is the real cost of transferring money with MoneyGram?

To help you decide if MoneyGram is the right service for you, we’ve modeled an example payment, and included a comparison to an alternative service. Let’s say you need to send AUD1,000 to your sister in London. She wants to receive it in pounds, into her local bank account in the UK.

Here’s what you’ll pay for the service²:

Exchange rates and fees correct as of 24 April 2019

As you can see, it’s well worth comparing options before you select which service is right for your international payment. Looking carefully at the impact of both the fees and the exchange rate used can mean you get a better deal. Don’t forget to check out the Wise borderless account for a simple, quick and cheap way to manage your money across multiple currencies, and send and receive payments all over the world.

Source:

All sources accurate as of 23 April 2019