A wire transfer has become one of the most popular options for sending or receiving money. Unlike when you deposit money in someone's account, there is no physical cash movement in this option. Merely the balances in both the accounts are modified. Since the identification of both the parties is confirmed prior to transfer, it is considered a safe method. The popularity of wire transfers can also be attributed to their speed and convenience. The prospect of enabling transfers in a matter of a few minutes from the comfort of your home or office is definitely more attractive than standing in a long queue awaiting your turn.
Wire Transfer--the Process
Although the electronic transfer of money seems simple, there is a specific process in the background. Wire transfers are based on certain rules, and only by adhering to these rules and executing the steps carefully can a successful wire transfer be made. Here is the step-by-step process by which wire transfers take place:
- You have to approach your bank and place an order to transfer a specific amount to a receiver.
- Then the identification of the receiver has to be furnished. Provide the International Bank Account Number (IBAN) of the customer along with the Bank Identifier Code (BIC). These two codes help in confirming the identity of the receiver.
- The bank that initiates the process then facilitates the transfer through safe electronic methods life Fedwire or Swift.
- The transfer is not always instantaneous. Sometimes it takes from a couple of hour to a few days for the amount to show up in the receiver’s account.
Usually, a small amount is charged to the sender as well as the receiver. A fee for the recipient will be deducted from the amount transferred. However, there are bank transfers with the service free for either one or both parties. These transfers without fees usually occur when the sender and receiver have their accounts with the same bank and in the same geographical location.
How Safe Is a Wire Transfer?
As simple and convenient as this option might seem, it doesn’t come free of any disadvantages. One major disadvantage of this method is the fee charged by the mediating bank that acts as a link between the sending and receiving banks. As there are no specific rules, a bank might sometimes charge a fee without the authority of the sender or receiver.
If you process the transfer online and the means of transfer is not secure, then there is a possibility of your personal information's being stolen and used against you.
Hence, while making use of a wire transfer, to send or receive money, make sure it is a secure transaction, as one carried out through a bank's website will probably be. Usually, you will see a sign on the website that the transfer is accredited by some organization. Confirm the authenticity of the verifying organization and the website prior to making any transaction.