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Saturday, September 7, 2013

Fundamentals of International Bank Transfers

Today, life seems to be impossible without banks. They have become part and parcel of our lives. The new generation banks have been providing a lot of useful services apart from the basic lending and saving of money. It is because of these technological developments the banking sector is being able to spread its service across space and time.

Bank to bank transfers, be it national or international is becoming very popular among common men because of the unparallel safety and security offered during such transfers. These transfers are generally completed within a couple of hours. The transaction is done only if the sender has enough funds in his account. And once it reaches the bank at the receiving end, it will be cleared immediately and can be accessed quite easily. The banks at both the sending and receiving ends must have reciprocal accounts with each other else the transaction is made to a corresponding bank with a reciprocal account.

International Bank Transfers can not be made without the SWIFT/BIC code. SWIFT code which stands for Society for Worldwide Interbank Financial Telecommunication is also known as ISO 9362 or SWIFT BIC or even BIC code of SWIFT Id is the standard format of Bank Identifier Code. It is approved by the International Standard Organization (ISO). This code is alpha numeric and represents the bank. This code is used for interbank transfers and other interbank communication for secure transactions. 

How Does It Exactly Work?

The first step is obvious. The sender will have to approach the bank or whichever financial institution he wants to send the money from. The recipient will have to provide his/her account number along with the SWIFT code of the particular bank where the recipient has the account for transaction. 

The bank at the sending end will send a secure message to the bank at the receiving end and request for the payment as per the given instructions. 

It usually takes a few hours for the transfer to be completed and the funds to reach their destination account. But for some exceptions, it may take a few days too. 

All the bank transfers collect payment for the service offered from both the sender and the recipient. The bank at the sending end will collect the free from the sender and the bank at the receiving end will deduct the fee from the amount transferred. This will mean that the amount the recipient receives will be a bit less from what the sender had originally sent.

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