Usually, if somebody asks for a “bank wire,” they want the traditional bank-to-bank transfer. But the term wire transfer gets used for other types of transfers as well, so it’s best to clarify the requirements if somebody asks for a wire transfer.
With a wire transfer, money goes from one bank to another, and then to the recipient’s account. Inside of the United States, that means each party to a wire transfer needs a bank account. To open an account, federal regulations require that banks verify your identity (among other things) and ask for a physical address where you can be found.
Wire transfers are useful because the money moves within one or two days. Within the United States, same-day transfers are possible, and international transfers take an extra day or two.
What about receiving a wire transfer—is that safe? For the most part, yes. Payments are more certain because banks only wire money out if the sender has the funds available, usually within one business day (although exceptions may apply). What’s more, it is very difficult for the sender to pull money back after it’s been transferred.
Wires can be completed in one day, depending on how early you submit your request to send money. It may take several hours for the receiving bank to show the wire proceeds in the recipient’s account—even if the money is at that bank. A bank employee may just need to complete several tasks to make the funds available.
Because the money moves quickly, the recipient should not have to wait for funds to clear before claiming or using the money. In other words, there is usually no hold placed on money received via wire transfer. For anybody selling merchandise or services, a wire transfer is safer than a check. Checks can bounce, and it can take several weeks (or more) to find out that a payment was bad.
It is difficult to bank anonymously within the U.S., which limits thieves’ ability to pull off a scam with a bank wire transfer. You can keep your identity from individuals and businesses to some degree, but law enforcement generally has the ability to find you. Even Swiss banks cooperate with U.S. law enforcement efforts.
Unlike some electronic payments, bank wires cost money. Depending on whether it’s outgoing or incoming, international or domestic, and the type of bank account you own, wire transfers can cost up to $50. Some banks waive incoming wire fees. There may also a limit to the amount you can send.
When you need to send or receive money quickly, a bank transfer or a wire transfer might be the right tool for the job. Wire transfers are immediate, reliable, and safe (as long as you’re not sending money to a thief).
A wire transfer is an electronic transfer from one bank or credit union to another. Learn about the speed, security, and costs of wiring money.
Fexco dedicated account managers advise on the quickest and most secure international payment methods for your particular need. You will also get complete control of the payments process through PayDirect, the FCP online payments system, which contains records of all payment and beneficiary details for future transactions. A specialist team of customer service agents will advise you on timescales for international payments and provide expert advice on the formatting of more complex payments to smaller banks worldwide. Some of the main benefits of the Fexco international payments offering include:
Automatic Payee Notification: Payees receive email notification and confirmation when their payments have been sent.
Popular global currencies like the Euro, Sterling and the US Dollar are regularly traded on foreign exchange markets. This means that transfers in these currencies will normally be completed as quickly as possible. Transferring rare or exotic currencies may take longer to reach your beneficiary.
In November 2017, a new voluntary pan-European instant credit transfer scheme that will bring real-time money transfers across the SEPA region is on course to go live. SEPA instant credit transfers (SCT Inst) is a scheme designed for Euro transactions, based on the existing SCT scheme and the ISO 20022 message standard, that offers 24/7/365 availability, ensuring that funds are made available to a beneficiary account within 10 seconds and, at least initially, allows a maximum transaction amount of €15,000.
Let’s examine the most common factors that play a role in how long an international bank transfer takes:
Account Validation Tool: Our validation tool ensures that bank details are correct before funds are sent. This speeds up the transfer process by greatly reducing the possibility of transfers getting lost in the international banking system.
Development is being driven by innovation within the finance sector as well as new entrants in the FinTech arena. It is clear that collaboration is the way forward. Many long serving financial institutions are still hesitant when it comes to moving from proven legacy systems and are fearful of untested alternatives that promise to speed up the international payments process. However, it is these timid players that will be left behind in a market place that is demanding instant payments. The question, therefore, is when not if, instant international payments will become a reality.
Sometimes the banks receiving the transfer need to confirm the information and funds received as a fraud protection measure. While this is an important compliance measure and in the best interest of all parties transferring and receiving international money transfers, incoming funds may not be accessed by the beneficiary for another one or two days after the funds reach the receiving bank. Larger sums are obviously subject to more stringent, and as a result, lengthy controls.
It’s 2017 and most financial transactions are now completed online. So why is it that transferring finances internationally isn’t an instantaneous process? The simple answer is fraud. With large volumes of payments to be processed through larger sending banks, necessary regulatory procedures mean that there are often delays with the expediting funds from the sending bank’s side. Transfers move in a series of steps which are purposely slowed down in order to reduce the possibility of fraud. Each country has rules surrounding the movement of money through its international borders.
Fexco examines several factors that influence the time it takes for international bank transfers to reach an overseas account.