Making International Bank Transfers: A Guide

Quick answer

• Choose the right method: Compare bank wires, money transfer services, and peer-to-peer platforms for speed, cost, and convenience.
• Gather recipient details: You’ll need their full name, address, bank name, account number, and SWIFT/BIC code.
• Understand fees: Be aware of transfer fees, exchange rate markups, and potential intermediary bank charges.
• Check exchange rates: Compare rates from different providers to ensure you’re getting the best value for your money.
• Verify recipient information: Double-check all details before sending to avoid delays or failed transfers.
• Consider speed vs. cost: Faster transfers often come with higher fees, so balance urgency with your budget.

Who this is for

• Individuals needing to send money to family or friends abroad.
• Businesses making payments to international suppliers or contractors.
• Anyone looking to move funds between their own accounts in different countries.

What to check first (before you act)

• Goal and timeline:
• What to do: Clearly define why you are sending money internationally and when it needs to arrive. Is it for an emergency, a regular bill payment, or an investment?
• What “good” looks like: You have a clear understanding of the urgency and the maximum acceptable delivery time.
• Common mistake: Not having a deadline, leading to choosing an unnecessarily expensive or slow method. Avoid this by setting a firm arrival date.

• Current cash flow:
• What to do: Review your current bank balance and upcoming expenses to ensure you have sufficient funds for the transfer, including all associated fees.
• What “good” looks like: You can comfortably afford the transfer amount plus fees without jeopardizing your essential living expenses or other financial obligations.
• Common mistake: Overestimating available funds and causing a shortfall, potentially leading to overdraft fees or bounced payments. Be conservative with your cash flow assessment.

• Emergency fund or safety buffer:
• What to do: Ensure you have a readily accessible emergency fund to cover unexpected expenses. International transfers can sometimes face delays or require additional information, and having a buffer prevents financial strain.
• What “good” looks like: You have 3-6 months of living expenses saved in an easily accessible account.
• Common mistake: Depleting your emergency fund for a transfer, leaving you vulnerable if an unexpected expense arises. Prioritize your safety net.

• Debt and interest rates:
• What to do: Assess any high-interest debt you may have. Sometimes, it’s financially wiser to pay down expensive debt before making a large international transfer, especially if the transfer isn’t time-sensitive.
• What “good” looks like: You have a clear understanding of your debt obligations and their associated interest rates, and you’ve prioritized high-cost debt.
• Common mistake: Transferring large sums while carrying high-interest debt, effectively paying more in interest than you might save on the transfer itself.

• Credit impact:
• What to do: Understand that most international money transfer methods do not directly impact your credit score in the U.S. However, if you are using a service that requires a credit check or if you are taking out a loan to fund the transfer, it could have an effect.
• What “good” looks like: You know how the method you choose might indirectly affect your credit, if at all.
• Common mistake: Assuming all transfer methods are credit-neutral and not realizing a linked financial product could impact your score.

Step-by-step (simple workflow)

1. Determine the amount and currency:

• What to do: Decide precisely how much money you need to send and in which currency it should be received.
• What “good” looks like: You have a precise figure in both your currency and the recipient’s currency, if known.
• Common mistake: Estimating the amount, leading to under-sending or over-sending funds. Always confirm the exact amount needed.

2. Research transfer providers:

• What to do: Explore different options like traditional banks, online money transfer services (e.g., Wise, Remitly, Xoom), and peer-to-peer platforms.
• What “good” looks like: You have a shortlist of 2-3 providers that seem to fit your needs.
• Common mistake: Using the first provider you find without comparing others, potentially missing out on better rates or lower fees.

3. Compare fees and exchange rates:

• What to do: For each shortlisted provider, check their transfer fees and the exchange rate they offer. Pay close attention to the “mid-market rate” and the provider’s markup.
• What “good” looks like: You can clearly see the total cost of the transfer for each provider, including all fees and the effective exchange rate.
• Common mistake: Focusing only on the advertised transfer fee and ignoring the exchange rate markup, which can significantly increase the overall cost.

4. Gather recipient information:

• What to do: Collect all necessary details for the recipient. This typically includes their full name, address, bank name, account number (or IBAN for some regions), and the bank’s SWIFT/BIC code.
• What “good” looks like: You have a complete and accurate list of all required recipient details.
• Common mistake: Missing a single digit in the account number or an incorrect SWIFT code, which can cause significant delays or failed transfers. Double-check every character.

5. Initiate the transfer:

• What to do: Go to the website or app of your chosen provider and start the transfer process. Enter the amount, recipient details, and your payment method.
• What “good” looks like: You have successfully entered all information and are ready to confirm the transaction.
• Common mistake: Rushing through the input fields. Take your time to ensure accuracy.

6. Fund the transfer:

• What to do: Pay for the transfer using your preferred method, which could be a debit card, credit card, bank transfer, or direct debit.
• What “good” looks like: The payment is processed successfully and confirmed by the provider.
• Common mistake: Using a credit card if it incurs high cash advance fees or if the provider charges a significant fee for card payments.

7. Track the transfer:

• What to do: Most providers offer a tracking number or link. Use this to monitor the progress of your money.
• What “good” looks like: You can see the status of your transfer and have an estimated arrival time.
• Common mistake: Forgetting about the transfer after initiating it. Regular tracking helps you identify potential issues early.

8. Confirm receipt:

• What to do: Once the funds are expected to arrive, ask the recipient to confirm they have received the money.
• What “good” looks like: The recipient confirms they have received the correct amount.
• Common mistake: Assuming the transfer is complete without confirmation. This can lead to misunderstandings if the money never arrives or is short.

Common mistakes (and what happens if you ignore them)

Mistake	What it causes	Fix
Not comparing providers	Overpaying in fees and receiving a poor exchange rate.	Use comparison websites and check multiple providers before committing.
Incorrect recipient details	Delayed or failed transfers, potential loss of funds, additional fees.	Double-check all names, account numbers, and SWIFT/BIC codes meticulously. Ask the recipient to verify.
Ignoring exchange rate markups	Sending less money than intended due to hidden costs in the rate.	Always compare the <em>actual</em> exchange rate offered against the mid-market rate.
Using a credit card without checking fees	High cash advance fees or interest charges can make the transfer very expensive.	Check your credit card’s terms for cash advance fees and interest rates for international transactions.
Not understanding intermediary bank fees	The recipient receives less money than expected due to hidden charges.	Ask your provider about potential intermediary bank fees, especially for larger or bank-to-bank wires.
Sending money for illegal activities	Legal consequences, seizure of funds, and potential criminal charges.	Only use legitimate transfer services for legal purposes.
Not checking transfer limits	Inability to send the full amount needed in a single transaction.	Be aware of daily, weekly, or per-transaction limits set by providers.
Failing to track the transfer	Inability to address issues promptly if the transfer is delayed or stuck.	Use the tracking number provided by the service and monitor its progress.
Not considering the recipient’s needs	Sending money in a currency or via a method they cannot easily access.	Ask the recipient if they have a preferred bank or currency and ensure the method is convenient for them.
Relying solely on speed	Paying significantly more for a transfer that arrives only slightly faster.	Balance speed requirements with cost-effectiveness; not all transfers need to be instant.

Decision rules (simple if/then)

• If the amount is small and speed is not critical, then consider a peer-to-peer platform because they often offer competitive rates and lower fees for smaller sums.
• If the amount is large and security is paramount, then consider a traditional bank wire transfer because they are generally considered very secure, though often more expensive.
• If you need to send money frequently, then look for a service with low per-transaction fees and good recurring transfer options because this can save you money over time.
• If you are sending money to a country with currency controls, then research providers that specialize in that region because they may have better compliance and transfer success rates.
• If the recipient needs the money urgently, then prioritize services that offer same-day or next-day transfers, even if they are slightly more expensive, because meeting critical deadlines is key.
• If you are unsure about the recipient’s bank details, then opt for a service that allows cash pickup because this bypasses the need for precise bank account information.
• If the exchange rate is highly volatile, then consider locking in a rate if your chosen provider offers that option because it protects you from unfavorable fluctuations.
• If you have a credit card with travel rewards, then check if using it for a transfer earns points, but be mindful of any associated fees or interest charges, because the rewards might offset some costs.
• If you are sending money to your own account in another country, then check your existing bank’s international transfer options first because they might offer preferential rates or lower fees for existing customers.
• If the transfer amount is significant, then break it into smaller transfers if limits allow, but be aware of potential cumulative fees, because this can sometimes mitigate risk or bypass certain verification hurdles.

FAQ

• What is a SWIFT/BIC code?

A SWIFT (Society for Worldwide Interbank Financial Telecommunication) or BIC (Bank Identifier Code) is a unique code that identifies a specific bank and its country. It’s essential for international money transfers to ensure funds reach the correct institution.

• How much does an international bank transfer cost?

Costs vary significantly. They typically include a fixed transfer fee, a percentage-based fee, and a markup on the exchange rate. Some transfers may also involve intermediary bank fees. Check with your provider for exact charges.

• How long does an international bank transfer take?

Transfer times can range from a few minutes to several business days. Factors influencing speed include the countries involved, the transfer method used, the time of day, and any weekend or holiday delays.

• Can I send money internationally using PayPal?

Yes, PayPal offers international money transfers. However, it’s crucial to compare their fees and exchange rates with dedicated money transfer services, as they can sometimes be less competitive for larger amounts or specific corridors.

• What is the difference between a bank wire and a money transfer service?

Bank wires are typically initiated through your bank, are very secure, and often used for large sums, but can be slower and more expensive. Money transfer services (online or physical) are often faster, cheaper, and more convenient, especially for smaller to medium amounts.

• Are there limits on how much money I can send internationally?

Most providers have limits, which can be daily, weekly, or per-transaction. These limits depend on the provider, the countries involved, and your verification status with the service.

• What happens if I enter the wrong account number?

If the account number is incorrect, the transfer may be delayed, rejected, or sent to the wrong person. You may incur additional fees to retrieve or redirect the funds. Always double-check all details.

• How do I get the best exchange rate?

Compare the exchange rates offered by different providers against the mid-market rate. Services that are transparent about their fees and offer rates close to the mid-market rate are generally best.

What this page does NOT cover (and where to go next)

• Specific regulatory requirements for all countries. Consult local authorities or financial advisors for destination-specific rules.
• Detailed tax implications of sending or receiving money internationally. Consult a tax professional for personalized advice.
• Investment-specific international fund transfers. Explore resources on international investing and wealth management.
• Using cryptocurrency for international transfers. Research the volatility and security of digital assets.