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At the heart of sending money overseas and across borders is the concept of remittances—fast and traceable international money transfers. The question “What is a remittance?” arises for many when navigating international transactions, family support, or global business needs.
As digital wallets and finance platforms evolve, so does the meaning of remittance, expanding beyond traditional transfers to broader interactions. Today’s remittances use a network of automated payments, mobile apps, and real-time currency exchanges, transforming how money flows between individuals and countries.
This article will explore what remittances are, how to send one, and what their evolution means for everyday financial habits.
Table of contents
A remittance is a financial transfer made from one party to another, often across borders or geographical locations. The term typically refers to:
In modern finance, the meaning of remittance payment has evolved to include both international and domestic money transfers made through digital platforms, banks, or fintech apps.
Remittances typically work by following a straightforward process:
Currency exchange rates, fees, and delivery speeds can vary based on the method and destination, but modern platforms help simplify the experience with automation, real-time tracking, and mobile accessibility.
There are several ways to send a remittance, but it typically depends on the recipient’s location, preferred currency, and how they plan to use the funds. From traditional wire and bank transfers to digital remittance services, below are six of the most common ways to send remittances.
Traditional money transfer operators (MTOs), or financial services companies specializing in transferring money between individuals, are a tried and trusted option for sending remittances, especially to regions that lack access to traditional banks.
The key aspects of MTOs are:
Money transfer operators are common for sending money as a gift or providing urgent financial support in areas with little to no digital access.
A bank transfer, which is an electronic payment method that allows users to move money from one account to another, can be a secure remittance option, particularly for large or business-related transactions. Individuals can use wire transfers to send money across international borders, though these may take several days to process, depending on:
For domestic needs, customers can transfer money between banks using online banking platforms, though fees and processing times can vary.
Online money transfer services like PayPal offer fast, user-friendly ways to send funds internationally or domestically. They support transfers via debit and credit cards, bank accounts, or Automated Clearing House (ACH), often providing real-time tracking and transparent fees.
These services are especially appealing for those seeking instant money transfers, as many offer near-immediate delivery. They’re ideal for everything from personal remittances to one-off payments for goods or services, combining convenience with digital-first functionality.
In regions with limited banking infrastructure but widespread mobile usage, mobile money transfer services can support digital remittances. International money transfer apps help bridge financial gaps by enabling users to access and manage funds securely, even in remote areas.
These platforms can also help users send and receive funds using a mobile device, often without requiring a formal bank account.
Cryptocurrencies and other types of digital currency have introduced a decentralized way to send remittances globally.1 These forms of payment help enable peer-to-peer (P2P) transactions without traditional banking intermediaries.
Important considerations for crypto remittances:
Crypto’s unpredictability may mean that this form of remittance payment may not suit every case.
Electronic funds transfer (EFT) encompasses many digital and secure payment methods beyond banks and apps, including direct deposit, electronic bill pay, and recurring ACH payments. People commonly use these tools to make domestic and international payments, like:
While they may not offer the immediacy of app-based transfers, EFT methods are highly reliable for scheduled or recurring remittances and often integrate easily into broader financial planning systems.
Remittances typically cost around 6% of the transaction, but fees can vary widely.2 Traditional providers and digital platforms charge unique fees based on:
Those who regularly send money abroad can take steps to save money on international transfer fees by comparing providers, using apps that offer favorable exchange rates, or scheduling transfers in advance. Plus, being aware of the upfront costs and hidden charges can help ensure senders are prepared to pay the fees.
Using a digital wallet or other fintech platform can make cross-border transfers more accessible than ever. Understanding what a remittance is and managing international payments no longer requires a traditional bank.
Platforms like PayPal allow users to send payments in approximately 200 markets and 140 currencies, providing convenience while helping to streamline personal and professional global money transfers.3
Learn how to take advantage of secure transfer methods when sending money internationally with PayPal.
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