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I'm moving from Europe to Canada, and considering the high fees for wire transfers (the default, instantaneous, cheap, online method I've always used so far), what is the most economical way to send a small amount of money to a friend, fully electronically (i.e. online)? The aim is that the money goes from my bank account to the friends bank account, with minimal cost and effort on both sides. The amount may be small (<10$). It does not need to be fast.

The friend may be either in Canada or outside Canada. For the USA, the question is answered here and here.

  • If it doesn't need to be fast, can you just write a check? – BrenBarn Jan 18 '14 at 19:33
  • @BrenBarn I have no clue. I'm from Europe and haven't seen a cheque in my life. Is that something I can do completely through internet-banking, with the money deposited in my friends' account automatically? – gerrit Jan 18 '14 at 20:19
  • No, it would be a physical check. I was just wondering why/if you need it to be online given that you don't need it to be fast. – BrenBarn Jan 18 '14 at 20:20
  • @BrenBarn For convenience. Doesn't a cheque mean that the recipient has to physically go somewhere? By "it doesn't need to be fast" I mean the money may take time, not that both sender and recipient have plenty of time. From what I understand how cheques work, they take a non-trivial amount of time from both the sender and the recipient. – gerrit Jan 18 '14 at 20:23
  • In the U.S. at least, many banks offer apps for cell phones that allow you to submit a photographic image of a check instead of demanding that the recipient go physically to a bank office and deposit the check. I don't have such an app but even if I had one, the physical act of walking down my driveway to get the envelope containing the check from my mailbox at the kerb is sometimes difficult to do because of ice or snow or rain or wind.... – Dilip Sarwate Jan 19 '14 at 1:17
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Within Canada, to send money to a friend online, you'd typically use the Interac e-Transfer service offered by most Canadian banks & credit unions. Here's a list of those that support it. My bank charges $1.50 to send money via Interac e-Transfer, and zero to receive. Charges are likely to vary by bank.

FWIW, Interac is a not-for-profit organization & network founded about 30 years ago by some major Canadian banks to facilitate ATM, debit, and other electronic financial transactions within Canada.

It's also possible at some banks to set up another person's bank account as a "personal payee" — at which point the account becomes available as a bill payment candidate in your online banking. I know at least three of the "Big Five" banks have this functionality. I use it at my own bank, but only for payees who also bank at my institution, and I'm not sure if it works between banks. You'll need to ask your candidate banks if they have such a feature, and whether it costs anything. The nice thing about the "personal payee" functionality is that, at least at my bank, there's no cost, so for recurring transfer scenarios it can keep costs down.

To send payments outside of Canada, wire transfers remain an option – but doing so through a Canadian bank may be expensive. There exist some non-bank wire transfer providers that have more competitive fees and exchange rates. PayPal remains an option as well.

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