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There are several ways to transfer money between bank accounts, whether online, through a mobile app or by visiting a bank branch. The best method depends on when you need the money to arrive and what you’re sending it for.
Below, you’ll learn about the different transfer methods so you can choose the one that best suits your needs.
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What is a bank transfer?
A wire transfer transfers money from one bank account to another without withdrawing cash. You can make a wire transfer for several different reasons, such as transferring money from a savings account to a checking account, sending money to kids in college, or paying closing costs. of a house.
How does a bank transfer work?
Bank transfers have three moving parts: the sender, the recipient, and the transfer method (the medium you use to transfer the money). Here is the typical process for transferring money from one bank account to another:
- Choose the transfer method to transfer the money.
- Designate the recipient and confirm the required information.
- Select the amount of money to send.
- Send the money.
The information you’ll need for your recipient varies by transfer method.
How to transfer money from one bank account to another
Several transfer methods are available, each with advantages and disadvantages. Here are five ways to transfer money.
Internal Electronic Funds Transfers (EFTs)
Most of the bank transfers you make on a daily basis, such as signing up for direct deposit of your paycheck or using online bill payment, are electronic funds transfers (EFTs), where money is sent back and forth using electronic payment networks. One of the most common types of transfers occurs on an electronic funds transfer network called the Automated Clearing House (ACH).
Most ACH bank transfers and other EFT payments are processed at no additional cost to customers, but check with your bank to be sure.
If you have multiple accounts at the same bank, such as a checking account and a savings account, it’s often easy to set up a transfer between them. This is called an “internal transfer” of funds. Go to your bank’s online banking platform or mobile app and look for options to set up a funds transfer. But be aware of the pros and cons of linking your bank accounts.
You will usually have the option to set up a one-time or recurring transfer between connected accounts. Most banks allow you to choose to transfer funds immediately (during the current business day) or schedule a transfer.
If your accounts are already connected, the bank can approve the transfer immediately (if it’s a business day). Transfer processing may take longer when connecting a new account.
External Electronic Funds Transfers
Suppose you have an online savings account at a separate bank from your checking account. You can connect your online savings account to your current account and set up an “external transfer”.
To transfer money to an external account, you will usually need the external bank’s routing number and account number. Once the accounts are linked, you can make transfers between the accounts.
If you prefer to go the digital route, you can use mobile apps to send and receive money. This is called peer-to-peer (P2P) transfers. Some of the most popular apps are Venmo, PayPal, CashApp, and Zelle, but there are plenty of apps available. Apps are a quick way to send money to friends and family or pay small businesses, often with little cost. If there are fees, they are usually paid by the beneficiary.
It is important to understand the fees, schedule and limits of each P2P application before using it to transfer money. For example, Zelle has a transaction limit of $500 per week, and Venmo lets you send $4,999 per week or less. Some payment apps do not allow international transactions. Therefore, if you need to send money to someone in another country, you may need to choose another payment method or be prepared to pay higher fees.
Electronic transfers can help you send money quickly and securely. This type of transfer is useful if you need to transfer larger sums of money. Transfer fees vary by bank. It can cost $5 or more for domestic transfers or $25 or more for international.
Electronic transfers are generally considered a highly secure and fast way to send money. If you send a wire transfer to another bank in the United States, the funds may be available within a business day or even within hours. Sending an international bank transfer may take longer to process.
When making a bank transfer, make sure you are transferring the money to the correct recipient and not to a scammer. Wire transfers cannot be canceled once they have been processed.
Another way to transfer money from one bank account to another is to write a check. When you write a check, you are authorizing your bank to transfer funds to the person or business “payable to” listed on the check. You can write yourself a check if you need to transfer money from one checking account to another or make a deposit to a new account.
Now that mobile check deposit has become mainstream in mobile banking apps, you can often write and deposit a check from the comfort of your home. Keep in mind that checks are not an instant form of money transfer. It may take a few business days for the check to be deposited and cleared, during which time it will be listed as a pending transaction in the deposit account.
How long does a bank transfer take?
Often the best way to send money depends on when the recipient needs the money. Here are the common transfer times for the transfer methods mentioned above:
- Internal EFTs. Often instantaneous, especially if the accounts are already linked.
- External EFTs. Until the second working day.
- Peer-to-peer transfers. Often, P2P transfers between the same application are instantaneous. For example, Venmo payments to other Venmo users happen instantly. Transferring money from an app to your bank account may take longer.
- Bank transfers. Up to the second business day, although domestic transfers can be received the same day if sent before the cut-off time designated by the bank. International transfers may take longer.
From paper checks to mobile apps, you’re spoiled for choice when it comes to transferring money between bank accounts. Before deciding which method is right for you, review transfer times, fees and transfer limits – you’ll be more likely to get your money where it needs to go on time.