Overview
Whether you're sending savings home, supporting family in India, or repatriating proceeds from a property sale, the route you choose has a real cost: the exchange rate margin, the flat fee, and how long the transfer takes all vary a lot between a traditional bank wire and a dedicated remittance service.
Liberalised Remittance Scheme (LRS) Basics
The LRS is the RBI framework that governs how much money a resident Indian individual can send abroad each financial year — it's most relevant if you're moving funds out of an NRO account or repatriating sale proceeds, rather than simply sending money into India.
- Outward remittances from an NRO account are generally capped around USD 1 million per financial year, after taxes are settled.
- Banks will typically require documentation showing the source of funds (salary, property sale, inheritance, etc.).
- NRE and FCNR account balances are freely repatriable and are not subject to the same cap.
Ways to Send Money To/From India
Traditional Bank Wire
- Sent directly through your bank or your recipient's bank (SWIFT transfer).
- Familiar and widely trusted, but often the most expensive route once you account for the exchange-rate margin.
- Can take 1–4 business days to settle.
Remittance Apps & Online Services
- Services like Wise, Remitly, Xoom, and bank-run platforms (e.g., SBI Remit, ICICI Money2World) specialize in cross-border transfers.
- Usually cheaper and faster than a bank wire, with transparent fee breakdowns.
- Transfer limits per transaction are often lower than a bank wire — useful for regular transfers, less so for one-time large sums.
Banks vs Money-Transfer Apps
| Factor | Bank Wire | Remittance App |
|---|---|---|
| Typical cost | Higher — hidden in the exchange rate margin | Lower — often shows the real mid-market rate plus a small fee |
| Speed | 1–4 business days | Minutes to 2 business days, depending on the corridor |
| Transfer limits | High — suited to large, one-time transfers (e.g., property sale proceeds) | Often capped lower per transaction |
| Best for | Large, infrequent transfers requiring paperwork (15CA/15CB) | Regular remittances — family support, rent, small savings |
Fees, Exchange Rates & Hidden Costs
- Exchange rate margin: the gap between the real mid-market rate and the rate you're actually offered — often the single biggest cost, and the easiest to overlook.
- Flat transfer fees: a fixed charge per transaction, which matters more for smaller, frequent transfers.
- Intermediary bank charges: SWIFT wires can pass through correspondent banks that each take a cut, especially for less common currency corridors.
- Compare the total received amount — not just the advertised fee — across two or three providers before a large transfer.
Tax Forms for Large Remittances (15CA/15CB)
For most outward remittances from India above certain thresholds — including NRO account withdrawals and property sale proceeds — banks require Form 15CA (a self-declaration filed on the income tax portal) and, in many cases, Form 15CB (a certificate from a chartered accountant confirming applicable taxes have been paid or accounted for) before they will process the transfer.