OFX Canada: A Comprehensive Exploration of the Global Money Transfer App

In the ever-evolving landscape of international money transfers, OFX has emerged as a key player, boasting 25 years of experience in the financial domain. OFX Canada allows you to send money in over 50 currencies and 190 countries. The company has gone public in Sydney in 2013. It is a globally regulated entity, subject to oversight by more than 50 regulatory bodies over the world. This regulatory adherence involves frequent audits, compliance with industry guidelines, and strict adherence to legislation. OFX might be one of the best ways to send money abroad, but is it the best for you?

OFX Registration

OFX simplifies the money transfer process into three user-friendly steps. The first involves registration, verification, and login. Users are required to provide basic personal information and additional verification documents. This initial step ensures a secure and compliant onboarding process.

To create my OFX Canada account, I had to select my country, create my ID and password and choose a security question. Then I entered my name, date of birth, address and phone number.

They also asked for my occupation and they wanted to know how much and which currency I would mainly transfer, which I would have liked to skip to make the registration process faster. We also have to agree to their 2-step verification process, their privacy policy and terms and conditions to continue.

Then I entered the identity verification process. This is done with a passport, driver’s licence, national identity card or residence permit. I went with my driver’s licence. I also recorded a video of my face. Overall, it was a pretty standard ID verification process. I waited approximately 10 minutes before I got the confirmation and could make my first transfer.

Connecting my bank account to OFX Canada

To connect my bank account, so that OFX can withdraw funds from my account whenever I make a transfer, I went into my settings in the app. I entered my branch, institution and account numbers.

It takes 2 days to get a small deposit from OFX in your account and confirm the amount received to complete the process.

It is also possible to add recipients in advance. You have to enter similar details including their bank routing number and account number. You can choose the SWIFT code instead.

Unpacking the costs

Understanding the dynamics of interbank rates is crucial for anyone involved in international money transfers. Interbank rates, the official live conversion rates for currency pairs, are subject to constant fluctuations, making it imperative to assess the charts before initiating a transfer. Traditional banks often charge substantial margins, up to 5%, on top of interbank rates, resulting in potentially significant additional costs for consumers. 

OFX, however, prides itself on substantially lower margins, translating to more savings for users. For instance, I checked the data in the OFX app and on a third-party website and there was only a 0.0003 difference as shown in the images below (0.6830 on OFX vs 0.6827). However, OFX doesn’t post customer fees on the site. You need to create an account and log in to see how much your transfer will cost. 

OFX distinguishes itself by not charging fees for account creation or maintenance, providing users with a cost-effective alternative to traditional banks.

OFX leverages a Global Banking Network (GBL), featuring 115 bank accounts worldwide, to facilitate currency reserves and expedite secure and rapid transfers. Unlike traditional banks and other money transfer entities, OFX operates exclusively online and over the phone, eschewing retail outlets and the associated costs. The GBL system not only safeguards against currency exposure but also enables OFX to provide same-day transfers 24/7, 360 days a year, even during times of heightened currency volatility.

Available currencies on OFX

OFX Canada offers most major currencies. Below is just a taste; you will also be able to find dozens more, including Indian Rupees, Vietnamese Dong and Bulgarian Lev.

OFX Canada is best for global money transfers of $10,000 or more

Upon making my first transfer, I tested the app with a small amount of $10 CAD to 6.79 euros. My rate was 0.679 and OFX charged a transfer fee of $15. This transfer fee applies to any transfer of less than $10,000.

Please note that any transfer has to be between 2 different currencies. It is impossible to transfer money from CAD to CAD, for instance.

How to make a transfer with OFX

OFX provides a range of transfer options, enhancing flexibility for users:

• Spot Orders: That’s a regular transfer. OFX facilitates transfers at the current exchange rate.
• Limit Orders: They allowe users to set a target rate, and when reached, OFX initiates the transfer, with a maximum duration of six months.
• Forward Contracts: This is a risk management tool, enabling users to lock in a rate for an agreed-upon amount within a range of two days to 12 months. It is not available to everyone and you may have to pay in advance.

OFX caters to a diverse array of users, serving both individuals and businesses with various financial needs. Delivery of funds will take 1-2 business days in most cases. For individuals, it is useful for buying property abroad, sending money to family, paying international invoices, importing luxury goods, or transferring savings between international accounts. For businesses, it facilitates payments to suppliers, settling international invoices, and managing currency risks through the use of forward contracts.

For example, transferring a $10,000 lump sum to a savings account abroad with a limit order that targets the exchange rate you want would be a great way of lowering the costs. Snowbirds living in Florida 3 months per year might want to try this strategy!

OFX Canada benefits and drawbacks

In conclusion, OFX Canada stands as an efficient and cost-effective solution for individuals and businesses engaged in international financial transactions. With a robust regulatory framework, a global banking network, competitive exchange rates, and innovative transfer options, OFX has positioned itself as a reliable company.