Before starting the shipping process, it is best to confirm the type of documentation that you will need to do it; especially if you have to do the transaction in person. Typically, this information is available on company websites or by calling the customer service number.
Remittance Sending Options
The best option to send from the United States to Mexico varies from one person to another since there are several factors to take into account. To find your ideal method, the Consulate General of Mexico in New York recommends that you ask yourself the following questions:
- Who will receive the money in Mexico?
- What facilities does this person have to pick up the shipment at a bank or other establishment?
- How will the money sent be used?
- Is it better to receive it in cash or through a bank deposit?
- How quickly do you need your relatives to receive the money in Mexico?
- How much does the company charge you for shipping?
- What is the amount of money you want to send?
- Are there additional costs for shipping?
Once you answer these questions, it will be easier for you to compare available shipping types. In this way, you can decide which one is best for you and the person who is going to receive the money in Mexico.
Remember that a service that works for you on a regular basis is not necessarily the best one for making emergency shipments. If circumstances change, it is helpful to consider all available options for efficient shipping at an affordable cost. Therefore, it is recommended to know all the options and keep them in mind whenever you have to send money to Mexico.
Many banks and credit unions in the United States offer remittance services to Mexico. If you plan to send shipments frequently, ask if your bank participates in the Directo a México agreement in the United States . It is also important to confirm if the person who is going to receive the money in Mexico has a bank account in one of the institutions that participate in the agreement.
These electronic transfers allow you to send money directly from your bank account in the United States to your relative’s account in Mexico. You deposit in dollars and the other person receives Mexican pesos in their account, according to the interbank exchange rate.
Bank-to-bank remittances are generally an inexpensive option, as costs tend to be low. Another advantage is that beneficiaries in Mexico receive their money in just one business day.
You are probably familiar with traditional remittance companies. Some of the best known are Western Union , MoneyGram and Vigo , as they have been around for many years.
The first step in sending money through one of these companies is to find a branch near you; especially if you want to pay in cash, since that type of transaction must be done in person.
Many times, these companies are located inside pharmacies or supermarkets. Upon arrival, you will tell the agent that you want to send money to Mexico. You will need to fill out a simple form, hand over the cash to the agent, present your identification and also pay a service fee.
Once the transaction is complete, your beneficiary in Mexico will be able to withdraw the money in a matter of minutes. It is for this reason that traditional companies are one of the most popular options when it comes to sending urgent remittances.
Apps and other options
In recent years, technological advances have made it easier to send remittances from the United States to Mexico. Thanks to the Internet, you can send money to Mexico from your computer or mobile phone. The convenience of these options is that they save you time and can be done with your PODERcard as a payment method.
It is also possible to pay for certain services contracted in Mexico from the United States. For example, in this article we explain how to pay for a phone in Mexico from USA .
In addition to offering in-person service, many traditional remittance companies also allow you to process remittances from their websites or apps. Some of the most popular apps today are Xoom , OFX , and Remitly .
Other alternatives for sending electronic shipments from the United States to Mexico include:
- electronic wallets such as PayPal;
- prepaid cards that you buy in the United States and send to your beneficiary in Mexico;
- wire transfers for beneficiaries in rural areas with little access to banking institutions;
- money orders (known as Money Orders , in English).
What are the costs and taxes when sending remittances from the United States to Mexico?
Sending remittances to Mexico entails different costs, among which are: transfer fees, taxes and unfavorable exchange rates. The exact amount you will need to pay will depend on the shipping method you choose to use and the speed of the service. Typically, the faster you need your recipients to receive the money, the higher the transfer fee will be.
One of the most common questions is whether remittances are taxable. According to the Income Tax Law, people who receive money in Mexico are exempt from paying taxes as long as the shipment is a donation between direct relatives.
The companies that process the shipments charge a fee for remittances sent to Mexico. The exact amount varies from company to company. Commissions can be a percentage of the amount sent or a pre-established figure according to a price list.
If you use a bank that participates in the Directo a México agreement in the United States, the cost of the shipment is approximately USD 5. The person receiving the shipment in Mexico does not pay anything to withdraw the money.
Percentage applied to the exchange rate
According to the Bank of Mexico, remittances receive the most competitive exchange rate. The reference used is the interbank exchange rate published by this institution on the day the beneficiary receives the money. However, it is important to note that some remittance services advertise very competitive transaction fees, but make their profits by offering unfavorable exchange rates to the customer. It is always advisable to compare the exchange rates offered and know in advance how much money your beneficiary will receive in Mexican pesos.
To research the exchange rate of the day, Banco de México recommends using the US Federal Reserve website .
How much money can be sent by remittances to Mexico?
This is another frequently asked question that members of our community have regarding sending remittances from the US to Mexico. Some companies have a limit amount for remittances, but this amount depends on the company you decide to use.
With the Directo a México agreement , there is no limit amount. You can send the amount you want as often as you want, as long as the transfer is between your bank and the beneficiary’s bank. However, the portal of Procedures and Services of the Government of Mexico indicates that there is a limit with respect to taxes. The maximum amount that a family in Mexico can receive without paying taxes is USD 155,000 per year.
With time and the advancement of technology, sending remittances from the United States to Mexico has become easier and faster. As you will see, the most convenient sending method for each person depends a lot on their personal needs and the frequency with which they send money to Mexico; but we hope that the information we present to you will be useful when making your choice.