What is a wire transfer?

There are many options available these days for sending and receiving money. And some are as convenient as using a mobile app. One method that’s been around a while? Wire transfers.

A wire transfer is a specific form of transfer in which money is electronically sent from one bank, credit union or financial services company to another.

Key takeaways:

  • A wire transfer—also known as a wire payment, bank transfer or bank wire—is an electronic transfer of funds from one bank, credit union or financial services company to another.
  • Wire transfers don’t require you to have physical cash since the money is transferred electronically. However, the funds being transferred still need to be available.
  • Wire transfers can be a fast and secure way to transfer money domestically and internationally. However, they may also include additional fees.

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How do wire transfers work?

Generally, there are limits to how much money can be sent daily with wire transfers. But the limits are usually high and may have a $100,000 minimum per day, making this one option for large transactions. 

Wire transfers can also have associated fees, often ranging from $0 to $50, depending on the type of transfer taking place. 

Before a wire transfer takes place, it can be wise to have some information prepared ahead of time. The exact information can vary depending on the type of wire, but it might include:

  • Amount
  • Recipient’s name
  • Recipient’s address
  • Recipient’s phone number
  • Account numbers
  • Routing numbers
  • Financial institution’s address

Types of wire transfers

Wire transfers don’t require consumers to have actual cash in hand because the money is transferred electronically. But funds will need to be available in the involved bank account at the time of the transfer.

Wire transfers might come in two forms: domestic and international. Depending on who you’re sending money to or where you’re receiving the funds from, it can be helpful to understand how each works.

Domestic wire transfers

Domestic wire transfers are completed when money is transferred from one bank account to another in the same country. They can take between one and three business days to complete.

Two young women on vacation taking money from an ATM.

International wire transfers

International wire transfers, sometimes referred to as remittance transfers, take place when money is moved from one bank account to another in a different country. For example, sending money from the United States to a family member who lives in Europe would be considered an international wire transfer. 

Sending money to a recipient in a different country may take slightly longer than a domestic wire transfer. International wire transfers can be more expensive, too. 

International transfers may also offer currency conversion options—for example, converting from American dollars to British pounds. But there may be a fee to do so.

How long does a wire transfer take?

The time it takes to send a wire transfer may depend on whether the transfer is domestic or international. Generally, domestic wire transfers take one to three days, while international wire transfers can take two to five business days.

It’s also wise to take into account the effect that weekends, holidays and after-hours transfers can have on how long it takes for the wire transfer to be completed. Reviewing the rules and regulations of the bank or financial service company completing the transfer may help make the process easier.

How to receive a wire transfer

Receiving a wire transfer is fairly simple. But there are still important things to know to ensure you’re fully prepared.

  • Check to see what information or documents are needed from your bank or financial services company in order to receive the funds.
  • Provide the required information to the sender, which can include your name, bank account information, routing number and contact number. You may also need to provide additional information if you’re receiving money internationally. 
  • Prepare for any fees associated with receiving your wire transfer.
  • Keep track of the delivery timeline to receive your wire transfer, especially if it exceeds five business days. 

Wire transfer fees

Wire transfer fees often range from free to $50. But fees can vary depending on whether they are domestic or international wires. International wire transfer fees may be higher because of exchange rates or the cost associated with converting currencies. 

If you’re sending a wire transfer internationally, comparing your bank wire transfer fees with those of other businesses offering wire transfer services may be helpful.

Considerations for wire transfers

Now that you understand the basics of wire transfers, there are a few additional things to remember that can help you avoid errors.

  • It may be a good idea to review the details of your wire transfer before it’s finalized. In most cases, it isn’t possible to revise or cancel wire transfers once they’re initiated. So verifying your bank account information, the recipient's information and the transfer amount are correct can help you avoid any mistakes or delays.
  • Staying away from unfamiliar emails or social media messages urging you to deposit a check or wire money can help you avoid fraud. 
  • A good rule of thumb may be to communicate with the intended recipient to ensure that you both mutually understand the wire transfer details.

Wire transfer alternatives

There are other money transfer alternatives that may be useful to consider.

Automatic clearinghouse (ACH) transfers

ACH transfers are another way to electronically transfer funds. Among other useful functions, ACH transfers can be used for direct payments. This means you can send or receive money to make purchases, pay bills, or send money from your bank account to a friend or family member. 

ACH payments go through a clearing process to protect against fraud, which can extend the time it takes for funds to clear. 

Financial platforms or mobile apps

Financial platforms or mobile apps, such as Zelle®, allow you to send and receive money instantly. While there may be small fees associated with some of these financial platforms, you may also be able to avoid them depending on how fast you’d like to receive the funds.

Wire transfers in a nutshell

There’s no shortage of options for transferring money—whether you’re sending a wire transfer, receiving a wire transfer or using other payment services.

But taking time to understand how each option works can help you keep your money and personal information safe and secure.

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