At A Glance
Sending money internationally is a common need for individuals and businesses in today’s globalized world. Banks remain one of the most established methods for cross-border money transfers. This blog will offer a quick guide on sending money across borders using your bank.
Using your bank comes with its processes, costs, and considerations. Let’s explore what to expect regarding fees and timelines, and how to make the most of your transfer.
Why Use a Bank for International Money Transfers?
Banks have long been the default choice for sending money internationally. Their established networks, security protocols, and regulatory oversight provide peace of mind for many senders. Here’s why some people still prefer banks:
- Security: Banks are heavily regulated and use secure systems like SWIFT for international transfers.
- Reliability: Funds sent via banks are less likely to be lost or mishandled.
- Direct to Bank Account: Transfers go directly to the recipient’s bank account, ideal for large sums or business payments.
However, it is important to weigh these benefits against the drawbacks, such as higher fees and slower processing times compared to specialized money transfer services.
Also Read: How to Send Money Without Paying High Bank Fees
Understanding International Bank Transfers
What Is an International Wire Transfer?
An international wire transfer is a method of electronically sending funds from one bank account to another across borders. These transfers typically use the SWIFT network, a secure messaging system connecting thousands of banks worldwide. When you initiate a wire transfer, your bank sends payment instructions through SWIFT to the recipient’s bank, which then credits the recipient’s account.
How Do Banks Connect Globally?
Banks rely on networks like SWIFT or equivalents to communicate securely and efficiently. Each bank has a unique SWIFT/BIC code, which acts like an international address. Some transfers may also use intermediary banks, especially if the sending and receiving banks don’t have a direct relationship. This can add to both the cost and the processing time.
Typical Use Cases
- Supporting family or friends abroad
- Paying for overseas tuition or property
- Settling international invoices for business
- Making investments or large purchases in another country
What You Need Before Initiating a Transfer
Before sending money abroad, you must gather specific information and ensure you meet your bank’s requirements.
Essential Recipient Information
To initiate an international wire transfer, you’ll typically need:
- Recipient’s full name (as it appears on their bank account)
- Recipient’s bank account number
- Bank name and address
- SWIFT/BIC code (and sometimes the bank’s address)
- IBAN (International Bank Account Number), especially for transfers to Europe
- Recipient’s address and contact information (sometimes required for compliance)
Additional Requirements
Some countries or banks may require:
- Purpose of the transfer (e.g., family support, tuition, business)
- Recipient’s identification or tax information
- Currency selection (USD or local currency)
Security and Verification Steps
For first-time or high-value transfers, banks may require:
- In-person verification or additional documentation
- Two-factor authentication or secure codes
- Approval from a bank representative
These steps help prevent fraud and ensure compliance with anti-money laundering laws.
A Quick Guide to Sending Money Across Borders Using Your Bank
The process for sending money abroad is straightforward, but attention to detail is critical.
Step 1: Access Your Bank’s Transfer Portal
Most major US banks allow you to initiate international wire transfers through their online banking portals or mobile apps. However, for larger amounts or first-time transfers, you may need to visit a branch.
Step 2: Enter Recipient and Transfer Details
- Navigate to the “Wire Transfer” or “International Transfer” section.
- Enter the recipient’s name, bank account number, bank name, SWIFT/BIC code, and any additional required information.
- Select the transfer amount and currency.
Step 3: Review Fees, Exchange Rates, and Limits
Banks will display the applicable fees and the exchange rate they’ll use for currency conversion. Review these carefully, as they can significantly impact the amount your recipient gets. Some banks also set daily or per-transaction limits for international wires.
Step 4: Confirm and Authorize the Transfer
- Double-check all details for accuracy.
- Confirm the transfer and complete any required security steps (e.g., OTP, security questions).
- Save or print the confirmation receipt for your records.
Step 5: Track Your Transfer
Most banks provide a reference or tracking number. You can use this to monitor the status of your transfer online or through customer service.
Fees, Exchange Rates, and Processing Times
One of the most important aspects of sending money internationally via your bank is understanding the costs and timelines involved.
Typical Fee Structures
Fees for international wire transfers vary significantly by bank and transfer method:
| BANK | INCOMING WIRE FEE | OUTGOING WIRE FEE (USD) | OUTGOING WIRE FEE (Foreign Currency) |
| Bank of America | $15 | $45 | Fee may be waived |
| Chase | $15 | $40 (online), $50 (branch) | Free for >$5,000 (less favorable rates) |
| Wells Fargo | $15 | $25 (online), $40 (branch) | |
| Citibank | $15 | $35 | Waived for premium accounts |
Note: Fees may change, and some banks waive fees for certain account types or large transfers.
Also Read: The Best Method to Send Money to Overseas Bank Accounts
Exchange Rate Markups
Banks often add a markup to their exchange rate, which can be a hidden cost. This markup is the difference between the “mid-market” rate (the real exchange rate you see on Google or Reuters) and the rate your bank uses for the transfer. Markups can range from 2% to over 5%, significantly affecting your recipient’s final amount.
Processing Times
- Standard transfer time: 1–5 business days, depending on the destination and banks involved.
- Same-day transfers: Possible if initiated before the bank’s cutoff time (usually 5–6 PM ET), but not guaranteed.
- Delays: Can occur due to intermediary banks, compliance checks, or errors in recipient details.
Transfer Limits
Banks may impose daily or per-transfer limits, which vary based on your account type, relationship with the bank, and destination country. High-value transfers often require additional verification or in-person authorization.
Tips for Saving Money and Avoiding Pitfalls
Compare Fees and Exchange Rates
Before sending money, compare your bank’s fees and exchange rates with those of other banks and specialized money transfer services. Sometimes, sending in the local currency (rather than USD) can result in lower fees or better rates.
Double-Check Recipient Details
Mistakes in account numbers, SWIFT codes, or recipient names can lead to delays, returned funds, or even lost money. Always verify details with your recipient before confirming the transfer.
Keep Records and Track Your Transfer
Save your confirmation receipt and tracking number. If there are any issues or delays, these will be essential for resolving problems with your bank.
Consider Timing
Initiate transfers early in the day and avoid weekends or holidays, which can add to processing times.
When to Use Specialized Services
Consider specialized money transfer services like Wise, OFX, Western Union, or MoneyGram for smaller amounts, faster delivery, or better rates. These providers often charge lower fees and offer competitive exchange rates, especially for frequent or regular transfers.
Alternatives to Bank Transfers
While banks offer security and reliability, they are rarely the cheapest or fastest option. The rise of specialized money transfer services and digital platforms has transformed the market:
- Wise: Transparent fees, mid-market rates, fast delivery to 70+ countries.
- Gift Cards: Gift cards are not tested much in the US market, but are emerging as a great alternative.
- OFX: No transfer fees, great for large transfers, competitive rates.
- Western Union & MoneyGram: Extensive global networks, cash pickup options, same-day transfers.
- Xoom (PayPal): Fast, flexible funding, multiple delivery options.
These alternatives can be beneficial if your recipient doesn’t have a bank account or needs cash pickup, or if you want to save on fees and get better exchange rates.
Also Read: Impact of Gift Cards on Traditional Bank Transfers
Case Study: Sending $1,000 from the USA to India
Let’s compare what happens when you send $1,000 to India using a central US bank versus a specialized service:
- Bank Wire Transfer:
- Outgoing fee: $40–$50
- Exchange rate markup: 2–5%
- Amount received (after all fees): Typically less than what’s sent through a specialized service
- Delivery time: 2–5 business days
- Wise and similar services:
- Upfront fee: ~$7
- Exchange rate: Real mid-market
- Amount received: Higher than via bank, thanks to lower fees and no markup
- Delivery time: 1–3 business days
This example highlights the importance of comparing all costs, not just the advertised fee, when choosing how to send money abroad.
FAQs on A Quick Guide to Sending Money Across Borders Using Your Bank
Can I send money internationally from any bank account?
Most checking and savings accounts at central US banks support international wire transfers, but you may need to enable the feature or visit a branch for first-time transfers.
What if I make a mistake in the recipient’s details?
Contact your bank immediately. If the transfer hasn’t been processed, it may be possible to cancel or correct it. Otherwise, you’ll need to work with your bank and the recipient’s bank to recover the funds.
Is it safe to send money internationally via my bank?
Yes, banks use secure networks and comply with strict regulations. However, always use secure internet connections and never share your banking credentials.
Are there any tax implications for sending money abroad?
Large transfers may be subject to reporting requirements. Consult your bank or a tax advisor for guidance, especially for over $10,000.
Conclusion
Sending money across borders using your bank is a secure and reliable transfer method, especially for large sums or business payments. However, it’s essential to understand the full cost, including fees and exchange rate markups, and to compare your bank’s offering with specialized services that may provide better value.
To make the most of your international transfer:
- Gather all recipient details in advance
- Double-check fees, exchange rates, and limits
- Track your transfer and keep records
- Consider alternatives for faster or cheaper transfers.
With the right preparation, you can ensure your money reaches its destination safely, efficiently, and with minimal cost.
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