- Looking to transfer money over to the Philippines?
- Discover cheaper ways to do currency transfers USD to PHP than most banks.
- Learn what to look for when choosing the best way to transfer money.
This guide tells you what you need to know to complete a money transfer transaction when sending money to the Philippines from the United States.
In this guide
- Common reasons people transfer money overseas to the Philippines
- Why you shouldn't send money overseas using your bank
- Is it safe to use a money transfer company?
- USD / PHP exchange rates
- What are the fees?
- Minimum and maximum transfer amounts
- Alternative ways to send money to the Philippines
- Business vs. personal considerations
Common reasons people transfer money overseas to the Philippines
In 2020, overseas Filipinos sent personal remittances of $33.2 billion. Money was sent for reasons including:
- Supporting family members in the Philippines.
- Covering business expenses.
- Purchasing local real estate.
- Subsidizing immigration or emigration costs.
- Covering tuition fees.
- Paying for clothing or food costs.
- Donating to charity.
Why you shouldn't send money overseas using your bank
Sending money to the Philippines using the bank is the most expensive option available. You'll end up paying a transaction fee between $25 to $65, in addition to unfavorable currency conversion rates.
Both the sender and receiver end up paying transaction costs, and the receiver can also expect to pay between $15 to $30 on their side.
Online money transfer companies and e-wallets like PayPal and cryptocurrency offer you far cheaper rates with faster transaction processing times.
Is it safe to use a money transfer company?
It's entirely safe to use a retail money transfer company like Wise or Western Union for processing your international transfer.
Look through the providers on Finty's list, and you'll find our top picks for established retail exchanges for processing transfers to the Philippines.
We only list money transfer services that are operated by experienced teams, licensed and regulated in multiple countries, and have a reputation of helping thousands of customers to send billions of dollars to family or for business purposes.
USD / PHP exchange rates
The margin charged on the exchange rate presents the greatest proportion of your transaction fees. If you look at the current exchange rate, that's what the banks call the inter-bank lending rate, which is not available to the consumer market.
This "spot" price determines the benchmark, and the bank or retail exchange adds a "margin" to the spot rate. The margin can differ between providers, with banks typically charging you more than retail exchanges or e-wallets.
Since exchange rates are volatile, especially in emerging markets like the Philippines, most retail exchanges and banks allow you to "lock in" the costs for a period of time, usually 24 hours. As a result, you don't have to worry about fluctuations in the spot price affecting your transaction when sending money from the United States to the Philippines.
Online money transfer companies, e-wallets, and crypto offer you an affordable way to mitigate the costs of the transaction fees regarding the exchange rate.
What are the fees?
If you're sending money from the United States to the Philippines, you're going to have to pay a third party for processing the transaction. Regardless of whether it's a bank, retail exchange, or crypto, here's what you can expect to pay in fees.
What is a typical fee?
If you're transacting with the bank, the average transaction fee is around 5%, though it's considerably less using a retail money exchange like Wise.
With banks, you'll end up paying around $25 to $65 for your transaction fees, and the recipient will also need to pay $15 to $30 on their side for receiving the payment. With Wise, you pay a small fixed fee and a variable fee based on the transfer amount.
Cryptocurrency transaction fees are also low with options like Ripple and Dogecoin.
Can fees be avoided?
It's possible to avoid these high exchange rates and fees if you decide to transact using lesser-known vehicles like e-wallets and cryptocurrency.
However, your recipient might not understand how to use these facilities, and they may prefer using the traditional retail exchanges like Western Union and MoneyGram.
Minimum and maximum transfer amounts
If you're looking to send large amounts of money to the Philippines, then it's a good idea to do it through a traditional bank transfer. Most retail money exchanges have set upper limits for transfers between $7,00 to $10,000 per transaction.
Retail money exchanges will also have minimum limits of between $500 to $1,000, depending on the service provider. If you're using an e-wallet service like PayPal, you'll need to verify your account with KYC information before sending large amounts. It's the same for cryptocurrency exchanges like Binance and Kraken.
However, e-wallets and crypto exchanges let you send much smaller amounts to recipients in the Philippines. If you want to send someone $1, an e-wallet service like PayPal is the better option.
Alternative ways to send money to the Philippines
It's possible to reduce the costs of sending money to the Philippines using e-wallets and cryptocurrency. While both options have cheaper fees, the recipient might not know how to process these transactions.
Business vs. personal considerations
Regardless if you're sending money to the Philippines as a business or private person, you'll need to comply with AML and KYC protocols.
That means both the sender and recipient need to issue their ID document or passport, along with their cellphone number, for processing the transaction.
Even if the recipient is a business, the individual collecting the money will have to leave documentation with the processing agent.
How can I fund my money transfer?
You can send money from the USA to the Philippines using bank wire transfers, credit cards, or debit cards to fund your transfer.
How fast can my money transfer be sent to the Philippines?
Using a bank wire can take up to five days for the transfer to reflect in the nominated bank account. Money exchange services like Western Union may take anything from one to three days for the transaction. Using e-wallet services and crypto transfers are much faster, with some options completing transactions in as little as a few minutes.
What are the money collection options?
If you're sending it with the bank, it reflects directly in the recipient's account. If you're using a retail transfer service like Western Union, Wise, or MoneyGram, your recipient can collect their money from retail partner locations throughout the Philippines and some big-box stores.
Are there any tax considerations?
For 2021, US tax code permits a $15,000 gifting allowance for citizens per year or $30,00 for married couples. If you're sending more than this amount to the Philippines annually, check with your accountant for the relevant tax implications on your transfers.