How To Transfer Funds Between Bank Accounts

Bank transfers are transfers of money between different bank accounts. There are three solutions which can be used in order to do that: bank wires, bank drafts and transfers of funds through debit card networks. What are the differences between them and how to select the solution that meets your needs?

Bank wires are transfers of money which are done through the SWIFT system (an international network of financial institutions created to send and receive payment information in a secure way). Bank wires are performed in the real time (one by one) that’s why it is not going to take you long to transfer funds from one account to another. But bank wires are quite expensive that’s why if you have time you can choose a cheaper solution. Also it should be mentioned that bank wires are often used for international money transfers.

Bank drafts are money transfers which are performed through clearing houses (financial institutions which provide clearing and settlement services for other financial establishments and secure transactions). Systems for bank drafts have different names in different countries. In the USA it is Automated Clearing House or ACH, in the UK – BACS, and in Europe – SEPA. Banks drafts cost less than bank wires but you will have to wait for several days until money is transferred from one bank account to another.

If you are located in the USA you can use transfers of funds through debit networks in order to save on interchange fees. But it is most likely that this solution will not work for low-amount and micro-payments because the savings will not be significant enough.

If you want to learn more about different techniques which are used to transfer funds between bank accounts read the information at #UniPayGateway. What is more you can visit Paylosophy Payment Advice Blog.