Monday, 14 January 2019

How to send and receive money from abroad for cheap - (even) Lower fees with InstaReM

What should you use when sending or receiving money from abroad?

It should be common knowledge by now that whenever you're transferring money abroad, remitting through your bank is seldom the best solution, given the higher fees charged. The exchange rate is usually less favourable (compared to Google), and a service fee is imposed for the transfer, which therefore reduces your capital being sent across.

So how do you know what's the best to use for your money transfers / remittances?

Simple, check how much you receive on the other side.

In recent years, online fintech companies have emerged globally to offer fast and cost-efficient digital cross-border money transfer services to both individuals and businesses. I previously reviewed one popular option - TransferWise - and was recently informed that there's a new challenger on the scene with even more competitive rates:

InstaReM (short for Instant Remittance).

Currently ranked as the most cost-effective money transfer service in a number of corridors originating from Asia in the World Bank's Remittance Price Worldwide database, InstaReM could now be one good option for exchange students, parents sending money to their children studying abroad, foreign workers, and businesses alike who deal with overseas suppliers. Of course, in this gig economy, freelancers working for overseas businesses / websites will benefit greatly from using InstaReM to send and receive payments.

The Singapore-based remittance start-up promising to be the new market challenger has investors so convinced, that they've managed to raise over USD 63 million well ahead of its expected IPO in 2021.

Let's do a quick comparison of how they stack up:

I tried to send SGD 2000 via InstaReM and TransferWise and here's how they stacked up:

Quite comparable, but at this moment (even without the coupon code), InstaReM gives me more bang for my buck to send my money through them.

My Review of InstaReM

In short, its user interface is easy-to-use and straightforward enough, and their partner network with over 8000+ banks is how they're able to offer low fees across borders as quickly as 1 or 2 business days. 

But let's first go into the details:

Is InstaReM regulated?
Yes. Currently powering payments for 3 of the top 10 South-east Asian banks, InstaReM already has regulatory licenses and approvals to send money from Singapore, Malaysia, India, Hong Kong, Australia, United States, Canada and Europe. Through InstaReM, you'll be able to send money to India, Malaysia, Philippines, Indonesia, and over 50+ other countries across the globe. They're also currently in the midst of getting approvals for Indonesia and Japan (target completion by March 2019).

How much fees do they charge?
Much lower than the banks. Similar to TransferWise, InstaReM offers mid-market rates sourced directly from Reuters and does not add any margins on forex (FX) rates at all. Instead, a nominal fee (between 0.25% - 1%) is charged to cover the costs of processing the transactions. The larger your amount being sent abroad, the lower the fee, and anything above $10,000 in a single transfer is charged at a flat fee of 0.25% (the lowest).

Any additional benefits?
InstaReM also offers a rewards system where you can earn InstaPoints on every transaction and successful referral. You can then use your accumulated points to earn a bonus on your subsequent transactions.

If you're a first-time user transferring any amount higher than $500, you can also key in BUDGET10 to get a $10 bonus on your first transaction.

How do I get started?
For Singaporeans and PRs, you can simply sign up using your SingPass credentials.

Is it safe?
InstaReM is regulated by the Monetary Authority of Singapore (MAS), so you can be rest assured that there are regulatory controls in place to safeguard your money against any misdemeanors or transgressions.

How does InstaReM work?

Once you've signed up for an account and have been approved, you can start transferring money abroad easily. Personally, I would recommend that you opt for the SingPass MyInfo registration if you're uncomfortable with uploading the front and back copy of your NRIC for verification.

With this method, you also get instant account approval instead of having to wait for the InstaReM team to manually approve your documents.

First, check the rates on your dashboard and how much your recipient will be getting on the other side:

Next, click on "Initiate Transfer".

Key in the amount you wish to send / receive on the other side, and add any promo codes (BUDGET10) or redeem InstaPoints here. You'll be able to see the conversion amount and a breakdown of all the fees involved before you proceed.

Once you've filled in your recipient's bank details, authorize and confirm the payment request through OTP verification. Finally, click on "Take Me to the Bank's Website" and add InstaReM as a new payee. Transfer the money and mention the transaction number in the description box.

So go ahead and compare the fees for yourself here, and I hope this helps all of you who have ever needed to deal with sending or receiving money from abroad! Click here to try out InstaReM now.

Disclaimer: This post contains affiliate links. In line with my advertising policy (which you can review here), I only promote and recommend stuff that I personally benefit from AND which I feel my readers will get great value from. Until the next challenger appears on the scene, InstaReM is one of the options I would recommend right now to anyone looking to send or receive money from abroad.

With love,
Budget Babe

Friday, 11 January 2019

Why I'm on Team Cashback instead of miles credit cards

The war is officially on for cashback vs. miles credit cards, and I'm standing up for Team Cashback.

It’s no secret that The Milelion and SG Budget Babe are fierce online rivals, ever since he called us cashback folks “evil” and “noobs”. I kid you not. What an insult!

Just a few months ago, he was at it again, arguing why air miles cards offer better value over cashback. He even issued an open #nevercashback challenge on Facebook. I couldn't leave such a good debate unanswered, so here's my take on why I prefer cashback cards over miles:

This was originally written for and published on I have edited the article further since.

Miles give you access to experiences, but you can go further with cashback

The MileLion brings up a fair point that most people probably wouldn’t be willing to spend S$10,000 to buy a First Class seat, but yet be more than happy to claim that with their miles.

But here’s my take:

  • That joy is short-lived (and is over in a matter of hours).
  • Cashback brings you further. Just like how I have no desire for branded bags, I similarly don’t need to experience a First Class or Business Class. When I fly, all I care about is the flight is safe, on time and gets me to where I need to be. Of course, it has to also be reasonably comfortable (economy aisle seats are good enough for me).
  • My idea of a travel experience doesn’t come from flying in a premium class; I prefer travelling via budget or economy any day, and save cashback money for actual sightseeing and other activities when I land instead.

Alas, not all of us necessarily need to experience flying First Class before we deem to have lived our lives to the fullest. There are far more meaningful things in life than chasing miles.

Cash saved from cashback pays you interest while miles lose value over time

Over the years as more people joined the miles-chasing bandwagon (otherwise known as “travel hacking”), the airline industry has responded by making it harder for one to claim a trip using miles.

Just take a look at the Krisflyer frequent flyer programme (arguably the most popular in Singapore) and how often they’ve changed their awards redemption system in the last few years. Even The MileLion himself has acknowledged this - as seen from his post on the horrible devaluations since 2012.

Let’s assume you started collecting miles in 2014, working towards a goal of 215,000 miles so you and your spouse can redeem a Krisflyer Suites experience to London. Even with an air miles card that gives you a generous 4 miles per dollar, you’ll need to spend over $53,000*, or slightly over $1,000 per month for 4 years. Just as you’re about to happily redeem your tickets in 2018, imagine being told that you’re now 21,000 miles short! CAN YOU DEAL WITH THAT DISAPPOINTMENT AND HEARTBREAK?!

My heart can't take such surprises. Old liao. Next!

*You can reduce the amount spent by paying annual fees for the cards and getting a bonus miles for doing so, but you’ll still need to spend a significant amount.

Miles chasers tend to spend more than cashback chasers

The miles game fuels you to spend more and more so you can reach your intended goal. After all, *cues music* You’ve tried so hard, and got so far, but in the end, it doesn’t even matterrr.

As a cashback girl, I spend much less than most of my friends in the miles camp. To make my cashback go further, I put any cash saved into a high-yield bank account that earns interest, therefore giving me even more for every dollar saved. A few months ago, I withdrew from that account to pay just $890 for a pair of Economy flights to London.

Cash-paying customers get priority over miles redemptions

Airlines have limited inventory set aside for miles redemptions, so it’s no surprise  many people end up on the waitlist… or they’ve to take a less-than-ideal flight in order to claim their miles.  

Experiences are also best shared with a loved one.  If you thought redeeming one ticket via miles is already hard enough, try redeeming for two, side-by-side seats on the same flight. Enough said.

However if you pay cash, you get to choose when and how you want to fly.

In addition, the airlines run rather attractive promotions from time to time, when you can snag tickets at a heavily discounted rate. On the contrary, I’ve hardly ever seen them do promotions for miles redemptions!

Miles cards have too many (confusing) caveats

Merchant exclusions on air miles cards are so complicated (and random, if I might add) that there’s even an entire spreadsheet on HardWareZone dedicated to verifying miles rewards across merchants, across banks. If that isn’t tiring, I don’t know what is.

Compare this to cashback credit cards, which are clear on what types of payments do not entitle you to cashback. Payments to government institutions, charitable or religious organisations, trading platforms, AXS, EZ-Link top-ups, and Paypal are typically excluded. I’ve not personally encountered any situation where a cashback card advertises “X% cashback for online spend!” only to say “sorry, your payment at Merchant Y is not under our list of participating retail merchants”.

TL;DR version

In conclusion, here’s my lowdown on why earning cashback is better value than chasing miles:

  • Joy from miles is short-lived; cashback gives you more options
  • You can’t earn interest on your miles, unlike cashback
  • Miles are subject to devaluation year after year
  • Air miles chasing encourages you to spend more and more
  • You’ll often find yourself waitlisted for flight redemptions
  • Miles credit cards come with too many caveats and exclusions

That’s why I’d pick cashback cards over miles cards any day. Cashback gives me the freedom to decide when and how I want to spend the extra cash.

However, that’s not to say a miles card is bad. It really depends on your spending habits and categories. If you have a big-ticket item to pay for, such as a $60,000 wedding restaurant bill, you’re probably better off using a miles card than cashback card (even the most generous 1.6% uncapped cashback card only gives you $960 vs. 240,000 miles with a 4 mpd card, enough for a pair of economy class tickets to the U.S.)

But for someone who has no desire to fly premium, then cashback cards truly offer you better value. Still think miles are ALWAYS better? I disagree.

Cash will (almost) always be king. #teamcashback

With love,
Budget Babe