Money transfer vs. cash pickup: how should you send money overseas?

When sending money internationally, make sure to pick the method that suits you and your recipient.

Xe Consumer

October 22, 2020 5 min read

Person using British currency

If you look for ways to send money overseas, you’ll see that you have quite a few options out there. Ultimately, the end result will be the same—money from your bank account in your country will be sent to someone in another country—but depending on the method you choose, there could be a big difference in how much you spend, how much your recipient gets, and how convenient it is.

While some people prefer the ease of a money transfer directly into their bank accounts, others would prefer to have the physical cash in their wallets. This leads us into today’s comparison: is it better to utilize a money transfer between bank accounts, or should you send your recipient a cash pickup so they’ll have the currency on hand? The answer depends on what you’re looking for.

What’s the difference?

Well, we think the answer should be pretty clear from the names. But, in short:

  • Cash pickup is a form of international transfer in which your recipient picks up the money in cash, in person at a physical storefront.

  • Money transfer does not have any physical money involved. Instead, information is securely transmitted between banks, resulting in the sender’s account being debited and the recipient’s account being credited for that amount. The money arrives directly in the recipient’s bank account.

Both methods have a fairly similar initiation process. While some providers will ask you to initiate the transfer in person, most providers will allow you to provide the information for the transfer online. Once it comes time for your recipient to get their money is where the two diverge.

When would you want cash pickup?

One advantage of cash pickup is that some providers allow you to bring in cash for your transfer, meaning that you can make an international transfer without a bank account. If you’re in a country where you don’t have a local bank account or you’d prefer to just make a quick transfer with the cash you already have, this can be a convenient option.

They also tend to be pretty quick, because they don’t involve multiple bank accounts in their transfers. Depending on where you’re sending money to and from, your recipient could get their money in just a few minutes.

Your recipient may also want the convenience of having the cash on hand. If they need the money to make a cash payment or just prefer to have cash on hand, cash pickups will let them quickly get the money in cash, taking away the extra steps of withdrawing or converting the money to the local currency.

Why might cash pickup NOT be the best option for you?

It’s true, cash pickups are quick and convenient. However, they may not be the best option as far as costs go. In general, cash pickup transfers come with higher transfer fees than bank-to-bank money transfers, and you may not always be aware of all of the fees before you hand over your cash for the transfer.

Additional costs can come from the exchange rates. Cash pickup providers can set their own exchange rates, and the rates on cash transfers can be less favorable than the rates provided by other money transfer providers. Before opting for the first provider that you find, make sure to double-check the rates offered by other providers at the same time. You could be surprised by what you find!

Depending on where you’re sending the money, you may also want to consider the safety aspect, particularly if you’re also sending a large amount of money. Carrying cash is not always safe, and could put your recipient at risk for theft. If they’re in an area where pickpocketing, theft and other crimes are common, it may be safer to transfer a larger amount into their bank account, and only withdraw what’s needed.

The benefits of using Xe for your international money transfers

At Xe, we do not currently offer cash pickup options for our money transfers. However, we do offer quick, easy and secure money transfers to over 130 countries around the world

  • Quick. Initiating a transfer is quick, and so is the actual transfer process. The majority of our money transfers are complete within 24 hours, with several countries able to receive their money in minutes.

  • Simple. Opening an account and initiating a transfer with Xe are both quick and easy, and can be done in just a few minutes. If you run into any trouble, our customer service team is there to assist.

  • Secure. We adhere to regulatory standards in every country that we do business in, and ensure that our security is enterprise-grade in order to protect the money and information of our customers.

  • Varied. While we do not have cash pickups, we do offer a variety of money transfer options to suit a range of needs. These include forward contracts, market orders, and Regular Payments Abroad (RPA). We also allow you to set up Rate Alerts to let you know the best time for future transfers.

In short…

Both cash pickups and bank-to-bank money transfers are quick, easy, and secure ways to send money to someone in another country. When deciding on which method is the right one for you, consider:

  1. Where you’re sending the money

  2. When your recipient needs it

  3. How your recipient would prefer to have their money.

If you’re interested in sending a money transfer to your recipient’s bank account, we’d love to help you with that process. Log in or sign up to get started!