What is Remittance Meaning?

The meaning of remittance is to send money from one party to another, domestically or internationally. Remittance term is used internationally where individuals or businesses send money to their family members or trade partners who are living overseas. The term "Bank remittance" encompasses not only personal transactions but also foreign transfers made by large corporations and governments.

What are the Types of Remittance?

There are two types of Remittance in terms of banking services:

Outward Remittance

It represents the transactions you make with a foreign country. For example, you are sending money to your child who is studying abroad. In India, outward remittances are subject to certain limits and regulations that are set under the Foreign Exchange Management Act (FEMA) by RBI of 1999.

Inward Remittance

It represents the money received from a foreign country.

For example, an expatriate family member who works in a foreign country sends money to his family. Inward remittances are further categorised into two types: cash and electronic.

What are the Benefits of Remittance?

• Security: To prevent fraudulent activities, banks use advanced security protocols and encryption methods. This ensures that your funds are transferred securely. 
• Convenience: Online remittance can also be done by mobile apps and online banking methods, which is very convenient for seamless fund transfers.
• Global: Some specialised banks allow you to transfer money globally in different currencies. 
• Speed: Many banks also offer instant or same-day transfers to the receiver's account for remittances.
• Transparency: Banks mention the fee structure and disclose the exchange rates so that you can understand them properly. 
• Regulated Services: Banks follow all the money transfer regulations to maintain the legality for both domestic and international transactions.

Documents Required for Remittance

• Government-issued ID proof
• PAN Card
• Self-declaration regarding the relation with the beneficiary