There are a variety of reasons you may need to send money abroad. You might be wiring a one-off payment to a loved one in another country, making a deposit on a holiday home, or regularly transferring your pension due to a relocation.
Regardless of your reason, wiring money internationally can be an expensive and time-consuming process with some American banks. Money transfer services can offer a more efficient and affordable option, often with lower exchange rates and fees than banks. They may also allow you to send larger amounts, which can be ideal for covering foreign property costs.
How do you send international wire transfers?
If you’re sending a wire transfer internationally through your bank, you will need to instruct them where to send payment. You can provide the recipient’s details by visiting a branch, calling your bank, or filling out an online form. Fees will vary depending on the bank and the location of the recipient.
Wire transfers through non-bank transfer services tend to come with lower costs. It may also be more convenient to complete the process online rather than visiting your branch in person. You will need to create an account with the organization and wire money online or over the phone. Once you make the payment, the organization will forward it to the recipient’s account.
These services can also offer you more flexibility when it comes to choosing exchange rates. Options include transferring funds at the current exchange rate, which can be quicker and simpler but may cost more.
You can also choose a forward contract. This is ideal if you want today’s competitive exchange rates, but need to transfer funds at a later date, as you can lock-in the current rates for up to 12 months.
You may also be able to opt for a limit order. Nominate your preferred exchange rate, and the transfer service will make your payment as soon as this rate is available. Limit orders can last up to 12 months, but tend to come with high minimum transaction amounts.
Considerations when sending international wire transfers
The Office of Foreign Assets Control monitors international wire transfers sent from the United States. This agency assesses if international payments have any connection to illegal activities, such as money laundering or terrorism. If an international wire transfer appears suspicious, it may be frozen.
To prevent and discourage illegal activity, banks and transfer services also report international money transfers over $10,000 to the IRS. This includes related international transfers that total $10,000 or more. Organizations will also collect information on transfers over $3,000. If you plan on sending a large amount of money abroad, it’s a good idea to consult an accountant first.
Do international wire transfers have fees?
Sending international wire transfers by bank can be expensive. A recent analysis of 40 major U.S. financial institutions found that the median outgoing international wire transfer fee was $45. Costs can also apply when receiving an international wire transfer, with the median fee being $13.
Additionally, banks charge consumers a higher markup than the mid-market rate when converting currency. Banks tend to charge this as a percentage of the total wire transfer amount. Non-bank transfer services can help consumers avoid these expensive markups, with some companies charging customers the mid-market rate.
How long does an international wire transfer take?
International wire transfers should take around two working days, but times vary based on several factors, such as the bank and the destination of the recipient.
Unlike domestic wire transfers, which can reach the recipient’s account in a few hours, international bank wire transfers take longer to process. This is due to more checks, with both the domestic Automated Clearing House (ACH) and its foreign equivalent needing to clear the transfer.
Find out about wire transfers with Brex Cash.
FAQs
International wire transfers are normally made using an international standard known as the SWIFT network. This financial institution allows money to travel in between banks internationally. It assigns every bank a unique identifier code to ensure the transfer always gets to the intended recipient.
What are the disadvantages of international wire transfer? ›
The Cons of Wire Transfers
- High costs. Not surprisingly, there's a price to pay for the convenience of wire transfers. Fees vary depending on factors such as provider or method used (online, over the phone, or in person). ...
- Irrevocability. Once a wire transfer is sent, the issuer can't get the money back.
The IRS does monitor international wire transfers, and that there's an overseas money transfer limit of $10,000¹ before your transfer will be reported to the IRS.
How is international money transfer done? ›
The most common way of wire transfer is through the SWIFT or Society for Worldwide Interbank Financial Telecommunication network. The SWIFT network is a messaging protocol. It has over 11,000 banks in 200-plus countries in its network. This network is used to send information from one bank to another.
How long does it take for an international wire transfer to clear? ›
How long does an international wire transfer take? Within the US these transfers take less than 24 hours to clear. International wire transfers usually take two business days, but depending on the destination and when you send the transfer, it can take up to five days.
What are the rules for international wire transfer? ›
When sending an international bank wire, you will need to provide the recipient's name, address, banks SWIFT BIC, and bank account number, plus the International Payments System Routing Code, for certain countries (you will be prompted for this).
Why would someone do an international wire transfer? ›
There are a variety of reasons you may need to send money abroad. You might be wiring a one-off payment to a loved one in another country, making a deposit on a holiday home, or regularly transferring your pension due to a relocation.
What is the maximum amount you can transfer internationally? ›
How much money can you wire without being reported? Financial institutions and money transfer providers are obligated to report international transfers that exceed $10,000. You can learn more about the Bank Secrecy Act from the Office of the Comptroller of the Currency.
Do I have to pay tax on money transferred from overseas to us? ›
Personal Bank Accounts
If you decide to move back to America after time spent overseas, you may transfer the funds from your foreign bank account to your American bank account. Since this isn't income and is simply moving around your money, you won't have to pay taxes on the transfer.
Is there a limit on how much money you can transfer overseas? ›
While the IRS does not place any limits on the amount of money you can send or receive internationally to and from the US, they do have reporting requirements. For payments of USD 10,000 or more, or multiple smaller payments in a short space of time that add to USD 10,000, these must be reported to the IRS.
Best Ways to Send Money Internationally
- Internationally Money Order. The money order is the oldest preferred form of money transfer. ...
- Online Money Transfer. ...
- Online Wire Transfer. ...
- Bank Drafts or Cashier's Cheques. ...
- Step 1: Check Customer ID. ...
- Step 2: Exchange Rate. ...
- Step 3: Transfer Payment. ...
- Step 4: Money Is Converted And Sent.
The cheapest way to send money internationally is to transfer funds directly from your bank account to a recipient's bank account. Most transfer services charge additional fees for debit card or credit card payments and cash pickups. Credit card payments will incur additional charges from your credit card provider.
What is the difference between Swift and wire transfer? ›
Swift transactions are instructions. Wire transfers are direct payments. When a swift transactions is an instruction to pay ( it van be a different kind of instruction) it causes the generation of an additional payment execution, which can be a wire transfer or some other form of payment.
How do I know if an international wire transfer went through? ›
You can either call your recipient and ask them directly or ask your bank to obtain a trace of the transfer. If the funds have been put into the recipient's account, your bank will be able to let you know.
Why would an international wire transfer fail? ›
Transactions are usually rejected if you have entered the wrong routing number or bank account number. If the transfer goes through, it's possible to initiate wire transfer reversal by the bank to reject the transaction. However, if the money wired was sent to the wrong account and not dismissed, nothing can be done.
Why do international wire transfer take up to 2 weeks? ›
Factor in a potential change in currency and that can delay things further. Human error in the transaction, public holidays and location specific factors can also cause delays. Sometimes, an international wire transfer can take up to three weeks.
Are international wires risky? ›
Wire transfers are generally safe and secure, provided you know the person who's receiving them. If you use a legitimate wire transfer service, each person involved in a wire transfer transaction should be required to prove their identity so that anonymous transfers are impossible.
Is it safe to wire money internationally? ›
Are Bank Wire Transfers Safe? Synonymous with security, banks generally have little to prove in the way of safety and credibility. Therefore, bank wire transfers are indeed a safe way of sending money internationally, provided you know or trust the person or business to whom you're wiring money.
How risky are wire transfers? ›
Are Wire Transfers Safe? In short, yes, wire transfers are very safe. Security lies in encryption technology, which encrypts all data sent over the internet during transmission. This ensures that only authorized parties can access your personal information while it's being transferred from one place to another.
