Response
Posted: Thu Mar 12, 2015 1:56 am
@Basmad6
Your credit union probably lied to you, or at least didnt tell you the whole truth and story. The problem is credit unions usually (mostly) do not have international routing numbers. There are two types: IBAN (International Bank Account Number) and SWIFT. Your credit union likely uses an ABA (American Bankers Association) routing number. This only works in the US. When your overseas bank wants to wire funds to your credit union they look up the receivers information and since it doesnt have an IBAN or SWIFT code that information is going to identify a bank that does have an IBAN or SWIFT code, and that bank is going to act as "clearing house" or intermediary for your transaction. Your China Bank sends it too this intermediary Bank (often in NY), then the intermediary bank using the FEDWIRE wire transfer system sends it to your credit union. True your credit union doesnt charge a fee, but that intermediary bank, typically a large commercial bank, is going to deduct a fee between $10-$50 depending on the sending bank, any agreements it has with your credit union, and the amount of the transfer. The 2 variables are 1) No ones going to tell you what that fee is until after your first transaction, and you see how much was deducted from the transfer and currency conversion. 2) Some banks dont need intermediary banks.
A wire transfer will cost you about $18 if you do it online, and $20-$30 if you do it over the counter (depending on the commission for counter wires). If you intend to rely on wires, because you anticipate a once a month or less wire transfer you will want to use Bank of China (BOC). They have internet and mobile banking which gets you the online rate, and BOC has their own branch office in NY with FEDWIRE access that can handle the whole transmission (sending) of a wire transfer, since your credit union doesnt charge anything to receive, your looking at $18 for each transfer.
If you want to spend more money and have more banking services you can open an international banking account with HSBC (they are the only international US-China bank). Their Premier account offers free global accounts and transfers between your accounts, as well as bill pay, unlimited global ATMS, lower conversion fees, etc. The fee is $50/month (unless you can keep $100K in the account). They have a new Advance account thats $20/month, but you have to open 2 account (one in China and one in the US, and it comes to about $36, plus the account transfer fee is $7 per transfer).
Remittance services, like Money Gram, and Western union are about $30-$50 for an agent based transaction, but someone has to pick it up and deposit it in your account.
Paypal is the cheapest. Now that debit cards are more common, you get a UP (UnionPay) debit card from BOC (Bank of China), you use it to fund your paypal account which only costs the RMB->USD conversion fee (2%-3%), which you have to pay with any transaction, and they you can withdraw the funds to your US Bank account for free. The funds get posted to pay pal the same day and the withdrawal takes a day.
There are some other options:
You can get a bank draft from a bank like HSBC or BOC in USD, and either mail it too your credit union for deposit (slow) or you can try using your mobile banking app and use photo deposit (sometimes it works, sometimes it gets rejected, sometimes your account gets frozen while FINCEN investigates).
You can try using the BOC (or other Chinese banks) online banking and bill pay features, to send your self a a "payment" using your bank as the address and receiver. If youre wiring funds due to financial obligations you can just try to pay the bills directly with the Chinese banks bill pay.
You can buy travelers cheques in USD which be purchased for about 1% (plus currency conversion) and then endorsing them to yourself and account number, while signing them and then mailing them to your credit union (take pictures of them), they can be replaced for free. if lost and you can have the "replaced" cheques delivered to a trusted family member in the States and just have the family member register and endorse the cheques to your account, avoiding the mailing issue.
You can send cash in an envelope but thats VERY risky, and the cost of EMS is the same or more than a wire transfer.
Your credit union probably lied to you, or at least didnt tell you the whole truth and story. The problem is credit unions usually (mostly) do not have international routing numbers. There are two types: IBAN (International Bank Account Number) and SWIFT. Your credit union likely uses an ABA (American Bankers Association) routing number. This only works in the US. When your overseas bank wants to wire funds to your credit union they look up the receivers information and since it doesnt have an IBAN or SWIFT code that information is going to identify a bank that does have an IBAN or SWIFT code, and that bank is going to act as "clearing house" or intermediary for your transaction. Your China Bank sends it too this intermediary Bank (often in NY), then the intermediary bank using the FEDWIRE wire transfer system sends it to your credit union. True your credit union doesnt charge a fee, but that intermediary bank, typically a large commercial bank, is going to deduct a fee between $10-$50 depending on the sending bank, any agreements it has with your credit union, and the amount of the transfer. The 2 variables are 1) No ones going to tell you what that fee is until after your first transaction, and you see how much was deducted from the transfer and currency conversion. 2) Some banks dont need intermediary banks.
A wire transfer will cost you about $18 if you do it online, and $20-$30 if you do it over the counter (depending on the commission for counter wires). If you intend to rely on wires, because you anticipate a once a month or less wire transfer you will want to use Bank of China (BOC). They have internet and mobile banking which gets you the online rate, and BOC has their own branch office in NY with FEDWIRE access that can handle the whole transmission (sending) of a wire transfer, since your credit union doesnt charge anything to receive, your looking at $18 for each transfer.
If you want to spend more money and have more banking services you can open an international banking account with HSBC (they are the only international US-China bank). Their Premier account offers free global accounts and transfers between your accounts, as well as bill pay, unlimited global ATMS, lower conversion fees, etc. The fee is $50/month (unless you can keep $100K in the account). They have a new Advance account thats $20/month, but you have to open 2 account (one in China and one in the US, and it comes to about $36, plus the account transfer fee is $7 per transfer).
Remittance services, like Money Gram, and Western union are about $30-$50 for an agent based transaction, but someone has to pick it up and deposit it in your account.
Paypal is the cheapest. Now that debit cards are more common, you get a UP (UnionPay) debit card from BOC (Bank of China), you use it to fund your paypal account which only costs the RMB->USD conversion fee (2%-3%), which you have to pay with any transaction, and they you can withdraw the funds to your US Bank account for free. The funds get posted to pay pal the same day and the withdrawal takes a day.
There are some other options:
You can get a bank draft from a bank like HSBC or BOC in USD, and either mail it too your credit union for deposit (slow) or you can try using your mobile banking app and use photo deposit (sometimes it works, sometimes it gets rejected, sometimes your account gets frozen while FINCEN investigates).
You can try using the BOC (or other Chinese banks) online banking and bill pay features, to send your self a a "payment" using your bank as the address and receiver. If youre wiring funds due to financial obligations you can just try to pay the bills directly with the Chinese banks bill pay.
You can buy travelers cheques in USD which be purchased for about 1% (plus currency conversion) and then endorsing them to yourself and account number, while signing them and then mailing them to your credit union (take pictures of them), they can be replaced for free. if lost and you can have the "replaced" cheques delivered to a trusted family member in the States and just have the family member register and endorse the cheques to your account, avoiding the mailing issue.
You can send cash in an envelope but thats VERY risky, and the cost of EMS is the same or more than a wire transfer.