When you need to send money real quick, one of the best options is a wire transfer as they are immediate, safe and secure. For some really important transactions, wire transfers or checks might be the only options as the funds are available to the recipient almost immediately.
What is a wire transfer and how do they work?
A wire transfer is basically the transfer of money through electronic measures. A traditional wire transfer bounces from one bank to another using a safe and secure network such as SWIFT etc. But the term wire transfer gets used interchangeably for other types of transfers too.
To wire money, you just need to submit the instructions to your bank. You’ll have to provide the correct information about the recipient’s bank account, and you have to fill a form provided by your bank. This constitutes the bank wire.
To receive money by wire, you’ll have to provide your bank account information to the sender. The money generally takes one to two days, but it might take some extra time due to holidays or weekends. The fees are about $40 to send a wire, and $10 or so to receive a wire transfer. These fees constitute the international transfer fee which must be paid beforehand. Using credit card to wire transfer may not be the best option as then you have to pay higher fees and interest rates.
Pros of Wire transfer
- Speed: Wire transfers are popular because the money moves quickly just within one or two days. For international transfers, it may take an extra day or two. Although it has a international transfer fee which is something like a headache to pay but they are fast. The recipient does not even have to wait for the funds to get cleared. It directly reaches their accounts. The processing time involved is really less. It takes only several hours for the receiving bank to display the funds in the recipient’s bank account.
- Alternative of Money transfer services:If you’re not using a bank for international transfer, you can complete the transfer in just a few minutes with the help of services like Western Union and MoneyGram.
Cons of Wire transfer
- Expensive: If you are sending money within your country locally then wire transfer are the safest and cheapest option to exploit. However, if you aresending money internationally then you have to pay a hefty fee as international transfer fee. You should avoid doing it through a wire transfer as it pretty expensive due to this international transfer fee. The banks charge various fixed and variable fees plus hidden fees along with this international transfer fee.
- Security: Generally, wire transfers are safe. But in the event of international transfers, since the transaction involves the bouncing of funds from one bank to another, it may not be so secure after all. Banking hacks are pretty common after all. Hence, wire transfers are susceptible to attacks from various external online predators. Thus it is not all that safe despite the huge international transfer fee.
Hence, wire transfers have their own pros and cons. You need to study them in great detail and use them only if they suit your needs.