Money transfers: pros and cons

2016-06-10 00:00:00

Has anyone thought about what money is. After all, this is such a mobile thing that does not like to sit still, it can even be conditionally called an entity. If money is not moving, it is called dead capital. The name is not very flattering. But it follows that they should not lie in boxes, "stockings" or banks for too long.

Their purpose is to fulfill their sacred duty - to be a means of payment for the received goods, services, work, etc. In order to improve the process of money turnover, various methods were invented. It is important to understand what each of the money transfer options is - the pros and cons, so as not to make the wrong choice.

 

Intermediary companies

A company is created that represents an intermediary in the relationship between the payer and the recipient. For her services, she names her price - this is the commission.

Some services have more disadvantages when making money transfers, while others, on the contrary, have more positive characteristics.

In Russia, for example, a "good" hundred of them have been discovered. But those who have won the greatest recognition from customers, have managed to develop their business and make it successful, entered the TOP-ten. These include: Western Union, Russian Post, Sberbank, Contact, MoneyGram, Allure, Migom, etc.

To understand what are the pros and cons of each of the money transfer systems, lets look at the principles by which the named systems work:

• Those wishing to send a money transfer must have identification documents with them. They must be presented at the company point.
• A completed application indicating the personal data (passport) of the applicant, the detailed address of the recipient and the amount of the transfer.
• Service payment (commission).
• The sender is handed a receipt confirming the transaction.
• The recipient is notified of the transfer of money, he is given a code by which he can receive it.

If the system works according to this algorithm, then both parties are satisfied, because they are provided with:

• Simplicity of design.
• High speed of translation.
• Money can be received at a point working from this company (there are many such points).
• Until the money falls into the hands of the recipient, it is possible to return it by canceling the transaction.

But there are many companies that do not analyze the experience of others, or, due to the insufficient number of clients, are forced to tighten some conditions. And if in a given locality there is no choice, a person is forced to apply there, despite the fact that there are many disadvantages in making money transfers.

The most common negative points:

• High commission fee.
• The duration of the transfer is not very fast.
• The administration of the intermediary company sets limits on the amount of transfers.
• Limited choice of countries where you can make an international money transfer.
• There are no additional services.

Of course, it is better to use more well-known intermediary companies that have proven themselves on the positive side. And also it is worth giving preference to their offices, branches, points.

 

Bank transfers are secure

Modern banking institutions in recent years have significantly expanded the range of their services. Although they began to carry out money transfers a long time ago. What are the advantages of banks in comparison with other services:

• Transactions within the banking system no more than 5 minutes.
• The sender can transfer cash, as well as transfer from a bank card of any purpose (credit, deposit, salary or pension).
• You do not need to open a bank account to send a single transfer.

There are also problematic points in banking systems that can be attributed to disadvantages when making money transfers:

• Sometimes the transaction time takes several days.
• A bank transfer is more expensive for the sender compared to other services (online banking, ATM).
• Citizens of Russia in any case need to open a bank account.
• The transfer must be made only in the presence of the sender at the bank.

There are also options for money transfers such as mobile, internet banking, and electronic payment systems.

 

Virtual systems with real payments

Electronic services have become very popular. There are more and more users of these innovative systems. Among the most famous are WebMoney, Yandex.Money, and Qiwi. And this is only a small fraction of the total number of them in the virtual financial market.

If they belong to the status of innovative, naturally, they have a number of indisputable advantages:

• The instantaneousness of money transfers.
• To make a transfer, and there is not enough money on the electronic wallet, it can be replenished from an account within the service, a bank card, through special terminals.

There is nothing perfect in the world, just as electronic systems are faulty, they also have some disadvantages:

• Limitations in transaction volumes.
• Some systems have quite high commissions.

Along with other traditional options for making money transfers, in terms of comfort and financial costs, electronic systems should be classified as the most convenient and rational.