Need to send money to someone else’s bank account? A wire transfer is often the best and fastest way to do so safely. In this article, we'll explain how wire transfers are done and clear up some common misconceptions about the difference between wire transfers vs. Automated Clearing House (ACH) transfers.
Wire transfer process
Generally, it’s best to initiate a wire transfer at your bank. While some banks offer online wire transfers, proceed with extreme caution. Unlike ACH payments or transfers, a wire transfer can’t be cancelled. It’s important to have all the information you need together, and it’s essential to verify that the information is correct.
Here are the basics needed:
- Name of recipient
- Bank account number
- Bank name
- Bank address
- SWIFT or routing number
- Transfer amount
- Currency
Though some wire transfers are free, you'll often pay a fee that can cost up to about $50. The recipient of the wire transfer usually will also need to pay a fee. Check with both financial institutions to make sure you’re comfortable with the amounts they're charging.
Related investing topics
Wire transfers vs. ACH transfers
If you pay bills online, chances are good that you’re using the ACH system, which is a slightly different payment animal than a wire transfer. Three key differences stand out:
- Cost. ACH payments are much cheaper than wire transfers.
- Speed. Wire transfers are much faster than ACH payments.
- Cancellation. ACH payments can be cancelled. Wire transfers can’t.
- Amounts. Wire transfers generally allow for greater amounts of money to be transferred.
- Geography. Most ACH payments are domestic transactions. Wire transfers can be used for overseas payments.
About the Author
