The challenges of international banking — and how to overcome them

A note: Please kindly note that Cenoa does not provide investment, tax, legal or accounting advice; and this material has been prepared for informational purposes only. You should consult your own advisors before engaging in any transaction. You can find detailed disclaimers on Cenoa’s website. 

There are many reasons why someone might need to start sending money internationally. 

Many immigrants often leave their countries to seek out greater stability and opportunities, and once established they can share their income with their family and friends back home. Others move to another country for a short period of change and adventure — but they don’t always realize that banking internationally in order to access their money back home can be an adventure of its own. 

Kwan Fung // Unsplash

And the pandemic — and its impact on the world of work — showed that many industries can accommodate remote work, so companies and agencies have had to figure out how to pay employees, contractors, freelancers, and collaborators across borders.

We’ll get into the hurdles that many people face when sending money overseas, and what kinds of options are available for international banking. 

International banking challenges

Fees

There’s no discussing cross-border banking without mentioning fees. Whether it’s a dollar amount for a wire transfer, a percentage taken by a transfer service, or an unfavorable exchange rate making money go less far, there are tons of ways that people lose money when sending it abroad. 

Complex taxes

Every country has its own tax rules, and they can sometimes be in contradiction with the laws in other countries around the world. Any kind of international banking requires knowledge of the tax systems of the countries you’re living or working in, and sending money to — so consult with a knowledgeable cross-border accountant or lawyer to ensure you and your business stay compliant and avoid penalties. 

Delays in transfers

Many countries have banks that facilitate instant transfers through apps, online banking, or in-person visits to the bank. But those instant options tend to dry up when there’s a border involved — many international banking options can only make transfers that take days, or longer, to arrive in the recipient’s account. 

International banking options

Local banks

Many local banks allow members to send funds internationally through wire transfers, but they typically charge fees or use unfavorable exchange rates. 

International banks

Major banks sometimes have accords with neighboring countries and create accounts that receive benefits when sending money between some countries, including lower fees, more transactions per month, or quicker transfers. These borderless accounts can be a great option, but are not available everywhere in the world. 

PayPal

PayPal’s online transfer service covers much of the world, allowing people everywhere to send money back home, pay freelancers, or make international purchases. However, PayPal charges fees for some types of transactions, including instant or international transactions with currency conversions. 

Money transfer services like Ria, Western Union, or Wise

Western Union, Ria, and Wise are all popular options for sending money abroad, but they also make money either through consumer fees or by setting their own exchange rates — that don’t always benefit the sender. When using a money transfer service internationally, always compare the exchange rates they’re offering with the standard exchange rate between your two currencies. Read the fine print about fees, whether they’re charged in dollar amounts or in percentages, and ensure you won’t lose too much money. 

Priscilla Du Perez // Unsplash

DeFi wallets like Cenoa

Cenoa is a DeFi super wallet that offers a free, international instant dollar transfer service. It’s a great way to send funds internationally, instantly, with no fees ever — available in 50+ countries. It’s built on the blockchain, so transactions are private and encrypted. And while you hold funds in your Cenoa wallet, they grow steadily with an impressive 5% yield. 

Need to send funds internationally? Cenoa can help

For individuals sending money across borders, or for businesses paying contractors in other countries, Cenoa’s instant dollar transfer service is a safe, quick, and free way to send funds. Learn more about Cenoa, and start sending funds today.