Foreign Exchange Rates (FX Rates) are important in international banking, and the terms OUR, BEN, and SHA are synonymous with international business transactions.
What exactly do these acronyms mean? What are the OUR, BEN, and SHA charges?
Let us dive in!
OUR, BEN, & SHA Charges
- OUR (We pay): If you choose OUR, you pay all fees for sending money internationally. This includes exchange rate fees and any charges from middle banks.
- BEN (You pay): With BEN, the person receiving the money pays all fees. This includes exchange rate fees and charges from middle banks, which means they get less money in the end.
- SHA (Shared): SHA splits costs. Both the sender and receiver pay their own bank fees. Exchange rate fees and middle bank charges are divided between them.
#1 Foreign Exchange Rates
Here we can explain with an example:-
OUR (We pay):
- You send $1,000 internationally using OUR.
- Exchange rate fee: 2% ($20).
- Intermediary bank fee: $15.
- Total deducted from your account: $1,035 ($1,000 + $20 + $15).
BEN (You pay):
- Someone sends you $1,000 internationally using BEN.
- Exchange rate fee: 2% ($20).
- Intermediary bank fee: $15.
- You receive $965 ($1,000 - $20 - $15).
SHA (Shared):
- You send $1,000 internationally using SHA.
- Your bank fee: $10.
- Recipient's bank fee: $5.
- Exchange rate fee (shared): 1% ($10).
- Intermediary bank fee (shared): $10.
- Total deducted from your account: $1,035 ($1,000 + $10 + $10).
- Recipient receives: $985 ($1,000 - $10 - $10).
#2 Process Differences in OUR, BEN & SHA charges
Process Differences in OUR, BEN & SHA Charges table { width: 100%; border-collapse: collapse; } th, td { border: 1px solid black; padding: 10px; text-align: left; } th { background-color: #f2f2f2; }
| Aspect | OUR (Remitter Pays) | BEN (Beneficiary Pays) | SHA (Shared Charges) |
| Definition | Remitter covers all charges | Beneficiary covers all charges | Charges split between remitter and beneficiary |
| Sender's Bank Fees | Covered by remitter | None | Covered by remitter |
| Intermediary Bank Fees | Covered by remitter | Deducted from the remitted amount | Split or deducted from remitted amount |
| Beneficiary's Bank Fees | Covered by remitter | Covered by beneficiary | Covered by beneficiary |
| Amount Received by Beneficiary | Full remittance amount | Remittance amount after deducting charges | Remittance amount after deducting beneficiary's bank fees |
| Preferred When | Ensuring the full amount is delivered | Beneficiary agrees to bear charges | Both parties agree to share the costs |
| Common Usage | Business transactions requiring specific amount | Personal payments, some business payments | Standard business transactions |
| Transparency | High, total cost known upfront by remitter | Lower, as beneficiary may receive less | Medium, with both parties aware of their respective charges |
#3 Hidden Costs for business outward remittance
Hidden Costs in Business Outward Remittance from India table { width: 100%; border-collapse: collapse; } th, td { border: 1px solid black; padding: 10px; text-align: left; } th { background-color: #f2f2f2; } td[colspan="2"] { font-weight: bold; background-color: #e6e6e6; }
| Charge Type | Cost Range (USD) |
| BEN (Beneficiary Pays) |
| Intermediary Bank Fees | $10 - $50 per intermediary bank |
| Exchange Rate Markups | Up to 2% of the remitted amount |
| Unexpected Local Bank Fees | $10 - $30 charged by the beneficiary’s bank |
| OUR (Remitter Pays) |
| Higher Initial Charges | $20 - $75 |
| Intermediary Bank Fees | $10 - $30 |
| Exchange Rate Margins | Up to 1.5% of the remitted amount |
| SHA (Shared Charges) |
| Split Fees Uncertainty | $20 - $60, divided between both parties |
| Multiple Intermediary Fees | $10 - $30 per intermediary bank |
| Exchange Rate Differences | Up to 1.5% for each party involved |
| General Hidden Costs |
| Compliance and Regulatory Fees | $5 - $25 per transaction |
| Service Charges | $10 - $20 additional processing fees |
| Delayed Payment Fees | $5 - $15 for delayed processing |
| Additional Correspondent Bank Fees | $10 - $50 per correspondent bank involved |
#4 OUR, BEN & SHA charges for different Payment Methods
OUR, BEN & SHA Charges for Different Payment Methods table { width: 100%; border-collapse: collapse; } th, td { border: 1px solid black; padding: 10px; text-align: left; } th { background-color: #f2f2f2; }
| Payment Method | OUR (USD) | BEN (USD) | SHA (USD) |
| Wire Transfer | $20 - $75 | $10 - $50 per intermediary bank | $20 - $60 total, divided |
| SWIFT | $25 - $100 | $15 - $50 per intermediary bank | $25 - $70 total, divided |
| Online Payment Services | $10 - $40 | $5 - $30 per intermediary bank | $15 - $45 total, divided |
| Bank Drafts | $15 - $50 | $10 - $40 per intermediary bank | $20 - $55 total, divided |
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