Banks are defending the money they’re charging for international wire transfers, amid concerns some South Asian migrants are being cheated by high and hidden fees.

A survey from money transfer service Wise suggests nearly 70% of South Asian migrants - about 200,000 people - send money home to their loved ones. More than half send up to 10% of their monthly income.

The funds are used for daily expenses, medical bills, emergencies, and rent or mortgages.

The survey also revealed two thirds don't know the remittance fees big banks charge and nearly 40% of them still use traditional banks for international wire transfers.

Wise New Zealand Manager Tristan Dakin said banks are operating as an “oligopoly” and their fees can be hidden and confusing, with the largest component being the mark-up baked into the currency exchange rate.

“This is not something they’re required to disclose under regulation.”

Dakin claimed banks charge between 2-5% above the mid-market rate, which could cost some migrants hundreds of dollars in fees yearly.

Dr Ramil Adhikari, a South Asian community leader, said that’s a substantial amount in South Asian countries – every dollar lost to remittance fees is a missed opportunity to improve their families’ quality of life.

“Hundreds of dollars in fees could mean a month’s rent in Nepal, a year’s worth of school supplies in India or crucial medical treatment in Bangladesh.”

Adhikari says he would support a regulation that would require banks to disclose their exchange rate margins.

“By knowing the exact fees and exchange rates up front, migrants can compare services more effectively and choose options which can maximize the amount of money their whanau will receive."

The country’s major banks are defending their exchange rates.

A BNZ spokesperson said its margin is competitive and is below the 2-5% range claimed by some as New Zealand market margins.

“Like other international services, we charge a foreign exchange margin to cover costs such as currency risk management, transaction processing, and infrastructure maintenance.”

New Zealand’s biggest bank ANZ said indicative Foreign Exchange rates, and fees relating to international money transfers are on their website and are fees-free to a range of countries.

“Before an ANZ customer sends an IMT, they will have full certainty of their costs.”

Westpac and Kiwibank say they're transparent about their exchange rates, and the associated service and transaction fees.

ASB has also been approached for a comment.