Transferring money from India to Canada strips you of some amount due to conversions and bank/remittance company charges. When we moved to Canada, we had a few choices and figured out the best ways to transfer money conveniently and economically. Read on to know the options.
If you are a newcomer or planning to come to Canada and don’t have an account in Canada here are four ways to consider:
- Cash – Get your Indian Rupees converted into Canadian Dollars by an authorized money converter and bring Cash when you come to Canada. Although there is no limit to the amount of cash you can bring yet, if you are bringing more than CA$10,000, you must declare it when you enter the country. It is important to note that the limit of CA$10,000 applies whether you’re travelling alone or with family.
- Pre-paid Forex Card – A prepaid international Forex card is issued by most of the banks and financial institutions in India and is like a credit or debit card. All you need to do is to load the card with the desired amount and carry it hassle-free. Different card products offer different features, but all can be used as debit cards for shopping (retail or online). They also allow cash withdrawal from compatible ATMs across locations. However, there is a limit, and you may not be able to withdraw more than CA$500 a week/month. It is also easy to re-load the card with INR online using a bank website or mobile application.
- Bankers Cheque/Draft – A banker’s check/draft is similar to a personal cheque, a paper document encashable at eligible banks internationally. It is easier to carry and safe because only you can deposit it in your bank.
- Guaranteed Investment Certificates (GIC) – Students applying through Student Direct Stream (SDS) are required to deposit CA$10,000 as proof of funds and living expenses for one year. Over the period of one year, the student gets this amount back in equal installments. However one must not deposit all the money in GIC as you may not get money before the next due installment, should you require. You are also entitled to interest on the amount, but generally the amount is unnoticeable.
- Wire transfer/SWIFT transfer – Wire transfer uses SWIFT code to transfer money between two bank accounts from any participating country in the world. This process is simplest if you have a bank account in India and Canada as the transaction is seamless. All you need is to add your Canadian Bank account using the SWIFT code (provided by the bank) and simply transfer the desired amount.
- Online Remittance Companies – Of late, we have seen emergence of a lot of online companies like Wise, Instarem, Bookmyforex, Extravelmoney and one of the oldest Western Union. Remitly is one of most common companies used to transfer money from Canada to India. These companies are gaining pace as compared to the traditional banks and attract millennials with low transfer fees.
One should also keep in mind the LRS regulations for transferring money from India to Canada. Under the Liberalised Remittance Scheme (LRS), all resident individuals, including minors, are allowed to freely remit up to USD 2,50,000 per financial year (April – March). However, a 5% TCS (Tax collected at Source) is applicable on remittances sent through the Liberalised Remittance Scheme (“LRS”) that exceed INR 7 lakh from October 1st, 2020.
We used the following methods:
- Cash – Minimum amount (CA$500), when my wife was coming for studies to cover her daily ad hoc needs. This amount lasted for more than 6 months as most of the expenditure happens using the card
- Forex Card – To cover most of the living expenses during the stay
- GIC – As she came here as a student, a deposit of CA$10,000 was essential
- Wire Transfer – Once the bank account opened