You want to send $1,000 to your family in India. Service A charges “no fees” but quietly adds a high exchange rate markup. Service B charges a small fee but offers a better rate. Which one is actually cheaper?
For most NRIs, this scenario feels like a puzzle. Hidden costs in remittances—whether through banks, apps, or online transfer services, make it hard to figure out the true cost of sending money home.
In this guide, we’ll break down fixed vs. percentage-based fees, reveal how exchange rate markups impact your transfer, and show you how to calculate the real value your family receives. By the end, you’ll know exactly which model puts the most rupees in your loved one’s account.
The Two Main Models: Understanding Your Options
Money transfer fees explained simply: Most services follow one of two models:
- Percentage-Based Fees – You pay a % of the transfer amount.
- Fixed Fees – You pay the same charge regardless of how much you send.
But here’s the catch: there’s always a third cost lurking, the exchange rate markup. This is the gap between the mid-market USD to INR rate (what you see on Google) and the lower rate you actually get.
👉 If you ignore the markup, you’re only seeing half the picture.
Deep Dive: The Percentage-Based Fee Model
What it is: Services charge a percentage of your transfer amount, often between 0.5% and 3%.
Pros:
- It can look affordable for very small transfers (e.g., sending $50 to test a service).
- Fees scale with the transaction size, so you’re not locked into a fixed amount.
Cons:
- Costs balloon as amounts increase. Sending $10,000 could mean $100+ in fees.
- Often paired with higher exchange rate markups, making transfers deceptively expensive.
Example: Sending $1,000 with a 2% fee = $20 lost instantly, before even considering markup.
Deep Dive: The Fixed-Fee Model
What it is: You pay one flat fee, say $2 or $5, regardless of whether you send $100 or $10,000.
Pros:
- Predictable and transparent.
- Extremely cost-effective for larger transfers.
- Easier to budget for recurring remittances.
Cons:
- For very small transfers (say $20), the flat fee feels high relative to the amount.
Example: A $2 fee on $1,000 = just 0.2% effective cost, compared to 2% in the percentage model.
The Hidden Factor: Why the Exchange Rate Markup Matters Most
Even if the fee looks small, the exchange rate difference can eat away far more of your money.
- Mid-market USD to INR (real rate): ₹87.80/$1 (as per XE/Google today).
- Service Offered Rate: ₹86.10/$1.
That ₹1.70 gap = ₹1,700 lost per $1,000 transfer.
👉 In most cases, the markup costs more than the fee itself.
The Real-World Test: Sending $1,000 to India (August 2025 Data)
Here’s how different services actually stack up:
| Feature | Typical Percentage Service (e.g., Remitly/Wise) | Typical Bank Wire (e.g., Chase) | Abound |
| Amount to Send | $1,000 | $1,000 | $1,000 |
| Upfront Fee | ~$4 (Variable) | $40 (Fixed, Online) | $1.99 |
| Exchange Rate Offered | ~₹87.10 (Markup) | ~₹85.90 (High Markup) | Blended Rate: ₹100/$1 on first $100 ₹88.10/$1 on next $900 |
| Recipient Gets | ~₹86,751 | ~₹82,464 | ₹89,290 |
| Transfer Speed | 1–2 Business Days | 3–5 Business Days | 6–8 Business Days |
| Total Cost to You | ~$1,012 | ~$1,062 | $1,001.99 (Fee separate) |
Key takeaway: Even with slightly longer transfer time, Abound delivers ₹2,539–₹6,826 more to your family than other services.
The Abound Advantage: Transparency and Maximum Value
Most services advertise “low fees” but hide the real cost in the exchange rate. Abound flips that model:
- Transparent fees: Always just $1.99.
- Best-in-class rates: Close to mid-market, with unique promotional boosts.
- More money delivered: As seen in the comparison, recipients get thousands more INR per transfer.
A Special Welcome Offer: Get an Unbeatable ₹100 for Every Dollar!
To help new users experience the difference:
- Offer: $1 = ₹100.
- Validity: First transfer of up to $100.
- Availability: First 30,000 users only.
👉 That means your first $100 = ₹10,000 straight into your family’s account, risk-free.
Conclusion: Choose the Model That Puts Your Family First
- Percentage fees drain more as you send more.
- Fixed fees are predictable but only part of the story.
- Exchange rate markups are the biggest hidden cost.
With Abound, you get a fair fee, great rates, and unmatched transparency. For new users, the ₹100/$1 offer makes it the best way to send money to India in 2025.
FAQs
Q1: What’s the difference between fixed fees and percentage fees for USD to INR remittance?
Fixed fees are flat charges regardless of amount; percentage fees scale with transfer size. For large transfers, fixed fees are cheaper.
Q2: How do exchange rate markups affect the cost of sending money to India?
Markups reduce the INR your family gets. Even a ₹1 difference per $1,000 can mean ₹1,000 lost.
Q3: Which is the cheapest way to send money from the USA to India in 2025?
Services with transparent fees and low markups—like Abound—consistently deliver the most INR.
Q4: Does Abound offer better exchange rates than banks or other services?
Yes. Abound’s rates are closer to mid-market and beat both bank wires and “zero-fee” remittance apps.
Q5: How can I calculate the total cost of my USD to INR transfer?
Add the fee + the exchange rate loss (markup × amount). Compare services using recipient INR, not just advertised fees.
Q6: Are there hidden fees when sending money from USA to India?
With banks and many apps, yes. With Abound, no—fees are fixed and rates are transparent.
