Almost 30% of Singapore's population is non-resident , with migrant domestic workers making up 16% of this particular population segment. Much of these non-residents may have family overseas to whom they send back money on a regular basis.
Remittances are therefore a key service that many migrant workers rely on to support their families back home. Here, we break down why remittances are so expensive and how new players such as JiPay are working on making this more simple and affordable.
But first, what is a "remittance"?
A remittance is any payment made by someone in one country to someone else overseas. Remittances can be done through different payment methods such as:
mailing cash from the post office,
transferring funds through banks or
using money transfer services (e.g. Western Union).
Why are remittances so expensive and slow?
As a remittance is an international payment, this type of transfer often has more fees than a regular payment between banks in the same country.
In Singapore, the biggest banks charge between $25 and up to $100 for an international transfer. These fees can get so high because your bank may charge you "handling fees". These come from your bank not having a relationship with the bank that you're sending the money to, which means that your bank has to pay a middleman to transfer the money and passes on these costs to you.
Many of the money transfer services in Singapore prefer to take a commission from your international transfer by offering you a lower exchange rate than the official rate. For example, Western Union offers an exchange rate for transferring SGD to Philippine peso that is approximately 1.9% lower than the official rate. For a transfer of SGD500, this means that you are paying almost $9.50 in transfer fees.
Not only are these international payments expensive, but they can also take a lot longer than regular transfers; banks can take between 2 days and 1 week and even some money transfer services can take several working days to send your money abroad.
How new services such as JiPay Remit are changing the way you transfer
These days, you no longer have to deal with such high fees and processing times. An increasing number of electronic wire transfers are popping up online, allowing you to send money home at a fraction of the usual cost.
Long gone are the times where you were forced to accept your bank's enormous fees on international transfers. Today, you can find a range of affordable options online to transfer money abroad!
Take JiPay Remit: Regardless of the amount of money that you would like to transfer, JiPay charges you a small fixed fee! The fee varies, depending on the country you make a remittance to.
For a transfer of SGD500 to Philippine pesos, this is what JiPay charges you to send the money by bank transfer:
Service fee: $3
Even if you transferred SGD1000 to Philippine pesos, JiPay charges you:
Service fee: $3!
Not only is this option far more affordable than using your bank or a transfer service, but your international transfers now also arrive instantly when you choose to send money via bank deposit!
Avoid wasting your precious time on your off days, queuing up at your bank or paying large amounts to send money overseas. Check out JiPay Remit available on the JiPay Personal Account today!
About JiPay
JiPay is an app for everyone to manage their household expenses, no matter where they are.
It comes with a free prepaid Mastercard to do your shopping.
Click here to get the app!