Cheapest Way to Send Money to Indonesia (Avoid Bank Fees!)

There are many reasons people send money to Indonesia, but only a few ways that are cheap, easy, and safe.

This article will be very useful to you if you are:

• A foreigner living abroad who supports his Indonesian girlfriend financially

• An Indonesian working abroad who needs to remit his salary in his Indonesian bank account

• An expat who wants to transfer funds to Indonesia to make a purchase (car, home) or an investment

• A traveler who lost his wallet and urgently needs money

Since I've been living in Indonesia, I have tried different methods to send money to the country.

The first time, I simply asked my bank to make a transfer to an Indonesian account. The experience was gruesome: It was complicated, it took several days for the money to arrive, and the total cost was almost 10% of the amount I sent. My bank charged a transfer fee of 29 euros + a commission of 3.5% on the exchange rate. Finally, the Indonesian bank also took a fee.

For my second transfer, I decided to try something else and chose Western Union. The process was easier and faster, but in the end, it was even more expensive than a bank transfer.

Thankfully, in the past few years, new players have emerged, such as Wise, that have drastically reduced the cost of sending money to Indonesia. Even better, they are more convenient (100% online) and faster to use. The most famous and most trusted is Wise (previously known as TransferWise).

In this article, I will explain to you each option I ever used to send money to Indonesia, starting from the cheapest one:

Wise (previously TransferWise): Cheapest and Easiest Way to Send Money to Indonesia

Created in 2011 by one of Skype's founders, Wise is a fin-tech startup that was recently declared a unicorn (more than $1 billion in valuation). It is a game-changer when it comes to international money transfers.

Compared with traditional banks, Wise does not actually transfer any money. It maintains bank accounts in key currencies in various countries. When you make a transfer request, for instance from USD to IDR, they will debit your US bank account from their US bank account and credit your Indonesian bank account from their Indonesian bank account.

Using Wise, the cost of sending money from abroad to Indonesia is only 1,5% of the transferred amount (minimum charge IDR14,500).

If you transfer USD1,000, it means you will only pay USD15 (+ a credit card charge depending on your bank). There are no hidden fees and they use the official exchange rate. That's at least 8 times less than what you would pay with traditional banks.

Pros:

➝ The cheapest way to send money from abroad to Indonesia to my knowledge

➝ As simple as it can be, just like booking a hotel room or buying stuff from any e-commerce site

➝ Less than 10 minutes needed to make the request

➝ They do not take a commission on the currency exchange rate (they use the official rate)

➝ You can make an accurate simulation of the cost of the transfer in a few seconds on their website

➝ They will tell you in advance when the money will be transferred and you can follow your money in real-time through their app

➝ 100% transparent: They let you know how much commission they took and the exchange rate they used

Cons:

➝ Available for transfer from USD to IDR but not yet from IDR to USD. Update 2021: It is now possible to send from Indonesia to another country

➝ A limited number of currencies you can transfer from: EUR, USD, Pound, AUD, JPY, SGD. You can check here if your home currency is accepted.

➝ You need an Indonesian bank account to transfer the money (You must know your IBAN and your SWIFT/BIC number)

➝ The transfer is not automatic and it may take from 1 to 2 days to be completed (for an Indonesian transfer)

Western Union: Only for Urgent Money Transfer to Indonesia

Western Union is facing tough competition but it can still be a useful way to send money to Indonesia. In particular, if you are a traveler who lost his personal belongings and need fast money, there are no better alternatives (actually, there is also MoneyGram which is similar).

I was using Western Union a lot when I didn't have an Indonesian bank account. You can pick up the money sent in cash in any of their agents locations (for instance in post offices - there are thousands in Indonesia).

The problem with Western Union is that it is expensive. If you want to transfer 1,000USD to IDR (instant transfer from an agent to an agent), it will cost you over USD80 + an hidden exchange rate fee of around IDR500,000 (as a reminder, it costs only USD15 with Wise).

If you transfer the money to an Indonesian bank account, it is cheaper yet still over 40$ and it takes a few days.

Pros:

➝ You can send money to Indonesia within minutes ➝ Money can be sent even if both the sender and the receiver do not have a bank account ➝ Works for virtually every country ➝ You can pay directly on Western Union's website using your credit/debit card

Cons:

➝ Very pricey if you choose fast service and to send/receive money in agent's location ➝ Hidden commission on the currency exchange rate ➝ If you send money to an agent location, you can only use the service during operation hours (close on weekends)

A Cheap Way to Avoid: Skrill

On paper, Skrill has quite many advantages. It is fast and cheaper than Western Union (about 3% from total amount Vs. up to 15%). Also, the person who receives the money does not need to have an Indonesian bank account. She can just take the money from any Alfamart in Indonesia with only her ID.

However, I received a negative comment regarding their company. I decided to publish it here in case some of you would be interested in their service for a transfer:

"Hi Thibaud, I registered with Skrill, and tried to send money to Jakarta for my girlfriend. The amount was deducted from my card and appeared in "My account" in Skrill.

However, the status of the transfer appeared as "pending" at first, and then later changed to "canceled". I tried to make another transfer, which was also not delivered to the recipient.

I've sent multiple emails to the Skrill support team. Number of responses from them: Zero. I tried to contact them on Facebook & Twitter with the same result (Zero support).

Finally, I had to spend some $5 to call their London office - the guy there didn't have a clue what the problem was. When I asked how I could get my money back, he said that I needed to speak with a SENIOR manager, and it could only happen 24 hours after my initial call.

So, as of now, I'm waiting for these 24 hours to pass to call London again and "beg" the senior manager to have my money back.

Don't know how all this looks to you, but for me, it appears as a completely unprofessional business on the edge of being a scam.

Money not delivered, nobody answering emails, having to spend extra money for international calls, and I still don't know if I will ever get my money back.

Last but not least - I had a look at the Skrill reviews (which I should have done BEFORE using it) - and it's full of similar stories from other customers: money not delivered, zero support, very difficult to get your money back".

My conclusion? Just stick to Wise. It is rated 4.7 on the Apple Store and recommended by the Financial Times, The Economist, Wired, etc.

Other Ways to Send Money To Indonesia

Some online currency exchange companies are starting to offer international money transfers now with competitive rates. They will always be more expensive than Wise though. They can be useful only if you intend to send a lot of money to Indonesia (over 10,000$). The most famous companies are TorFX, HiFX or OFX. I would advise you to try the latter as it has an online simulation tool.

PayPal is very cheap when you send money in the same currency to another PayPal accounts holder. That can be interesting in a few situations, but for most people (international transfers from a PayPal account to a bank account), it is not worth it. When you add up the fee and the commission on the exchange rate, it costs about 80$ for 1,000$ sent.