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by Expatguru - 08/02/2011
"This article describes the process of money transfer by expatriates working in the Middle East, useful tips and things to take care."
Sending money home by expatriates is a fairly simple procedure in the Middle East. There are several banks and money changers (called “exchanges”) through which one can send their remittances. However, you must choose carefully from where you send your money.
After 9/11, a lot of changes have taken place in the money market. The most important one is that you must register yourself with any bank or exchange for you to be able to send money anywhere. If you are going to send money from the same bank in which you have an account, this condition is usually waived because your details are already available with the bank. But in all other cases, registration is mandatory which requires you to submit a copy of your passport with the visa page. Some exchanges specifically ask for a letter from your sponsor with his signature and seal. Note that when your residence permit is renewed, you must once again submit these documents, otherwise your remittance would be blocked.
It is quite common to find different rates quoted by different exchanges / banks and even among different branches of the same exchange in the same city. Note that other than Saudi Arabia, in all other countries you can even bargain with the bank / exchange for a favorable rate! When the amount you transfer is more, exchanges do some marginal adjustment in the rate if requested and this could be a bonanza! Some expatriates prefer to save their money and send home once every two or three months when the rate becomes favorable. But then there are risks involved, as the rate keeps changing each day. Also note that when the amount you are remitting exceeds a certain limit (usually USD5000), you would be required to show proof of your income / your bank statement, to prove that the transaction is not clandestine.
Most exchange houses operate 12 hours/day except for the first half of Fridays. They have what is known as “correspondent bank” arrangement, which means that if you have a bank account back home in one of these correspondent banks, transfer of money is immediate. In case your account is NOT in the correspondent bank, there may be a further deduction of charge by the correspondent bank back home, before the money gets transferred to your own account usually within a day. So, you actually end up paying lot more in commission, which is why it is so important to choose your exchange / bank carefully.
There are several ways of money transfer, with wire transfer being the most common. People also send money through Demand drafts. It is indeed quite a pain to recover your money if your draft is lost in transit. In any case, always fill in the details correctly while sending money and keep the counterfoil safely till you make sure that the money has actually reached your account back home. I would also advise you to have multiple registrations with various exchanges, so that you get the best bargain. After all, it is your hard earned money and you should go smiling to the bank at the end of the month!
Expatguru
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