Wire transfer is one of the most common ways to send money from one bank to another. You can use it to transfer funds locally or internationally. But, one major worry is how long it takes for the funds they send to hit the recipient’s account.
This article will show how long you should expect your transaction to settle and the factors that affect its speed.
How Do Bank Transfers Work?
Wire transfer got its name from the late 1800s when people sent money using telegraph wires. We now do that electronically, but the name has stuck with our current banking industry.
When you send money to another bank, it goes through a communication network such as the Society for Worldwide Interbank Financial Telecommunication (SWIFT), Single Euro Payments Area (SEPA), Fedwire, or whichever one your bank uses. SWIFT is primarily for foreign transfers, while other networks handle domestic payments.
Your banking institution will use the network to send the name, amount and account number to the receiving institution, where an employee will confirm the transaction. Once confirmed, the stated amount will be removed from your account and credited to the recipient’s account.
How Long Does an Internal Bank Transfer Take?
Transferring funds from your account to another account at the same banking institution is usually fast. Expect the transaction to settle within 24 hours or instantly in some cases. A worst-case scenario could be up to three days which mostly occurs due to human error.
How Long Does an International Bank Transfer Take?
Transferring funds to a foreign account takes longer than a domestic one. It could take up to five days to get to the recipient, sometimes longer. This happens because the money may pass through several intermediary banks before getting to the final recipient. Human error and public holidays can also cause further delays.
If you want to be sure, talk to an employee at your banking institution, and they can give an estimate of how long it will take the transaction to settle.
Information Required to Send a Bank Transfer
You need the following information for bank transfers:
- Full name of the recipient;
- Bank name, address and phone number;
- Number of the recipient’s account and the type of account (savings or checking);
- Routing number for domestic transactions;
- BIC/SWIFT code for foreign transactions, e.g., HBUKGB4BXXX is an HSBC SWIFT code.
A routing number is a nine-digit code that banks use to identify each other domestically. This is usually determined by the branch where the recipient opened their account.
A SWIFT code, or BIC code, is a unique number assigned to every bank connected to the global SWIFT messaging system. You will need this if you are sending funds internationally.
Factors Affecting the Speed of Translation
Time of Day
Banking organizations usually have a specific time when they stop processing wire transactions. For instance, if the time is 2:00 pm, then any transaction initiated after that time will be processed the next day. Different organizations have different times, but the general rule is that the earlier, the better.
Also, remember that wire transactions aren’t processed on weekends or holidays when banks are closed.
Destination
The country you are sending funds to matters. The transaction will be faster if it is a country that is closer to yours and slower for a faraway country. For example, sending cash from the U.K. to Belgium will be faster than sending it to Rwanda. Time zones in different countries also affect how long it will take to confirm the payment on the recipient’s end.
Payment Method
The method your financial organization uses to process the wire transfer also matters. For example, SWIFT transfers can take longer because the two banks may not be connected directly, so the cash will have to go through an intermediary bank to get to its destination. Domestic systems like Fedwire are usually faster.
Conclusion
Several factors affect how long it will take for a bank transfer to settle, which we have listed for you. We have also given you a hint of how long you should expect a payment to settle. Initiating a wire transaction is easy; you can visit your local branch or use an online banking provider like Silverbird.
