Want to know how to do a wire transfer? We have you covered
Wire transfer is essentially sending money from one bank to another. Wire transfers are generally used to send money overseas. Let us say you are sending money to your child studying abroad. You ask yourself, how do I send a wire transfer? The answer to your query lies in this article.
We list out five steps on how to make a wire transfer.
1. Choose your bank: Most banks offer wire transfer services. Choose a bank, where you have an account and sufficient funds. Wire transfer services are mostly provided online. Your bank’s website will have a wire transfer option. You would need to log in to internet banking. Otherwise, you may need to visit your bank’s branch. Call up the bank’s customer care if you require more details. Ask them how to do a bank wire
transfer.
2. Get an idea of the fees: Wire transfers involve charges. There will be a flat foreign currency conversion charge. Your bank will mostly not have a remittance charge. In some cases, they may charge a flat fee. Intermediary banks may levy a remittance fee. You will also have to pay service tax on the amount transferred. The tax depends on the transferred amount. It varies between 1 per cent to 0.1 per cent of the transferred amount.
3. Gather all the information you need: You will need some information to do a wire transfer;
- Your bank account number
- The name of the recipient
- The recipient’s bank name and address
- The recipient bank’s SWIFT code
- The recipient’s bank account number
- Any other information your bank requires for wire transfer.
4. Fill up the wire transfer form: Now that you have the necessary information on how to do a wire
transfer, you will have to fill up the wire transfer form. The process can be carried out online or offline. Follow the instructions closely. Make sure that you enter all information correctly. The home currency is automatically selected when you enter the recipient’s bank details. Otherwise, you may need to select the currency. Enter the correct account number so that the money goes to the intended recipient. Once you have filled up the form, you have to pay the required charges.
5. Follow up: Once you have done the wire transfer, keep the receipts. Wire transfers take 24-48 hours. You will be able to track the status of your transfer. As soon as the intended recipient receives the money, the process is complete. Wire transfers are mostly used to send money overseas. Domestic wire transfers take a day. International wire transfers may take up to five days or even more.
We have discussed all the steps regarding how to wire transfer money. Now,
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A wire transfer is a way of moving money electronically between two banks. A traditional money wire goes from one bank to another using a network such as the Society for Worldwide Interbank Financial Telecommunication (SWIFT) or Fedwire.
When you need to send or receive money quickly, a wire transfer might be the right tool for the job. Wire transfers are fast, reliable, and generally safe.
For some big transactions, a wire transfer might be your only option. This is because the funds are available to the recipient more or less right away. If you are buying a house, for example, your settlement agent may require you to use a wire transfer to pay your down payment and closing costs.
Note
A wire transfer can mean any electronic transfer of money. But most often, if someone asks for a “bank wire,” they want a traditional, domestic bank-to-bank transfer.
U.S. consumers can also wire money to people abroad through international wire transfers, also known as remittance transfers. Credit unions and other financial services companies can act as the money transfer provider, not just banks.
Alternate names: money wire, bank wire transfer
How Wire Transfers Work
When you send a wire transfer, you'll provide your bank with information about how much money you want to transfer and where you want the money to go. Once the bank processes the transfer, the money can move fairly quickly.
If you are sending a domestic wire transfer, it often leaves your account and arrives the same day. Since you can only send funds that are in your account, the recipient's bank doesn't need to wait for them to clear. This means the money will be available to the recipient right away. International wire transfers usually take a few business days, depending on the country.
Wire transfers are a safe way to send money. Within the U.S., 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.
This lack of anonymity when banking in the U.S. makes it harder for thieves to pull off a scam with a bank wire transfer than with other payment methods. Scams are more common with personal checks or payment services like PayPal.
What You Need for a Wire Transfer
To initiate a wire transfer, you will need to contact your bank. They will ask for certain information about where the money needs to be sent. This often includes:
- Which bank account you want the money to come from
- Recipient's name
- Recipient's bank account number
- Recipient's address and ZIP code
- Bank name where the money is being sent
- Bank ABA routing number
You may need to fill out and sign a form providing this information in order to initiate the wire transfer.
How Much Does a Wire Transfer Cost?
Unlike some electronic payments, bank wires cost money. The cost may range from $15 to $50 per transfer. The fee depends on:
- The bank
- Whether the wire is outgoing or incoming
- Whether the wire is domestic or international
- The transfer amount
Domestic incoming wires fall at the lower end of this price range. International outgoing wires are the most expensive. Some banks may waive domestic wire transfer fees for certain account types.
Note
Some banks place a limit on the amount you can send in a single transfer or within a single day. But the limit tends to be high. Some banks allow wire transfers of up to $100,000 per day, per client.
Pros and Cons of Wire Transfers
Pros
Quick process
Funds available as soon as transfer is complete
More reliable than checks
Cons
Hard to verify recipient
Beware of mortgage wire scams
Difficult to cancel once in motion
Pros Explained
- Quick process: It only takes a few minutes to set up and initiate a wire transfer. Within the U.S., transfers can often be processed on the same day, depending on how early you submit your request. International transfers take an extra day or two.
- Funds available as soon as the transfer is complete: The recipient doesn't have to wait several days for funds to clear before claiming or using the money. In other words, there is usually no bank hold placed on money received via wire transfer.
- More reliable than checks: A money wire poses less risk of fraud than a checkbecause a sender must already have sufficient funds in their account to initiate a wire.In contrast, checks can bounce, and it can take several weeks (or more) to find out that a payment was bad.
Note
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 need to complete a few tasks to finish the transfer.
Cons Explained
- Hard to verify recipient: If you wire money to a stranger or use a business that pays out cash (such as a retail "money transfer" shop or Western Union), it's harder to verify who got the money. Someone with a fake ID could collect the cash, and it may be hard to track the recipient.
- Beware of mortgage wire scams: Down payments, closing costs, and other wires to a title company can be targeted by hackers. Always verify by phone where the money is supposed to go, especially if you get wire instructions by email.
- Difficult to cancel once in motion: Money transfer providers make it difficult for the sender to pull money back after it has been transferred. International transfers can be reversed in certain situations.
Alternatives to Wire Transfers
The term "wire transfer" is often used for various electronic transfers. In fact, most payments are electronic (even checks get digitized).
These transfers are an option when you can't or don't want to send a wire transfer. Not all of them are as instant or safe as bank wire transfers.
Money Transfer Services
Financial services companies like Western Union operate independently. You can bring cash for an in-person transfer. The amount of time this type of transfer will need varies; it could take a few minutes or a few days.
On the receiving end, the business pays cash to the recipient. The recipient is identified through personal information like their name and address.
ACH Transfers
These are bank-to-bank transfers that move through the Automated Clearing House (ACH) network. ACH transfers usually take one to two days. These transfers can be reversed, but only in limited circumstances.
P2P Payment Tools
Person-to-person (P2P) services are often easy and inexpensive to use. They include PayPal, Venmo, Zelle, and Popmoney. Each tool has different time frames for transfers. Popmoney, for example, enables three-day standard transfers from bank accounts.
They also have different strengths and weaknesses. The one you use may depend on whether you are making a money exchange, repayment, and another type of transfer.
Key Takeaways
- A wire transfer is a way of moving money electronically between two banks, either within the U.S. or internationally.
- Wire transfers usually come with a fee, which ranges between $15 and $50.
- Wire transfers can usually happen on the same day or within a few days, and the funds are available as soon as they arrive in the recipient's account.
- You should always verify where you are sending a wire transfer because the process is difficult to reverse.
Frequently Asked Questions (FAQs)
How do you do a wire transfer online?
Many banks allow you to conduct wire transfers through your online account. In addition to creating an online account, you may also have to sign up for the online wire service. Check your bank's online banking services for more information.
Is there a difference between a wire transfer and a bank transfer?
Although some people may use the terms interchangeably, bank transfers and wire transfers aren't the same. A bank transfer is another name for an ACH transfer, which is a system of sending money bank to bank through the Automated Clearing House. These bank transfers tend to be slower than wire transfers. However, bank transfers work well for services such as direct deposits and direct payments to vendors.
What time of day do wire transfers occur?
Specific processing times for wire transfers vary by bank. Check with your bank for information about cutoff times and when funds will be available for the recipient.