Broadly speaking, any payment of an invoice or a bill can be called a remittance. However, the term is most often used nowadays to describe a sum of money sent by someone working abroad to his or her family back home. The term is derived from the word remit, which means to send back.
What is meant by remittance in banking?
A remittance is a transfer of funds. A cash remittance is when the sender deposits cash instead of using a debit or credit card, cheque, or direct bank transfer to remit. For a cash remittance to a bank account, the sender needs to provide the beneficiary’s full name, bank account details, including SWIFT code.
What does it mean to send a remittance?
At its core, a remittance (sometimes called a remit for short) is just a fancy way of saying “international money transfer” or sending currency payments across national borders. Generally speaking, remits are sent out in the form of wire transfers, digital transactions, debit/credit payments, or bank drafts.
Which is better wire transfer or bank remittance?
However, international wire transfers are more reliable. A bank transfer is when you send a certain amount from one account to another. A bank remittance is used when a transfer is made between two different accounts. While wire transfers are always popular, a prime alternative is online transfers.
How is the amount of remittances reported to the government?
The methodology countries use to record the amount of money people receive via remittances is rarely made public. While the majority of value transfers occur via web or wire transfers where they can be more easily accounted for, a fair amount of money is transferred in ways that are more opaque.
What are the charges for inward remittance from one country to another?
Charges for inward remittances vary. The costs depend on factors such as the prevailing currency exchange rate, correspondent bank charges, type of transfer, the type of account, country from which the remittance is being made etc. However, your bank will inform you about the estimated charges before you complete your transaction.
