International payment fees explained for Indians

Imagine a client sends you $100 for a task, but you end up receiving $98. You might start wondering where the missing $2 went. It is even worse when you are sending money. You could send $100, and find out $105 left your account. So, where is the extra $5 deduction coming from? If you’ve ever made an international transaction, then you can probably relate to these scenarios.

Whether you’re a freelancer managing international clients, an international student paying tuition abroad, or you’re sending remittances to your loved ones, you have to deal with international payment fees. Cross-border payments often come with several fees that can be annoying if not understood properly. This article aims to break down international payment fees for Indians and how to avoid exorbitant fees.

Also read: How remote workers in India can switch from traditional banks to Grey

Types of fees in international transactions

International payments usually incur various fees. Depending on your choice of payment solution, sometimes these fees are hidden or not immediately apparent. Sometimes, multiple financial institutions, including intermediaries, handle the transactions and charge extra fees. Here are some charges that might apply during an international transaction:

• Transaction fees: This is usually a flat charge for processing the transaction.
• Intermediary bank fees: When money moves through several banks before reaching the recipient, each intermediary may deduct a small fee. In SWIFT transfers, correspondent banks may deduct USD 10-30 per transaction, which is often passed on to the sender or receiver.
• Currency conversion fees: This is the charge incurred for currency exchange.
• Exchange rate markups: This is the difference between the “mid-market rate” (the real exchange rate you see on Google or XE) and the rate your provider gives you.
• Receiving fees: The bank or platform receiving the funds may also charge a service fee, especially for foreign currency deposits.
• Other charges: For urgent transfers or specific currencies, additional costs may apply.

Also read: The fastest and easiest ways to send USD from India to the US

Tips to minimise costs

International transactions don’t have to cost an arm and a leg. Bank charges on foreign remittances make your loved ones receive less than they should. Here are some tips to help you minimise the costs of cross-border payments.

• Avoid payment services with hidden fees.
• Compare exchange rates to avoid unfair mark-ups.
• Check your bank’s fees and compare with other payment services.
• Digital payment services offer lower fees and better exchange rates compared to traditional banks.

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Affordable cross-border payments with Grey

International transaction fees don’t have to be overwhelming. With the right payment service, you can save money on cross-border charges. Grey lets Indians open USD, GBP, and EUR accounts, manage different currencies, and withdraw to local bank accounts. You get low fees and good exchange rates, with no hidden costs.

Open a free account on Grey today for affordable international payments.

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