5 Cheap Ways to Pay Bills Overseas

Whether you need to pay school fees, medical expenses, household or power bills, paying these expenses to a country overseas can be tricky. Here are 5 ways you can reduce the cost of these payments and avoid some of the stress.


How to Pay an Overseas Bill

1. By Credit Card

Giving your credit card details online, or directly to someone you are paying the bill to, means you are likely be charged a fee as a percentage from your bank or card issuer. Usually, it is between 3% and 5%. Importantly, you won't be charged a flat transaction fee on top. 

When this is a good option

This makes it a cost-effective way to pay for small international bills under $200.

Pros and Cons of paying a bill by credit card

Using a credit card is the easiest way to pay for bills in another country. The biggest downside is that the bank fee is usually a percentage of your bill payment. This means for bigger payments, the fee can really add up.

Related Links: Can you use a Credit Card to send money overseas?


2. An International Money Transfer Online

If your biller has a bank account you can pay into, then an international money transfer can be a great option. You can transfer the money into their bank account using a bank or a money transfer company. Be mindful though, many money transfer companies have a minimum transaction size of $1000

When this is a good option

An international money transfer is a good option for larger bill payments above $1000 and when your biller has a bank account you can pay into. If you are using this method, make sure you include your invoice or bill number on your payment so they know it's from you. 

The Currency Shop is partnered with OFX. Use this link to register and enjoy your first two payments fee free (normal fee is $10 for amounts under $10 000)

Pros and Cons of paying a bill via an International Money Transfer

The exchange rate you will get from making an international money transfer will usually be better than Paypal or using a credit card, but there is more work involved. Banks will often charge between $18 to $22 so, for smaller amounts especially, it can be an expensive way to send money overseas for smaller amount

Related Links: How to Find the Best Way to Send Money Internationally



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3. Paypal

Paypal remains the world's largest internet payment company. It is very easy to set up an account and most overseas billers will accept payment from Paypal, making this very handy.

When this is a good option

Paypal is great to pay bills if you already have a Paypal account with money in it. It's also a relatively cost-effective way to pay for smaller bills up to $200

Pros and Cons of paying a bill through Paypal

Paypal is very quick and easy - particularly if you already have a Paypal account. 

Paypal does charge for this convenience though. They charge a flat fee and a percentage of the payment. This won't matter too much for small bill payments under $200 however there are cheaper options for larger amounts.

Related Links: Converting and Sending Currency via PayPal - How does it compare?


4. Western Union

Some view Western Union as outdated, with the emergence of newer online players, such as Paypal and Transferwise, however they still remain a good option in certain situations.

When this is a good option

The biggest advantage of using Western Union is their global reach. They are particularly useful if you need to pay into a country that doesn't have a big banking sector. Payments to some parts of South America, Africa and Asia are almost impossible through a bank but with its unparalleled global reach, Western Union can be a good option.

Pros and Cons of paying a bill via direct debit

The biggest con of using Western Union is the cost. Unfortunately, there is no flat or common fee. The exchange rate, fees and charges all depend on where you are sending the money, how much and how it is being received.

Related Links: What you should know about using Western Union for International Money Transfers


5. Set up a local bank account

These days, most banking can be done online so it can make sense to set up a bank account in the country you are paying the bills to. For example, if you own a property in France and are constantly paying bills in Euros relating to the house, it might pay to set up a French bank account next time you are in the country. 

Once the account is open, you can make an international money transfer to add money to the account and then use it to pay bills as they arise.

When this is a good option

This is a great option when you are a dual citizen or when you often have lots of bills in the same country.

Pros and Cons of setting up a local account

The biggest advantage is saving on common fees and charges that come with paying via credit card or Paypal. It's also so much easier to pay a local bill in a local currency using a local account. The big drawback is the hassle of opening the account and maintaining a balance. This might not even be possible if you are not a resident of the country.

Related Links: Repatriating Money Back to Australia from Overseas


What to consider when paying overseas bills

Here is a practical list of things you should think about when paying overseas bills:

  • How much am I paying? Paypal and credit cards are good for small bills under $200 but not great for larger amounts

  • How often do I need to pay bills? If it's a regular commitment, it might be worth investigating opening a bank account overseas or talking to a money transfer specialist

  • What fees are involved?

  • What exchange rate am I getting?

  • Does the biller give discounts for paying on time or early?


Fee Free Offer

OFX is a trusted partner of The Currency Shop. OFX customers using this link through The Currency Shop will not incur a transfer fee for their international money transfers, regardless of the size of the transaction.

Learn More

Minimum transfer $250. Please note that the receiving bank or intermediary bank may charge fees on transactions.

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