Digital money transfer or electronic funds transfer (EFT) — is a transfer of funds from one bank account to another bank account.
EFT includes such transactions as:
- Direct deposits;
- Credit & debit card
- Wire transfers;
- Online bill payments and others.
It is important to mention remittance transactions (sending funds cross-border to another person).
Today, we will talk about how long electronic money transfers take and what factors affect them.
Electronic money transfer: How long does it take?
There are several factors that affect money transfers:
- First of all, it depends on financial institutions, currency type, time and date of transfer, and location.
- Secondly, if we are talking about SEPA money transfers that are made between European countries, their transfer time depends on the type of transfer.
- Thirdly, when talking about SWIFT (international money transfers), the time depends on the countries from which the transaction was made.
- Lastly, if we are talking about non-paperless transactions, they require in-person verification. Paperless transactions facilitate the money transfer between recipients and merchants.
Electronic money transfer: How does it work?
When the money is transferred between two banks or financial institutions, no physical money is sent. In simple terms, they exchange information about receivers’ and senders’ account numbers, and the amount of money being transferred.
For example, if the SWIFT technology is used, the sender pays the amount of money that he wishes to transfer upfront to his bank. The recipient bank gets a message with instructions on how to receive it and all the necessary information. Then the recipients’ bank deposits funds into the right account.
When the transfer is complete, two banks will settle the payment on the back end.
Electronic money transfer: What factors affect it?
The duration of transfers depends on several factors. That’s why some transfers are sent and received immediately, and other ones take a couple of days. These factors include:
- When money was sent. This is true for countries with different time zones. If you want the receiver to get money as quickly as possible, check the cutoff time of his bank.
- Location. Duration time depends on the senders’ and receivers’ location.
- Domestic transfers take a short period, around 24 hours or faster. If the transfer is made within the same financial institution, it would be delivered immediately.
- International transfers will be processed longer, because of the number of checks that should be made. Such transactions will take between one or five days. Also, transfers between some countries can be longer than usual.
- Information. If you do not provide all the relevant information, it will affect the duration of your transfer.
- Currencies. Currency conversion may add time to transfer processing if you are transacting with your recipient in different currencies.
Wrapping up
Today, most money transfers proceed online. Internet technologies allow you to send money without hassle using an EFT. But there are still some factors that affect the duration of the transactions. The creation of SWIFT is aimed at unifying countries all over the world and making money transfer much faster and more secure.
