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How much is lost in fees when receiving payments from abroad in Colombia
How much is lost in fees when receiving payments from abroad in Colombia
A freelancer in Bogotá bills 1,000 dollars and receives the equivalent of 920, with no one explaining where the difference went. Here we tell you at which points in the chain money is deducted, how to calculate your real net, and what to do so that more of it reaches you.
Download the belo app and check how to receive payments from abroad according to your account and current conditions.
Why your payment arrives incomplete
A freelancer in Bogotá bills a client in New York 1,000 dollars, but when they check their account, they receive the equivalent of 920.
Those 80 dollars were absorbed by a chain of intermediaries operating between the moment of sending and the final crediting.
Understanding the fees when receiving payments from abroad in Colombia requires looking at each link in that chain, because the amount leaving the sending bank almost never matches the one reaching the receiving account.
An international transfer has up to four points where money is deducted, and each one operates independently.
Where money is deducted in each transfer
The sender's bank charges a fee to initiate the operation.
If the transfer travels through the SWIFT network (as occurs with most wire transfers between countries that do not share a payment system), it may pass through one or two correspondent banks that also retain a portion.
The receiving bank or platform applies its own fee for receiving the funds.
When the money arrives in dollars and is converted to Colombian pesos, the applied exchange rate usually includes a margin that is not itemized on any receipt.
Each of those costs reduces the net amount, and several of them are invisible until the money has already arrived.
Fees according to the transfer rail
Not all international transfers travel the same path. The "rail" (the network through which the money travels) determines how many intermediaries touch the funds and, therefore, how much they charge for receiving dollars or another currency.
The main rails and how they affect your payments
Rail | How it works | Impact on payments to Colombia |
|---|---|---|
SWIFT (wire transfer) | Global network connecting banks across continents | Multiple correspondent banks can retain between 25 and 50 dollars in combined fees before the payment arrives |
ACH | Regional network, primarily within the United States | Reduces intermediaries when both parties operate in the same system, although the final stretch to Colombia crosses into another network |
SEPA | Eurozone network for transfers between European countries | Minimal or zero costs within Europe, but the stretch between Europe and Colombia relies on correspondents again |
Digital platforms with local rails | They use local networks on both ends to avoid correspondents | They can significantly reduce intermediate fees compared to a SWIFT wire transfer |
The difference between these rails directly translates into the cost of receiving payments from abroad. The sender often chooses the rail without consulting the recipient, and that decision on how the money is transferred defines how much is lost.
How to calculate your real net
To know how much you are actually going to receive, it is convenient to run the calculation before the payment arrives.
Net received = Amount sent - Sender's fee - Intermediary fees - Recipient's fee - Exchange margin
Suppose a client sends 1,000 USD from their bank in the United States. The sending bank charges 30 USD for the wire transfer, a correspondent bank retains 15 USD, and the receiving bank in Colombia charges 20 USD (or its equivalent in pesos).
The available amount drops to 935 USD before the last deduction, which is usually the largest and the least visible.
When those 935 dollars are converted to Colombian pesos, the exchange rate applied by the receiving bank rarely matches the market rate.
If the official exchange rate (TRM) of the day is 4,200 COP per dollar but the bank applies 4,100, that difference represents 93,500 fewer Colombian pesos in the account. In a 1,000 dollar payment, the exchange margin can cost more than all bank fees combined.
That is why international transfer fees in Colombia are not reduced to a single number published on the bank's page.
The real cost is the sum of everything deducted at each link, including that conversion margin that no intermediary calls a "fee" but works exactly like one.
What you can do so that more reaches you
Once you understand where the money is lost, you can act on several points in the chain.
The first variable is the rail: if your client can send through a platform that avoids correspondent banks, you eliminate one or two intermediate deductions. The second is who pays the fees.
In most wire transfers, there is the OUR option, where the sender covers all fees along the way, and it is advisable to explicitly ask the client for it before they initiate the transfer.
The variable with the greatest impact is avoiding forced conversion. If you can keep the funds in dollars instead of automatically converting them to Colombian pesos at the receiving bank's exchange rate, you gain control over when and at what rate to convert.
Some digital platforms allow you to receive international payments without fee and keep funds in the original currency, which separates the moment of collection from the moment of conversion.
At belo, the fee for receiving international payments is 0.5% of the amount (with a minimum that varies depending on the method), significantly lower than the 15 to 50 dollars that a chain of correspondent banks can add up to in a SWIFT wire transfer.
You can manage payments from abroad from the app by checking the conditions before confirming any operation.
There may be external costs depending on the sending bank, the network used, or the origin of the payment, but reducing the recipient's fee to a fixed and transparent percentage already eliminates a good part of the uncertainty.
When you wonder why less money arrived than was sent to you, the answer is almost always in the combination of visible fees and invisible exchange margins that accumulate at each stretch.
Calculating the net before receiving payments from abroad, subtracting each layer from the amount sent, eliminates surprises and allows negotiating based on a real number.
Download the belo app and check how to receive payments from abroad according to your account and current conditions.
Frequently asked questions about how much is lost in fees when receiving payments from abroad in Colombia
How much does a Colombian bank charge to receive an international transfer?
The amount varies depending on the entity, but the receiving fee usually ranges between 15 and 30 dollars or its equivalent in pesos. To that is added the exchange margin applied by the bank when converting the funds, which often represents a higher cost than the explicit fee.
What is the OUR option in a wire transfer and when should it be requested?
The OUR option instructs the sending bank to cover all fees along the path, including those of the correspondent banks. It should be requested when the recipient wants to ensure that the agreed amount arrives in full, without intermediate deductions that depend on third parties.
Is the bank's exchange margin negotiable?
In most traditional banks, the exchange margin is set institutionally and is not negotiated for individual operations. The most effective alternative is to use a platform that allows keeping the funds in dollars and converting them at a separate time, when the rate is more convenient.
How many correspondent banks can a transfer between the United States and Colombia go through?
Generally one or two, depending on whether the sending bank has a direct agreement with the receiving bank. When that direct agreement does not exist, the payment passes through one or more intermediary banks and each one can retain a fee before forwarding the funds.
How do I know what exchange rate the receiving bank applied to my transfer?
You can compare the amount received in pesos with the official daily exchange rate (TRM) on the day of the credit, published by the Banco de la República de Colombia. The difference between that rate and the one applied by your bank is the exchange margin that the intermediary charged without detailing it on the receipt.
