What Is a Wire Transfer?

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Updated on Tuesday, December 10, 2019

There are plenty of reasons you might need to send money from your bank account, and a wire transfer can be an easy way to get the job done. They’re speedy, convenient and can help you make large payments — such as putting a down payment on a home or helping a sick relative with medical expenses — on short notice.

What is a wire transfer?

A wire transfer is the process of sending money to someone, either domestically or internationally, from one bank or credit union to another through their secure systems. Those internal systems include services like SWIFT or Fedwire, but today, wire transfers can also be sent by alternative providers, such as Western Union, TransferWise and MoneyGram.

Completing a wire transfer is pretty straightforward, but there are some key pieces of info you need in order to send one:

  • Your recipient’s full name and address
  • Your recipient’s bank account number and bank routing number
  • The amount you want to wire

Some banks might also require a specific code to identify where you’re sending your money. The type of code you use — including SWIFT codes, BIC codes or IBAN codes — will vary depending on the bank and whether the money is being sent internationally.

Many banks and credit unions allow you to send wire transfers through your account online, while others require that you come in and fill out paperwork. Once all the documents are filled out, the bank will charge you a fee for the service (more on that below) and your money will be on its way.

How long does a wire transfer take?

How long it takes to complete a wire transfer depends on a few factors. Domestic wire transfers are typically sent the same day, but it also depends on how the recipient is receiving the money.

For example, if the recipient chooses to receive the funds at a Western Union location, they may be able to get the wire transfer in just a few hours. Meanwhile, a domestic bank-to-bank wire transfer can take one to two business days.

Sending an international transfer can take several days, depending on your bank and the receiving country’s processing system. To find out exactly how long an international wire transfer will take, check with your specific bank or credit union.

There are also some speed bumps worth watching out for — especially when it comes to international transfers.

  • Western Union’s rules state that funds may be delayed or services rendered unavailable based on the amount sent, the destination country, currency availability, identification requirements and differences in time zones, among other complications.
  • Chase’s Global Transfer stipulates that they process wire transfers through their own internal review process, and they may contact the sender to verify their request. That could delay the wire transfer.

As a result, an international wire transfer could take a few days to show up in the recipient’s account. It may not be an instant transfer, but it’s usually faster than mailing a check.

How much does a wire transfer cost?

The fee for sending a wire transfer varies based on the amount you’re sending, whether you’re using your bank or an alternative provider like Western Union and whether the transfer is domestic or international.

Domestic wire transfers cost $4 at Walmart, which uses the cash transfer service MoneyGram. At some banks and financial services companies, those fees can be a lot higher: Ally charges $20, while Wells Fargo charges $30.

International wire transfers are typically a lot more costly. Banks typically charge about 5% on the daily exchange rate in addition to hefty international money transfer fees, so a $10,000 transfer could cost you up to $500 in fees to your bank, plus other fees.

Some banks and credit unions do not charge a wire transfer fee to their account holders, but there might be stipulations. For example, Chase Global Transfer does not charge a wire fee if their account holder is sending an online wire of $5,000 or more to a bank outside the U.S. in foreign currency.

Keep in mind, too, that you can send a wire transfer through such services as Western Union or TransferWise using money from your credit card, but your credit card company considers wire transfers a cash advance and may charge you cash advance fees and higher interest rates. That’s in addition to the fees you will be charged from whichever service you use.

Are wire transfers safe?

Wire transfers are generally considered to be secure, but there is one major issue to keep in mind: Once you’ve sent the money, you can’t get it back.

Hopefully you’ve never fallen for the “You won a trip, now wire us a deposit to hold your spot!” scam and you’re always sending your wire transfer to someone you know and trust, but there are also more convincing wire transfer scams out there.

Fraudulent schemes include one where you’ve been told that you won a jackpot and need to secure your money, and another where Facebook scammers pose as your friends, messaging you that they’re in trouble and financial help. Always double-check in these situations.

Additionally, the Consumer Financial Protection Bureau (CFPB) has issued rules to protect consumers who send money electronically—typically over $15—to foreign countries. It won’t cover every situation, so you should still be careful who you are sending money to, but it does provide some protection.

For example, CFPB rules generally require that banks and wire transfer companies disclose the exchange rates and fees that are collected by the company—as well as information on when the funds will be available to the consumer—before you send your money.

If there are any problems, the rules also state that consumers have 30 minutes (and sometimes more) to cancel a transfer. The CFPB also requires companies to investigate if a consumer has a problem or claims that their money has not arrived.

Sending a wire transfer safely is all about staying vigilant and aware. Here are a few tips to keep your money safe from fraud:

  • Always know the person or business you’re sending money to.
  • If your friend messages you on social media that they are in trouble and need money, take caution. Ask them a question only they would know the answer to, or ask for some other proof of identification.
  • If you are purchasing a home and receive a phone call from a settlement company to send money in order to close, verify that information with your mortgage broker before sending a dime.
  • Do your due diligence: Make sure the items you purchase and the person you purchase them from are legit.

What are the alternatives to wire transfers?

If a wire transfer doesn’t seem like the best option for you, there are some other options available. Here are some of the alternatives to consider:

  • P2P payment apps: There are plenty of peer-to-peer (P2P) payment apps used widely by consumers today, including services such as PayPal and Zelle, or mobile apps such as Venmo and Cash App. These services come with their own potential fees, and may limit how much you can send — that being said, they’re convenient to use and even allow you to pay multiple parties at once.
  • ACH transfers: Automated Clearing House (ACH) transfers are often used for “direct deposit” payments, such as when you receive your paycheck electronically or pay your credit card bill online. These transfers are pretty similar to wire transfers, but with some different limitations: For example, you cannot use third-party services like TransferWise with ACH payments, and there often some restrictions on the amount you can send.
  • Joint bank accounts: If you’re regularly sending money to a family member or spouse, it may be worth opening a joint bank account together. That way, you can both withdraw and deposit from a shared source of funds.

So is a wire transfer is your best way of sending money? That depends on where the funds are going, how much you’re sending and how quickly you need it to get there. Above all, it’s important to know your options — and potential security risks — before sending money in any form.