Bank transfer fees: how much banks charge for international transfers

How much do international bank transfers cost?

Every bank is different, but in general you can expect them to take as much as 3-4% of your total transfer as a fee when you send money internationally. Thankfully, despite that, a lot of banks will try to cap the amount they charge their customers.

This will vary depending on the institution. Finder recently highlighted what the cap of 10 major UK banks were for both incoming and outgoing international transfers.

It’s also important to note there are several ways a bank might charge you for sending money overseas:

• Outgoing fee. The amount you have to pay when transferring money to another country.

• Incoming fee. The cost of receiving money from overseas.

• Initiation fee. Effectively a “setup fee”, which will vary depending on whether you transfer over the phone, online, or in branch.

• Tracer fee. If you wish to track the progress of a transfer, you will also be asked to pay a small sum.

While none of these fees are life-changing, they can soon add up if you’re regularly needing to send money abroad.

What is the alternative to transferring money internationally with a bank?

For those wanting to avoid the myriad of fees associated with international bank transfers, specialist international money transfer services exist to make the process quicker and more affordable.

Here at WorldRemit, we offer customers the chance to flexibly send money anywhere in the world, at a typical high street bank.

The process itself is incredibly easy. If you decide to move money with us, all you need to do is:

1. Make an account. Just as you would with most services, sign up through your email address, using a strong password and a unique username.

2. Begin your transfer. You can begin the movement of your money by selecting the currency you want to convert into, as well as the method of reception for the person on the other end. At this point you’ll be given an upfront look at the exchange rate and any small fees (which will be included as part of your transfer).

3. Enter personal details. At this point you’ll be asked to enter the details of the person receiving the money. That means their name, address, and possibly things like their IBAN or BIC.

4. Complete your transfer. Once you’re happy with the details you’ve entered (make sure to double check them for mistakes), you can pay for your transfer. Choose to do this through either your bank, or by using a credit or debit card.

It really is that easy. What’s more, you aren’t just limited to online transfers. If the person you’re sending money to isn’t completely tech savvy, WorldRemit offer all of the following options for picking money up:

• Through their bank account

• Via an in-person cash pickup

• Through a mobile money account

• As an instant airtime top-up for their smartphone

What are the benefits of using an international money transfer specialist?

Services like WorldRemit are becoming increasingly popular amongst those looking to move money overseas. Just some of the benefits to using a money transfer service include:

• Lower fees. While there’ll always be some sort of charge, the fees you should expect to pay when transferring with an international money specialist will be far lower than a traditional bank.

• Cost-free tracing. You’ll also be able to track the progress of your transfer at every stage, without having to pay a fee. Having this level of clarity can bring real peace of mind.

• Much shorter transfer times. While banks tend to take days to move money between foreign accounts, transfer specialists can sometimes do the same thing in a few hours. If your transfer is started during working hours in both time zones, the money could arrive that day.

• Quick and easy. As we’ve discussed, moving money this way is a simple four-step process, which can be done in minutes. The flexibility of the service means you can transfer money easily no matter where you are or what you’re doing.

• Proven expertise. Where banks have had to adapt to the modern concept of moving money abroad, transfer specialists have been created with the intent of facilitating the movement of funds. That means everything is streamlined, working to make the process as seamless and safe as possible.

Why are banks more expensive to transfer money internationally?

Owing to the extra costs and viable alternatives, it might be confusing to understand why banks charge so much in the first place. There are a number of reasons why you can expect to pay higher fees when moving international money with a bank:

• Service limitations. Banks tend to focus on domestic financial management ahead of international. That makes sense, but it means that they can find themselves with technological limitations, or even understaffed to handle certain transfers. The lack of capabilities could result in them needing to charge higher fees to make a transfer.  

• The countries and currencies involved. While it might surprise you, some countries cost more to send money to than others. If you’re trying to send funds to a country which has a poor modern banking infrastructure, it will cost more to facilitate the transfer. Certain currencies will also be charged at a higher rate, if they’re less commonly traded in.

• The speed of the transaction impacts the exchange rate. While an international money transfer service will set a fixed rate when moving funds, the same is not true of a bank. The amount someone receives will vary depending on the fluctuations during the period the money is in motion.

• Legacy issues. Most banks lack the infrastructure to quickly and cheaply facilitate international transfers. And while they have introduced procedures which make it possible, their historic focus on domestic banking means they’re behind the eight-ball when it comes to efficiency and affordability for customers.

What you need to make an international bank transfer

If you do decide to stick with your bank for an upcoming transfer, it’s important you get it right. Issues when moving money can see it sent back to you – which not only causes delays, but could see you slapped with another fee.

Here’s everything you need to have when making an international bank transfer:

• The total you’re sending. If you know how much you want to send from your own currency, or how much you want the other person to receive, the other amount will be converted automatically.

• Name & address. These need to match what’s linked to the recipient's account.

• Address of the bank. In some cases you’ll also be asked to provide the address of the bank where your money will be sent.

• SWIFT Code (BIC) & IBAN. These are vital pieces of personal data, which tell a bank who they’re interacting with and what account the funds need to go into. A Bank Identifier Code (BIC) is unique to each bank using the SWIFT system, while an International Bank Account Number (IBAN) is used to identify an individual.

• A payment reference and reason for payment. This helps banks to know why you’re sending money, which can speed the process up if you’re trying to send a large amount.

How long does an international bank transfer take?

How long your transfer takes to arrive depends on a variety of factors, but it’s generally the case that money sent through a bank will arrive in its intended account within two-to-five business days. This is likely to be shorter if the transfer is from one EU country to another.

Things which are likely to delay the process include:

• Fraud and compliance checks. While it adds time onto a transfer, fraud checks are an important part of making sure your money is safe. It could be the case that both banks involved in a transfer want to run fraud checks.

• The time zones involved. While you may start the transfer during business hours on your end, it’s possible that time zone differences mean you run into hurdles. This is particularly annoying if a transfer runs over a weekend as a result.

• Errors in payment details. Making mistakes when you’re trying to send money can cause the transfer to fail, and the money will bounce back to you. This will often result in an additional fee being charged to you.

• Bank holidays and weekends. If you start your transfer, or it carries over into the weekend or a bank holiday, there will be delays as a result of being outside of business hours. Check what national holidays are coming up in your recipient’s country if getting the cash there quickly is a priority.

Remember, transferring money abroad doesn’t have to be expensive or difficult. If you’re interested in an affordable transfer which is safe and speedy, make sure to turn to WorldRemit for your next overseas payment. Get in touch with our friendly team to find out more.

This communication is intended for marketing purposes only and does not constitute or provide legal, tax, investment or financial planning related advice.