This is the transfer of money between sender (who is living in one country) & receiver (who is living in another country ) . The transfer of funds are called remittances . As transfer of money takes place between the two different countries so it is called foreign remittances .
There are two participants one is called active participant and other is called passive participant . The person who sends money is called active participant & the person who receives money is called passive participant .
1. Types of Remittances :
- Inward Remittance : In this remittance , person is passive participant , because he has to given his details to sender who will transfer money . Therefore in Inward remittance money is received from abroad .
- Outward Remittance : In this remittance , person is active participant because he has to transfer money to recipient account . In outward remittances money is sending abroad , hence one should always choose right bank for outward remittances .
2. Be careful about choosing Bank :
The person should be careful about choosing bank for transfer of money .
- Time for Process Completion : In how much time bank will complete the remittance processes . Some bank complete the transfer process within two days .
- Hidden Fee : One should always check before transferring that is there any hidden fee is imposed on remittance .
- Check Limitations : How much money can be transferred . What is the maximum limitations (Maximum Amount) of transferring money .
- Exchange Rate : Before transferring one should always check that how much is the exchange rate .
Thus we can say that foreign remittances are the financial lifeline for a person living abroad .