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Wire transfers allow customers to transfer money electronically from an account at a bank or credit union to an account elsewhere, usually for a fee. These generally safe and fast transactions, which are carried out without the money changing hands, can be carried out between financial institutions in the United States or with institutions in other countries.
Electronic transfers are ideal for sending large sums of money quickly. For example, you can use a wire transfer to send up to $500,000 from your bank account to a title company account when you complete a home purchase. Financial institutions normally charge wire transfer fees to complete these transactions, and if you make a habit of moving your money, the costs can add up.
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What are the rules on bank transfer fees?
Financial institutions decide how much to charge for wire transfers, based in part on the state laws that apply. Federal law does not limit wire transfer fees in the United States. A bank or credit union must disclose the dollar amounts of wire transfer fees and other fees when you create your account.
Fees vary depending on the financial institution, the amount of money you are transferring, and where the money is going. You usually have to pay a fee to send or receive a bank transfer, and these fees may be cumulative: a financial institution that receives a bank transfer from one of your accounts may charge its own transfer fees in addition to what you have paid to your bank to send the money.
As a general rule, you can make a bank transfer at a bank branch, online or by telephone.
Who is responsible for transfers?
In 2021, the Federal Reserve processed nearly 204.5 million domestic wire transfers worth more than $991 trillion. Other wire transfer processors include the US-based private sector Clearinghouse Interbank Payments System (CHIPS) and the Belgian Interbank Financial Telecommunications Company (SWIFT). SWIFT made headlines in 2022 as some Russian banks were banned from the system due to the war in Ukraine.
Median wire transfer fees
The cost of a wire transfer can range from free to what you might pay for half a tank of gas. Here are the median transfer fees for the institutions we surveyed:
Bank transfer fees per institution
These are the wire transfer fees for 12 major financial institutions in the United States
National and international bank transfer fees
International wire transfers generally cost more than domestic wire transfers. For example, US Bank charges a $20 fee for an incoming domestic bank transfer, but a $25 fee for an incoming international bank transfer. Meanwhile, the bank charges $30 for an outgoing domestic wire transfer, but $50 for an outgoing international wire transfer.
Why higher fees? Because international transfers are more complicated than national transfers. An international wire transfer from the United States must go through a US clearinghouse and at least one processing system in another country, which lengthens the time it takes for an international wire transfer to reach its final destination. In addition, a financial institution may add currency conversion fees.
A domestic bank transfer can take one or two business days, while financial institutions claim that an international bank transfer can take up to seven business days.
Other ways to send money
You may be able to avoid wire transfer fees by dealing with a financial institution that waives them for certain customers or does not charge them at all. Or, you can look into these cheap or free alternatives to bank transfers:
- Bank check. An official check drawn directly from a financial institution’s account can be cheaper than a wire transfer, although it’s not an ideal option if you need to send money quickly. To give an example: Wells Fargo charges a $10 fee for a cashier’s check. If you order your cashier’s check online, it must be delivered to an address in the United States, for which the bank charges an additional $8.
- ACH transfer. An electronic payment through the Automated Clearing House (ACH) network of financial institutions is usually free and often takes less than a day. At one time, payments were considered less convenient than wire transfers due to ACH transaction limits, but the cap for same-day ACH transfers was increased in 2022 to $1 million, from $100,000 previously. Note that ACH payments can only be used for domestic transactions, not for international transfers.
- Zell. This payment application allows you to send or receive money free of charge.
- PayPal. A consumer can use the PayPal online payment system to make a national transfer without paying any fees. But international wire transfers incur a 5% fee as well as a flat rate of 99 cents to $4.99.
- Venmo. This payment app lets you send money for free from a Venmo balance, debit card, or bank account.
Find the best online banks of 2022
A bank transfer can be a fast and secure way to send money. In fact, some businesses prefer to receive money by bank transfer: title companies often encourage homebuyers to send money for the purchase of a home by bank transfer rather than using a check from bank.
Keep in mind, however, that many financial institutions charge wire transfer fees. When transferring money, consider your options carefully. An alternative, like a payment app, can let you send or receive money for free — and keep a little more cash in your pocket.