Bank Wire Transfer Process

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Wire transfers are fast and reliable ways to send and receive money. In domestic transfers, the money is typically available to the receiver within hours. For international transfers, availability is often within two days. Wire transfers also can be convenient; many banks also allow customers to initiate them online or via phone.

Mechanics

Wire transfers work via electronic instructions between banks. For example, suppose Suzy who banks in Connecticut wants to send $2,000 to Mike, who banks in California. When Suzy initiates the transfer, her bank electronically debits her account for the $2,000 and sends an electronic signal to Mike's bank to add $2,000 to his account. Mike's money will be available as soon as his bank receives and interprets the signal.

International wire transfers are a little more complicated because U.S. banks have direct relationships with some, but not all, foreign banks. In the absence of a relationship, banks use an intermediary, known as a correspondent bank, with whom they have a relationship to complete a transaction. For example, suppose Pierre in France wants to send $5,000 to Marie who banks in New York. Pierre will initiate the transaction at his bank in France, which will debit his account, but because his bank doesn't have a direct relationship with Marie's bank, it will send the crediting information electronically to a correspondent bank. The correspondent bank will then send the information to Marie's bank, which will make the funds available to her. In some cases, banks use a string of correspondent banks to complete a transaction.

Sending

Your bank typically will offer precise instructions on how to send a wire transfer, along with deadlines for same-day processing. In general, however, follow these steps:

  • Get the recipient's bank account number and her bank's routing number.
  • Go to your bank's local branch, call its customer service department or go online to enter the information. 
  • Many banks charge a fee for sending wire transfers.

International Wiring

For an international wire transfer, in addition to the routing and bank account numbers, you'll also need the recipient's IBAN number, which is 34 alphanumeric characters used for identifying international bank accounts. For international transfers to small banks or to brokerage accounts, you'll need to use a phrase such as "for the benefit of" to indicate the recipient. For some international transfers, you'll also need the receiving bank's Society for Worldwide Interbank Financial Telecommunication, or SWIFT, code.

Receiving

If you're to receive a wire transfer, accurately record your routing number and bank account number to give to the sender. If you're expecting an international wire transfer, get any particular wording that must be used to help the transfer move quickly through corresponding banks and into your account. U.S. banks don't use the IBAN system, so if you have a U.S. bank account, you don't need this information to receive money wired to you. Factor in any fees your bank charges for receiving wire transfers.

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