Transferring money between countries is a breeze thanks to recent advances in the banking system. Cheques, mobile apps, and electronic transfers are just a few ways to send money for different purposes. However, a wire transfer is still the best solution if you want to transfer money quickly and easily. It plays a major role in NRI banking and is often the best way to send money overseas.
What is a wire transfer?
A wire transfer is a method of electronic money transfer between individuals or businesses. When a sender initiates a wire transfer, the money from the sender’s bank is delivered to the payee by the payee’s bank. The payee’s bank acts as a middleman for the payment using a wire transfer.
Here’s how wire transfer’s work
In a wire transfer, the ‘wire’ is a set of instructions sent from one bank to another containing information about the payee and transaction, and confirmation that the funds are available in the sender’s account for clearing.
Almost every bank, including IDFC FIRST Bank, accepts wire transfers. Take note that, in contrast to the majority of other banks, IDFC FIRST Bank does not charge any fees for international wire transfers on NRE Savings Accounts. GST is levied on converted INR amount (gross) according to the receiver’s income tax slab.
A wire transfer can be done in two ways:
Domestic wire transfer: When making a domestic transfer,you will need to provide the following information to your bank:
- Information about the recipient, including full name, phone number, and any other personal information such as email address that might help facilitate the transfer.
- Information about the payee’s bank account, including the bank name, account number, address, and bank identifier.
International wire transfer: International transfers will typically require two distinct details:
- A SWIFT or BIC code: A unique bank identifier code (BIC) indicates a bank’s global location. It is a unique code assigned to each member of the SWIFT network. SWIFT is a worldwide network that facilitates interbank financial transfers. SWIFT members receive a unique identification code to facilitate transfers. It helps locate the receiving bank, and money can be deposited into the individual or business’ account.
- IBAN: IBAN stands for International Bank Account Numbers. It is generally used in Europe to help identify banks. The US doesn’t use IBAN, but if you have an IBAN for a non-US account, it is recommended you include it. Since it identifies the actual account involved in an international wire transaction, an IBAN is distinct from the BIC/SWIFT code.
You should also keep information such as the recipient’s full name, bank details, phone number, and address handy when initiating international wire transfers.
When you set up an international bank wire transfer, whether online, in-person at a branch, or over the phone, you will need to ascertain who will bear the fees associated with the transfer.
Wire transfers have effectively made it faster and simpler to send and receive payments without exchanging any cash. However, remember that once a wire transfer has been initiated, it generally cannot be cancelled. Therefore, ensure that you are familiar with the recipient of the funds.