Bkkshadow Compares using Steemit, Paypal, Western Union or the Banks for International Money Transfers.
As the world becomes globalized, more and more people find themselves working in a country that is not their own. This world of Ex-pats includes me. However, as is the case with me, I still need to transfer money back home every month. I'm not alone and as such, the remittance market is a billion dollar industry.
My Situation:
WORK - $$$ - TRANSFER
I live and work in Bangkok, and receive my salary every month, locally in Thai Baht. Now, each month I need to send about $1000AUD back to Australia. So, I figured, lets look at my particular choices to do this and compare them.Then let's see how they compare to the possibility of using steemit for remittance with either steem or steem dollars.
My goal - Get $1000AUD to Australia with the least amount of fees.
MY OPTIONS:
Western Union
I've often thought of WU as the evil overlord of money transfers. WU is ubiqituos with remittance as they make it possible to send and receive cash almost anywhere in the World simply with a photo I.D. I've used WU in various countries and for the most part it is a quick and painless process, which is why people love it. What I don't love about WU is their fees.
I'm not sure if WU have been forced to sharpen their pencil since the introduction of Bitcoin and Crypto in general, but when I checked out their cost, it didn't seem to unfair. I remember the few times I used it many years ago, You honesty felt like you were getting screwed, it was that bad.
So, its gonna cost me $1025AUD according to WU to get my $1000 to Oz. Ok, but thats not factoring in their less than favorable exchange rate. Let's have a look at the forex rate they are offering, so I can see exactly how much Thai Baht it will cost me.
According to the WU currency convertor, it's going to cost me 27,130 Baht to get my $1025AUD. Not bad I guess, but let's keep looking.
Paypal
I'm going to be honest. I despise Paypal with every inch of my body. They have pretty much operated with impunity as the only payment solution on the internet for the last 20 years. There are many reasons for my feelings of animosity towards them, not least that they can and will lock-up your account at will for up to 6 months, freezing your assets. When you are a small business this can really hurt, trust me. Next, for inbound money, from the time the money hits my Paypal account it takes on average 7 working days to have it in my bank account. This means usually about 10 actual days...Why Paypal why?
But my real issue is the Forex gouging. You can just about be guaranteed that Paypal will be offering the worst rate available at that given time. I am not talking by a small amount either. They really take advantage of this.
So, after trawling round and round thru Paypal looking for a simple fee calculator, I realized there wasn't one, things aren't meant to be easy with PP. So I initiated a transaction to estimate the cost.
WoW! Fees are worse than WU; its going to cost me approximately $34 to send my $1000 to Australia.
Now, when we factor in the Paypal awesomeness with the exchange rate, you will see its going to cost me a whopping 27,478 Baht to get my $1000 to Oz. I guess Elon Musk needed to get the money for his Space-X from somewhere (I'm being facetious).
Bank Transfer
This is the method that I have been using so far. I can do it online (only during bank hours) it usually arrives within 1 day, and the fees are acceptable.
You will see here, that its going to cost me 2 fees (300 Baht + 800 Baht) so that's 1100 Baht. Using the bank's forex exchange rate:
Interestingly, if my calculations are correct, this method will cost me about $41, which is far worse than I thought. So its going to cost me 26,785 + 1100 Baht to transfer directly from my bank, making a total of 27,885 Baht. Ouch!
And...this is the method I have been using as my prejudices convinced me that it would be cheaper than PP or WU. Time to change that, beginning next payment.
Private Institution (OzForex)
I'd heard good things about a variety of FOREX providers, so I picked one that had been recommended to me.
Well that's not very helpful...However, they still do have a currency convertor for some strange reason, so IF they could do it, how much would they hypothetically charge me? Well they have a flat rate of $15 for transactions under $10,000, so that's a good start.
So, IF they would make my transaction it would cost me 26,816 baht including the $15 for their service fee. Making them by far the best option. But they don't, so I don't know why I bothered.
STEEMIT
And, here we are at steemit. Not just a useful blogging tool, but also potentially an extremely powerful remittance tool. With an in-built wallet, no fees and practically instant transactions, you'd be mad not to use it. If I buy roughly 763 steem dollars ($1000AUD) and send it to Australia, then 763 steem dollars will arrive. Of course I will lose some fractions of a percent through the exchanges, but I won't require any forex. I simply purchase my BTC here in local currency.
You can see that 1.26BTC = $1000aud, so I go to my local exchange where I can buy/sell BTC (hopefully soon steem & SD).
Purchasing my 1.26 BTC at the current ASK rate in the order book will cost me a total of 26,584 baht
This includes the 0.25% fee and I get free withdrawals, So I use Bitcoin this to purchase steem or steem dollars on an exchange. Yes, I know I could have just done it with Bitcoin, but I want to do it with steem, OK. I can then send it the rest of the way instantly and fee free, from one steemit wallet to another steemit wallet. So, its going to roughly cost me 26,584baht. And it's that easy.
TOTALS:
1st. steemit - 26,584 baht
2nd. OzForex - 26816 baht (Not Possible at this time)
3rd. Western Union - 27,130 baht
4th. Paypal - 27,478 baht
5th. Bank Transfer - 27,885 baht
THE VERDICT:
STEEMIT WINNER !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
steemit wins out by roughly $20 from the next best option, and about $50 better than the worst option. I think you'll agree that there is a massive market here waiting to be tapped. That's just my experience, now times that by thousands of people with thousands of transactions everyday around the world...It's BIG!
Please tell me if I got something wrong in my calculations along the way. Honestly, I'm not that good at maths.
The Cost of Sending & Receiving Money
I got the idea for writing this after reading the great piece from @donkeypong which you may find here
PLEASE NOTE
I originally wrote this post for steemit 6 months ago, but it didn't get many views so I am re-posting it now. Therefore, the rates/values may have changed but the logic remains the same.
Click here to:
Steemit No 1, by far! Great comparison, if only more people knew about it :)
I feel the same way that many people (even on steemit) really haven't yet realized the power and advantage of having an easily fungible US dollar pegged crypto currency that can be easily (and very cheaply) converted between steem <-> sbd. Even as one example, imagine you're worried about something like what just happened in India. Want to protect your cash in a "safer" currency? Good luck getting ahold of dollars, even at a huge premium. BUT, if you are savvy enough to know how to get into steem dollars, you're all set.
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