Wire transfers are a method for sending money electronically between bank accounts. With a wire transfer, you can send money within the U.S. as well as abroad. Here, we’ll explore what wire transfers are, how they work and some of the differences between domestic and international wire transfers.
What is a wire transfer?
A wire transfer electronically transfers money from one bank account to another, offering a direct way to send funds. Some common uses for wire transfers include:
- Purchasing property or making large investments
- Paying international suppliers or vendors for business transactions
- Sending money to family and friends abroad
By eliminating the need for physical cash or checks, wire transfers can provide a simple and efficient way to send money, especially for time-sensitive transactions.
How do wire transfers work?
Wire transfers use encrypted communication systems, like SWIFT (for international transactions), to securely transfer funds between banks. The sender shares the recipient's banking details, and the bank sends payment instructions to the recipient's bank. Payments are typically processed by the recipient's bank within a few business days. International transfers can take longer than domestic transfers.
Steps to wire money
To avoid delays or errors while transferring cash, you must generally follow these steps.
Information needed to initiate a transfer
Here are some details you might need for a wire transfer:
- Recipient's full name: Check if the spelling matches their bank account records.
- Account number: Ensure this is correct.
- Bank name and address: Include the branch details, if asked.
- Routing number (for domestic transfers): Required for identifying banks in the U.S.
- SWIFT/BIC Code: Needed for global transactions.
- Purpose of transfer: Some banks may ask for this, mostly in instances of international transactions.
Accuracy is important – incorrect or missing information might result in delays or failed transactions.
How to complete a wire transfer
You can initiate a wire transfer online, in-person at a bank branch, or through a third-party like a money transfer service or API platform. For in-person transfers, a representative from the bank branch will guide you through the process. Here’s what you’ll likely need to do if you wire money online.
Log into your bank account: If you are transferring the money online, access your bank account via the bank’s website or mobile application.
Select the wire transfer option: Find this feature in the banking menu.
Provide the recipient’s details: Add all the required information, including the recipient's name and account number.
Verify transfer details: Double-check all the information for accuracy.
Confirm the transfer: Submit the transaction.
Domestic vs. international wire transfers
Let’s look at some of the differences between domestic and international wire transfers.
| Aspect |
Domestic Wire Transfers |
International Wire Transfers |
|---|
| Processing Time |
Typically completed within the same business day or by the next day. Weekends, holidays and off hours may prolong the transfer. |
May take 2 to 5 business days due to additional processing steps. Weekends, holidays and off hours may prolong the transfer. |
| Required Details |
Recipient's account number and routing number. |
SWIFT/BIC code, recipient's bank address, and purpose of transfer. |
| Fees |
Generally lower compared to international transfers. |
Include currency conversion fees and higher processing charges. |
| Currency Conversion |
Not applicable. |
Required for transactions in foreign currencies. |
| Purpose of Transfer |
Typically, simple (e.g., payments within the same country). |
May require additional justification for regulatory purposes. |
Can you cancel a wire transfer?
Wire transfers can’t usually be canceled once they are initiated, as the money is already moving from your account to the recipient. However, you may be able to cancel the transfer if it hasn’t been processed yet, though you may incur a fee.
Tips for wire transfers
When wiring money, always double-check all details, since even minor errors might cause delays or send payments to the incorrect account. Try to avoid scams by transferring money only to trusted recipients and being cautious of unsolicited requests or suspicious emails.
Disclosure: This article is for general educational purposes. It is not intended to provide financial advice. It also is not intended to completely describe any Citi product or service. You should refer to the terms and conditions financial institutions provide for various products.
