Sending Money to the Philippines
Kia Ora!
Wow, can't believe it's literally two months today since I left the Philippines. It's been a blast so far. New Zealand has always been a magical place for me and it's still is. Although unfortunately, I haven't been to the Hobbiton set yet. Sad! But that's another story (It's a 4-hour drive from where I'm currently at and I will definitely go there someday). I am officially an OFW - an addition to a demographic that has been a sturdy foundation of the economy back home. A demographic that on a macroeconomic level, contribute a very significant 10 percent to our GDP, narrows the gap in our BoP deficits, and cushion the impact of volatile foreign currency exchanges. I may be talking pure gibberish right there because on a very personal level, each one of us just wanted to take that piece of the pie back home. To help our love ones survive, to save some and to pay debts we left behind.
That's exactly my concern in my first few days here - to find a reliable service to send money home. Wire transfer is out of the question because of its sheer impracticality. I also assumed that Western Union and Moneygram rip off people by giving lower conversion rates. But that's just me wanted to find out the best deal there is. A sweet spot between convenience, the highest possible rate, the lowest possible fee at the fastest possible time.
My choices narrowed down to two services which I personally used (and liked) for the past 2 months - OrbitRemit and Transferwise. A summary of features is listed below:
Both services are easy to set up. But OrbitRemit has always been a remittance service of choice among my Pinoy peers. This is not surprising since the Wellington-based company has proven itself a reliable money transfer channel with competitive rates. It's also worth noting that the company focused it's initial operations in the Philippine market when it started around 2009 and expanded since then. Registration is pretty much a breeze. As a security measure, you just have to prove your identity and proof of residency. I did mine by uploading a copy of my passport and bank statement to their website. I was verified the very next day.
Sending money is pretty straightforward. You put in your intention to their website or using their Android or iOS app. You will be shown the estimated amount in pesos. Unfortunately, this is not guaranteed since currency exchange is volatile. Unless, there are large swings in the value, this is really not too significant. The next step is to deposit the money plus the 6 NZD fee to OrbitRemit's bank account. There's no inter-bank transfer fee in New Zealand as it's long as it's done locally. Although I'm not sure if the transfer is immediate. In my case, my bank is BNZ (Bank of New Zealand) and that of OrbitRemit's is TSB Bank. Either way, after I confirmed that I have sent the money and them confirming that they received it, the money was actually deposited to my BPI account later that evening. All done online.
Now I stumbled upon Transferwise from an online forum. I am very cautious about online services that involve money so I gather as much information as I can and mostly from the outset I can almost always sense irregularities. So finding about Transferwise and a more favorable offer BUT not hearing anything about it from everyone who has been here much longer than I am made me to dig deeper. Everything about Transferwise is pretty transparent. A former Skype employee - an Estonian - frustrated about the high cost of sending money between Estonia and London helped put up a startup company in 2011 which has become known as Transferwise. With such prominent financial backers as Peter Thiel (the co-founder of Paypal) and Sir Richard Branson (the founder of the Virgin group), this company has pretty impressive credentials. Still, why people I know are not using it is pretty damn suspicious.
So I took a chance and registered to their service. It's also reassuring when I knew that Transferwise's New Zealand bank is BNZ - the same as mine. For me that's a plus under the Pros list. It has almost the same registration process as OrbitRemit so it's pretty much a breeze. Once I was verified, I started sending a relatively smaller amount to my BDO account in the Philippines. Y'know just to test the waters. I admit I was a little surprised when the fund reached my Philippine account in a little less than 2 hours! And that's when I realized it actually worked!
A month later (that is earlier this week), I attempted to send to BPI - this time using Transferwise. Again, there hasn't been no problem but the money arrive probably in the late evening the next day or early morning on the second day. It's still in the 1-2 days promised time frame so there's no argument there. The last transfer I had that took only 2 hours was probably Transferwise way of welcoming me by first impression. Now I had to send again to BDO to settle some debts. I favored Transferwise again because why not? Between the two, I can actually save around 8 NZ dollars per transfer and the fact that I am locally transferring NZ monies to the same bank as mine is easing out some risks along the way. Here's the interesting part. The money was AGAIN deposited to my BDO account in just around 2 hours! Here's when I realized that most probably, the bottleneck is within Philippine banks - in my case with BPI!
After making two sets of transfers in the span of 2 months, here's my personal take between the two.
I'll give plus points to OrbitRemit for being an NZ homegrown company - probably also the reason why their support staff replies faster when you try to contact them. Being able to pay to credit cards and send cash for pick-up thru M. Lhuillier branches throughout the Philippines is pretty much a plus as well. Although I haven't had the urgent need to use that feature, it's good to know that I have access to that option when the need eventually comes. I'd give the points to Transferwise for a much higher conversion rate. Even after taking out the fee, the net amount is still a little bit higher than OrbitRemit by around 8 NZD (around 290 PhP). That would certainly pile up in the long run. I'd give another points to Transferwise for having the same NZ bank as I am so the send transfer is certainly more immediate than transferring to another bank.
So in conclusion, I am probably sticking with Transferwise for the time being. The benefit outweighs some risks and inconvenience. I'm not ditching OrbitRemit though. It would remain as some kind of support when the need arises. Of course there are still a lot of options out there. Western Union and Moneygram's main advantage probably is their faster delivery times. I know someone who uses WorldRemit and said it served his needs well. I guess it boils down to our own individual preference. It's just awesome when all options open up for us to consider.
Wow, can't believe it's literally two months today since I left the Philippines. It's been a blast so far. New Zealand has always been a magical place for me and it's still is. Although unfortunately, I haven't been to the Hobbiton set yet. Sad! But that's another story (It's a 4-hour drive from where I'm currently at and I will definitely go there someday). I am officially an OFW - an addition to a demographic that has been a sturdy foundation of the economy back home. A demographic that on a macroeconomic level, contribute a very significant 10 percent to our GDP, narrows the gap in our BoP deficits, and cushion the impact of volatile foreign currency exchanges. I may be talking pure gibberish right there because on a very personal level, each one of us just wanted to take that piece of the pie back home. To help our love ones survive, to save some and to pay debts we left behind.
That's exactly my concern in my first few days here - to find a reliable service to send money home. Wire transfer is out of the question because of its sheer impracticality. I also assumed that Western Union and Moneygram rip off people by giving lower conversion rates. But that's just me wanted to find out the best deal there is. A sweet spot between convenience, the highest possible rate, the lowest possible fee at the fastest possible time.
My choices narrowed down to two services which I personally used (and liked) for the past 2 months - OrbitRemit and Transferwise. A summary of features is listed below:
|
|
|
|---|---|---|
| Markup against Market Rate | Yes | No (or very negligible) |
| Fee | NZD 6.00 (Flat Fee under NZD 10,000) | 1% (or PhP145 for under PhP 14,500) |
| Supported Recipient in the Philippines | Pickup from any M.Lhullier branch Credit Card Payment Bank Deposit |
Bank Deposit only |
| Delivery Time | 1-2 Days | 1-2 Days |
| Min-Max Amounts | Unlimited (As confirmed by their support although I'm not sure how this plays out with our Anti-Money Laundering Laws) |
PhP 5 - PhP 480,000 |
| PH Banks supported | Unspecified, but major banks are probably supported (personally tried BPI and the funds came in just fine) | Majority of PH Banks (Find the Complete List here) |
| Mobile app | iOS, Android | iOS, Android |
| Headquarters | Wellington, NZ | London, UK |
Both services are easy to set up. But OrbitRemit has always been a remittance service of choice among my Pinoy peers. This is not surprising since the Wellington-based company has proven itself a reliable money transfer channel with competitive rates. It's also worth noting that the company focused it's initial operations in the Philippine market when it started around 2009 and expanded since then. Registration is pretty much a breeze. As a security measure, you just have to prove your identity and proof of residency. I did mine by uploading a copy of my passport and bank statement to their website. I was verified the very next day.
Sending money is pretty straightforward. You put in your intention to their website or using their Android or iOS app. You will be shown the estimated amount in pesos. Unfortunately, this is not guaranteed since currency exchange is volatile. Unless, there are large swings in the value, this is really not too significant. The next step is to deposit the money plus the 6 NZD fee to OrbitRemit's bank account. There's no inter-bank transfer fee in New Zealand as it's long as it's done locally. Although I'm not sure if the transfer is immediate. In my case, my bank is BNZ (Bank of New Zealand) and that of OrbitRemit's is TSB Bank. Either way, after I confirmed that I have sent the money and them confirming that they received it, the money was actually deposited to my BPI account later that evening. All done online.
Now I stumbled upon Transferwise from an online forum. I am very cautious about online services that involve money so I gather as much information as I can and mostly from the outset I can almost always sense irregularities. So finding about Transferwise and a more favorable offer BUT not hearing anything about it from everyone who has been here much longer than I am made me to dig deeper. Everything about Transferwise is pretty transparent. A former Skype employee - an Estonian - frustrated about the high cost of sending money between Estonia and London helped put up a startup company in 2011 which has become known as Transferwise. With such prominent financial backers as Peter Thiel (the co-founder of Paypal) and Sir Richard Branson (the founder of the Virgin group), this company has pretty impressive credentials. Still, why people I know are not using it is pretty damn suspicious.
So I took a chance and registered to their service. It's also reassuring when I knew that Transferwise's New Zealand bank is BNZ - the same as mine. For me that's a plus under the Pros list. It has almost the same registration process as OrbitRemit so it's pretty much a breeze. Once I was verified, I started sending a relatively smaller amount to my BDO account in the Philippines. Y'know just to test the waters. I admit I was a little surprised when the fund reached my Philippine account in a little less than 2 hours! And that's when I realized it actually worked!
A month later (that is earlier this week), I attempted to send to BPI - this time using Transferwise. Again, there hasn't been no problem but the money arrive probably in the late evening the next day or early morning on the second day. It's still in the 1-2 days promised time frame so there's no argument there. The last transfer I had that took only 2 hours was probably Transferwise way of welcoming me by first impression. Now I had to send again to BDO to settle some debts. I favored Transferwise again because why not? Between the two, I can actually save around 8 NZ dollars per transfer and the fact that I am locally transferring NZ monies to the same bank as mine is easing out some risks along the way. Here's the interesting part. The money was AGAIN deposited to my BDO account in just around 2 hours! Here's when I realized that most probably, the bottleneck is within Philippine banks - in my case with BPI!
After making two sets of transfers in the span of 2 months, here's my personal take between the two.
I'll give plus points to OrbitRemit for being an NZ homegrown company - probably also the reason why their support staff replies faster when you try to contact them. Being able to pay to credit cards and send cash for pick-up thru M. Lhuillier branches throughout the Philippines is pretty much a plus as well. Although I haven't had the urgent need to use that feature, it's good to know that I have access to that option when the need eventually comes. I'd give the points to Transferwise for a much higher conversion rate. Even after taking out the fee, the net amount is still a little bit higher than OrbitRemit by around 8 NZD (around 290 PhP). That would certainly pile up in the long run. I'd give another points to Transferwise for having the same NZ bank as I am so the send transfer is certainly more immediate than transferring to another bank.
 |
| Sending NZD 1000 to the Philippines: Even if Transferwise (right) has higher fees, the conversion rate tracks the actual market rate such that I can actually save around 8 dollars (around 290 pesos) by using it. The 6-dollar fee for OrbitRemit (left) is not yet included in the payout amount shown. |
So in conclusion, I am probably sticking with Transferwise for the time being. The benefit outweighs some risks and inconvenience. I'm not ditching OrbitRemit though. It would remain as some kind of support when the need arises. Of course there are still a lot of options out there. Western Union and Moneygram's main advantage probably is their faster delivery times. I know someone who uses WorldRemit and said it served his needs well. I guess it boils down to our own individual preference. It's just awesome when all options open up for us to consider.
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