How to Send Money from India to Germany for International Students

Reasons Why People Send Money from India to Germany

Germany is very welcoming to students and it’s often cheaper than other countries. Many German public universities don’t even charge any tuition fees for local and international students. Most public universities in Germany don’t charge a penny of tuition fees and offer undergraduate programmes for free. Yes! You read that right. Totally free of tuition fees. 

Additionally, there are costs like 

• Administrative fees, 
• Living costs like rent and food, 
• Health insurance, 
• Transportation, 
• Utilities.

Families often transfer money to pay for these expenses, ensuring that their children can focus on their studies without any financial worries. There are multiple factors that affect the actual cost of living of an international student in Germany like chosen city and lifestyle. Below is a tentative overview of the cost of living as an international student in Germany:

Major Expenses	Cost
Tuition fees	INR NIL – INR 17,00,000 per year
Accommodation	INR 22,000 – INR 71,000 per month
Food & Groceries	INR 17,000 – INR 35,000 per month
Travel	INR 4,000 – INR 7,000 per month
Healthcare & Insurance	INR 7,000 – INR 8,000 per month
Utilities	INR 8,000 – 13,000 per month

Note: The figures mentioned in the table are approximate. They may vary by location and currency exchange rate. Last updated on 29th April 2024.

Easy Methods for Sending Money to Germany

Before exploring different methods for send money from India to Germany, the first thing that demands consideration is sending money for education purposes from India to Germany is subject to certain regulations and tax implications.

The Reserve Bank of India (RBI) has issued a Liberalized Remittance Scheme (LRS) wherein it is mentioned that Indian residents, including students, can remit a maximum of USD 250,000 per financial year (April-March). This limit includes tuition fees, living expenses, accommodation, and other related costs.

Further, effective from October 1, 2020, TCS (Tax Collected at Source) is levied on foreign remittances for educational purposes under LRS. Tax rates for TCS are as follows:

• 5% TCS on amounts exceeding INR 7,00,000 per financial year
• 0.5% TCS on amounts exceeding INR 7,00,000 per financial year if remittance is made through an educational loan.

Send money from India to Germany can be done through several methods, each offering different advantages in terms of speed, cost, and convenience. Here are the options available. Evaluate your specific needs and preferences to select the most suitable option for your international money transfer.

1. Bank Transfers (Wire Transfers)

Wire transfers are Electronic Funds Transfer (EFT). You can transfer money using SWIFT transfer if you have a savings account.

Procedure:

1. Visit a bank or use the bank’s online service
2. Provide the recipient’s details (name, International Bank Account Number, SWIFT Code, etc.)
3. Specify the amount to be transferred
4. Confirm exchange rates and fees
5. Authorize transfer

Processing Time:

Transfers typically take 2-5 business days. 

Costs:

• Transfer fees may range from INR 500 to INR 1500.
• Exchange rates margins and other taxes may also apply.

Advantages:

• Secure and reliable
• Direct deposit into the recipient’s bank account

Disadvantages:

• Fees are higher compared to other methods of remittance.
• Exchange rates may be less favourable.

2. Online Money Transfer Services

There are multiple options available in online money transfer services. HiWiPay is among such options to send money from India to Germany for international students.

They allow swift transfers with flexible payment options.

Procedure:

1. Create an Account on the website or through the app
2. Enter the amount to be transferred and other details
3. Digitally sign the A2 form
4. Confirm the amount including TCS to generate challan
5. Make payment via any of the available payment methods.

Processing Time:

Transfers typically take place under 24-48 hours. 

Costs:

Online remittance transfer platforms generally charge 1%-2% markup and transaction fees. The rates are competitive and with generally minimum margins.

Advantages:

• Lower fees as compared to other methods
• Better exchange rates
• Fast and convenient
• Easy tracking

Disadvantages:

• Some of the services may have a limit on the amount that can be transferred

3. Forex Cards

There are multiple types of forex cards that can be used to send money from India to Germany for international students.

Procedure:

1. Get a Forex card from a bank or Forex service provider.
2. Load the card with the desired amount in INR. The amount will be converted into Euros based on the prevailing exchange rate.
3. Activate the card as per the instructions and start using the card immediately.

Processing Time:

Forex cards can be used immediately once the card is loaded with funds. 

Costs:

Forex card costs include ATM withdrawal fees, currency exchange fees, etc. which may vary depending upon the issuer of the card and the type of card.

Advantages:

• Enhanced Security
• Better monitoring

Disadvantages:

• Multiple fees included
• Unfavourable exchange rates

4. International Demand Drafts

International demand drafts are now a less commonly used method of remittance since they involve additional steps and fees compared to electronic transfers.

Procedure:

1. Visit the designated bank branch
2. Fill out the form and provide the recipient’s details
3. Submit necessary documents
4. Pay the draft amount along with associated fees

Processing Time:

Transfers typically take place under 3-5 business days. Time may vary depending on factors like the bank’s processing time, courier services, etc.

Costs:

Fees for transfer may vary from bank to bank, and the amount being transferred. 

Advantages:

Secured and reliable

Disadvantages:

• Fluctuating exchange rates
• Not suitable for urgent situations.

Things to Consider While Making Forex Payments 

While making any remittance abroad, there are multiple significant factors that merit consideration. The key considerations to ensure a smooth, cost-effective and secured transfer are:

• Exchange Rates: Check the exchange rates as they tend to fluctuate frequently. Also, banks and transfer services sometimes add a margin to the exchange rate prevailing in the market. It is advisable to compare rates from different service providers.
• Fees and Charges: There are multiple fees included in the forex payments.
• Transfer Fees: This fee varies depending on the providers. While some charge a flat rate, others can charge as a percentage of the amount being transferred.
• Receiving Fees: In some cases, the recipient’s bank may also charge a fee for receiving funds.
• Hidden Fees: Be aware of the hidden fees that may be charged or included in the exchange rate margin.
• Transfer Speed: Different providers offer varied transfer speeds. While some transfers can be instant, others may take multiple business days. Be cautious when there’s an urgency to transfer funds, such as tuition fees.
• Transfer Limits: Check if there’s any minimum or maximum limit on the amount that can be transferred. This limit can also be applied to a certain period of transfer, say hours or a day.
• Security and Reliability: Ensure that the provider is trustworthy. It should have a robust system in place to patch vulnerabilities and prevent fraud or unauthorized transactions.
• Regulations and Compliance: Always ensure that the transfer is in compliance with local and international regulations governing forex transactions.
• Convenience: User-friendliness of the provider’s platform should also be considered. Check if the provider has customer support in place.
• Tax Implications: Understand any potential tax liabilities that may arise due to currency gains or losses.

Tax on Sending Money Abroad from India

While making international transfers, taxation in the form of TCS i.e., Tax Collected at Source comes into the picture. Always make informed decisions as they have an important impact on educational expenses and related remittances that you make. 

TCS or tax collected at source is a charge levied when a resident sends money overseas. The threshold limit and rate for TCS are mentioned under the Liberalised Remittance Scheme or LRS as also mentioned above.

Under the LRS, the TCS rate has been increased from 5% to 20%, effective from October 1, 2023.  However, this amendment excludes send money from India to Germany for educational and medical purposes. All expenses that are not directly related to education like personal expenses will attract 20% TCS.

The below-mentioned TCS rates are applicable when you send money from India to Germany for International students:

Amount of Remittance	Purpose	TCS Rate
Below INR 7 Lakhs	Education	NIL
INR 7 Lakhs or more	Education (Not through Education Loan)	5%
INR 7 Lakhs or more	Education (through education loan)	0.5%
Below INR 7 Lakhs	Other than Education and Medical Purposes	NIL
INR 7 Lakhs or more	Other than Education and Medical Purposes	20%

Note : Click here to understand more in detail.

Seamless Financial Solutions With HiWiPay Money Transfer

When you are making an international money transfer to students in Germany, let HiWiPay be your support system. 

With HiWiPay at your side, remittances abroad are now hassle-free. Read below to know what we offer that makes us stand out

• Transparent fee structure and cost-effective
• Secured transfers
• Data security using the encrypted format for documents
• Competitive rates 
• Ensured compliance with regulations
• Faster remittances (mostly transfers take place within 24 hours) 
• No hassle of repetitive paperwork
• Flexible payment methods

How to Send Money from India to Germany

Here are simple steps to send money from India to Germany for international students with HiWiPay:

• Create an Account: Start by signing in with your e-mail or your mobile number and start using our seamless platform right away.
• Enter the Amount and Details: Once you’ve signed up, enter the amount that you wish to transfer in your desired currency and the details about remittance. 
• Verification: Upload the required documents and let HiWiPay verify them.

Once verification is done, your transfer gets done in as little as 24 hours!

Summary

Foreign remittances include legal formalities to comply with. While send money from India to Germany for international students, always ensure that you’re making remittances through secured channels that are cost-effective.

Check out our website or download our app today!

Frequently Asked Questions

References:

Cost Of Studying In Germany: Tuition Fees & Universities

https://leapscholar.com/blog/cost-of-studying-in-germany/. Accessed 30th May 2024

Master Direction – Liberalised Remittance Scheme (LRS)

https://www.rbi.org.in/scripts/notificationuser.aspx?id=10192#2. Accessed 30th May 2024

Sending money abroad for education? Watch out for these errors to avoid 20% TCS

https://economictimes.indiatimes.com/wealth/tax/tcs-on-foreign-remittances-sending-money-abroad-for-education-watch-out-for-these-steps-to-avoid-20-tcs/articleshow/101590487.cms?from=mdr. Accessed 30th May 2024

Understanding TCS on Foreign Remittance for Education

https://hiwipay.com/blog/tcs-foreign-remittance-education/. Accessed 30th May 2024