The terms “wire transfer”, “bank wire”, and “to wire money” have become expressions we use to refer to any act of sending or receiving money electronically. However, this is imprecise language. So, what actually is a wire transfer? And how long does one take?
In this article, we’re going to tell you what you need to know about wiring money – from the time it takes to what you’ll need for the process.
What is a Bank Wire?
A wire transfer is a term – used mainly in the US – to refer to an electronic payment through an international system such as SWIFT or Fedwire. By its specific definition in the US, it is an electronic cash transfer between banks that does not go through an automated clearing house (ACH).
In the UK, the same process is more likely to be called a “bank transfer”. Rather than going through an ACH system like BACS, which can take up to three days, a wire transfer is more direct. It is, theoretically, quicker too.
You instruct your bank of the transfer you want to make, including the sum and the details of the recipient – whether domestic or international. Your bank then informs the receiving bank of your instructions. Subsequently, the banks facilitate the payment, sometimes through an intermediary if they don’t have a direct relationship.
It’s one of the oldest ways to send money electronically – and takes its name from the telegraph lines through which the instructions for money transfers would cross America in the nineteenth century.
These days, though, if someone asks you to “wire money” to them, you might want to ask for more details. They could mean this specifically, or they could be talking about BACS payments, or even something like PayPal. The term now covers pretty much all electronic cash transfers.
Are Bank Wire Transfers Instant?
Whilst they aim to be quick, unfortunately the answer is no: wire transfers are not necessarily instant.
Rather, speeds depend on the country in which you are making the payment and that to which the money is being sent. Payments can take anywhere between a couple of seconds and five days to be processed.
How Long does a Wire Transfer Take?
Wire transfers are processed on the day they are received. If you request the transfer after the cut-off time – usually about 5pm – or at the weekend, then it will be processed on the next working day.
If the transfer is domestic, you can expect the funds to appear in the recipient’s bank account within the day – two at the maximum. International transfers take a little longer, usually up to about five days.
The reason it takes so long is because, through the SWIFT system, it is the information of the requested transaction that is transferred first, before any money has been moved at all. This keeps the process slow, yes, but it also makes it much more secure. Lower speeds minimise the chance of fraudulent payments – which is good, because it’s difficult to undo a payment once it has been processed.
How Much does a Wire Transfer Cost?
The other thing about wire transfers is that they are not free. Whilst costs differ from bank to bank, in the US you can expect to pay between $25 and $50 in total for a wire transfer – depending again on whether it is domestic or international.
Why so much? Usually banks charge a particular rate for processing a payment request. Receiving banks may charge a fee themselves. Meanwhile, if you have requested a transfer across different currencies, the intermediary bank is very likely to charge a conversion fee too.
What is Needed for a Wire Transfer?
For a wire transfer, you will need some specific information. This includes the following:
- Your bank account number and personal details
- The recipient’s name and address – and you may need their bank’s address too
- Their bank details, including account numbers and the type of account they hold
- Their BIC or SWIFT code as well as their IBAN
- The amount you want to transfer
Before you do it though, double check all of your details – and ensure that you trust the person to whom you are sending the money. There is no way of getting the money back once it is received.
You may want to check your specific bank’s fees too – so you know what to expect.
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