Remittance refers to receiving/sending money abroad, often to support family or friends. It plays a crucial role in the global economy. If you've ever had to receive/send money from/to family or friends abroad, then you've engaged in a remittance transaction.
Understanding the meaning of remittance
The term remittance comes from "remit," meaning to receive/send money, usually across borders. In finance, it refers to transferring funds from one person to another, often when someone abroad sends part of their earnings back home.
Remittances are vital for supporting families, particularly in developing countries, where they help sustain household economies. Typically sent through banks, money transfer services or online platforms, remittances can be one-time or recurring transactions.
The importance of remittance
Remittances play a pivotal role by serving as a significant source of foreign exchange and supporting millions of households. These funds, often sent by Indians working abroad, directly contribute to improving living standards by financing essentials like education, healthcare and housing.
Remittances also boost consumer spending, which stimulates local businesses and drives economic growth. Additionally, the influx of foreign currency strengthens India's financial reserves, helping to stabilise the economy and reduce the reliance on external debt.
How to send a remittance
1. Select a bank or a reliable money transfer service. Ensure they offer competitive exchange rates and low fees.
2. You will need the recipient's bank details, including their account number, SWIFT / BIC code (for international transfers) and the bank's name and address.
3. Be mindful of the exchange rate and any associated fees, as these will affect the total amount received.
4. Fill out the required forms or online fields with the correct information. Double-check all details before confirming the transaction.
5. Most banks and transfer services provide tracking numbers or online portals where you can monitor the status of your remittance.
Benefits of remittances
- Financial stability: Remittances provide families with a steady income.
- Convenience: Modern banking makes international money transfers quick and easy.
- Cost-effective: Competitive rates and low fees ensure more money reaches loved ones.
- Global connectivity: Remittances maintain family ties across distances.
- Economic empowerment: They enable recipients to improve living standards and invest in education.
Also Read: Best ways to transfer money to India
Conclusion
Understanding remittance goes beyond just transferring money. It's about the significant impact it has on economy. Whether you're helping family abroad or managing finances, remittances play a important role in empowering individuals and strengthening economies.
With services like Axis Bank's International Fund Transfer, you can easily send money abroad through multiple convenient channels, such as Internet Banking or the Axis Bank mobile app, making it a seamless experience. This reliable and efficient service allows you to support your loved ones and manage your finances.
FAQs
What are the fees associated with remittances?
Remittance fees vary by transfer method, service provider and destination country. Banks and money transfer services may charge a flat fee, a percentage of the amount or both. Exchange rates also impact costs. Comparing providers helps you find the most cost-effective option.
How long does it take for a remittance to be processed?
Remittance processing times vary by service, ranging from a few minutes to several days. Bank transfers typically take 1-5 business days, while some online services offer instant or same-day options. Factors like the destination's banking system and intermediary banks can also affect speed.
How can I track my remittance?
Most banks and transfer services offer remittance tracking via a reference number. Use this code to monitor your transfer online or through customer service.
Disclaimer: This article is for information purpose only. The views expressed in this article are personal and do not necessarily constitute the views of Axis Bank Ltd. and its employees. Axis Bank Ltd. and/or the author shall not be responsible for any direct / indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information. Please consult your financial advisor before making any financial decision.
