Companies receiving money from abroad or sending payments to other countries can do so in different ways; however, some precautions must be taken to avoid problems with transactions.
The details always matter when it comes to bank transactions. It is no different when sending money from or to Brazil. Many argue that Brazil’s bureaucracy is a discouraging obstacle when considering doing business in the country.
Even though a lot of information needs to be provided, it is not so hard if done carefully and correctly. Some precautions must be taken and it is always advised that remittances are tracked, but it is possible to make foreign payments without having unnecessary problems.
Ways of making international transactions
The easiest way of transferring money to or from Brazil is, of course, delivering it personally. By using this method no fees need to be paid or contracts to be signed. However, there is a maximum limit of BRL 10,000 – or equivalent amount in another currency – and is not usually suitable for companies.
Another option is a bank transfer by payment order. Basically, it consists of going to an agency accredited by the Central Bank and asking for a remittance through a banker. Most agencies from Bradesco, Itaú, Caixa, and Banco do Brasil fit this category. Only the receiver is required to have a bank account in Brazil, but both sender and receiver will be charged for this service.
If both parties hold an account in Brazil, it is possible to perform a direct international transaction. For both cases above, fees vary according to the institution where the payment is being made or received, as well as the amount being transferred. In Brazil, the fees for the person receiving the transfer usually vary from USD 20 to USD 50, while the people remitting payments will probably disburse something between USD 20 and USD 100. Transfers via payment order or via international transaction are more suitable for larger transfers.
Via Western Union
One of the most popular methods for international transactions is via Western Union. The main advantage of this service is that the receivers don’t have to pay anything to withdraw the money in one of the company’s 437,000 service centers, in over 200 countries. Basically, everything is done by the sender: it is up to him to pay the transaction fee and to inform who, where, and how much will be received.
Foreigners living in Brazil must present a CPF and a Brazilian driver’s license (CNH) or a foreigner ID (RNE) to send money to other countries or receive amounts from abroad. Those who do not live in Brazil must present their passports.
Brazil’s Central Bank demands that some requirements are fulfilled whenever this service is used. When sending money from Brazil:
- Transactions involving an amount between USD 3,000 and BRL 10,000 can only be completed if an exchange contract is completed
- Transactions involving more than BRL 10,000 can only be completed if an exchange contract is completed and if the sender owns a deposit account in a Brazilian financial institution
The requirements for foreigners receiving foreign payments in Brazil are:
- Knowing the sender’s name, country of origin and approximate value of the transaction
- People living in Brazil can only receive money from abroad in Brazilian Reais (BRL); therefore, only non-residents in the country can withdraw the money in American Dollars (USD)
Banco do Brasil, the largest bank in Brazil, has an agreement with Western Union, which grants some advantages when receiving and sending money abroad. Any individual willing to receive international payments can go to one of the 5,400 agencies of Banco do Brasil. For amounts above BRL 3,000, an authorization form must be completed by individuals and signed by the agency.
When remitting payments, customers of Banco do Brasil can perform this operation in any agency or online. This service cannot be used to pay for commercial transactions.
Checking that all the information is provided and correct is probably one of the most important parts of international transactions. Completing forms with incorrect information is the easiest way for a remittance to be held up.
The most recurrent case of mismatched information relating to international payments in Brazil refers to Nome Empresarial and Nome Fantasia. They are not rarely seen as synonyms, which can be a costly mistake.
Nome Empresarial is the company’s registered name, as stated in Brazilian regulatory bodies and registries. It is the same as denominação social, nome comercial, or firma empresarial, and was once referred to as Razão Social, but this terminology is no longer used. This name is usually required when filing information for financial transactions.
Nome fantasia is the popular name of the company. It is the same as nome de fachada or marca empresarial.
For example, in Brazil, McDonald’s nome fantasia would be McDonald’s, but the razão social would be Arcos Dourados Comércio de Alimentos Ltda as this is the name of the franchising company responsible for it in Brazil.
IBAN is short for International Bank Account Number. It is a 29 digit alphanumeric identification standard adopted by many countries. However it has only been adopted in Brazil since the beginning of 2013. Banks in Brazil are now obliged to accept IBAN as a valid identification code for accounts.
Many Brazilian bank accounts still do not have an IBAN number, mainly because this change is still quite recent. Since July 2013, financial institutions that need to receive payments from abroad have the obligation to provide their clients an IBAN number. It is expected that the bureaucracy surrounding international payments will be less when this standard is widely recognized in Brazil.
It is important to highlight that IBAN numbers from both sender and receiver must be in the same currency. Otherwise, information will not match and the remittance will not get paid.
Track Your Payment
A transaction made via Western Union can easily be tracked online through their Money Transfer Control Number. But, even if different methods were chosen, it is always important to monitor the money being sent from or to Brazil.
Most banks will not warn the receiver if there is a problem with the information provided. Since most transactions take 24 to 72 hours, it is recommended that you contact the financial institution if the money has not been received within this period to make sure there was not a problem with the remittance or that is was not sent back to the sender.