We’re reader-supported and may be paid when you visit links to partner sites. We don’t compare all products in the market, but we’re working on it!
When you're sending or receiving an international money transfer through a bank, you'll often see the terms "telegraphic transfer", "TT" or "wire transfer".
In this guide, we'll help you figure out what the different terms mean and the process behind sending money across borders.
A telegraphic transfer is what you get when you go to a bank to make an international money transfer. It means your money will be bounced along a network of correspondent banks until it arrives at its destination.
A telegraphic transfer works by bouncing money between different banks until it arrives at its destination. Each bank the money passes through en route will have its own fees and processing times, which is why telegraphic transfers can be slow and more expensive than a money transfer service.
This network of banks is called the SWIFT network.
Money will only pass between banks with pre-existing commercial relationships, known as "correspondent banking" relationships. Each correspondent bank en route will take a cut of the money as they handle it to cover processing fees and may take a day or two to process the payment.
There are two main reasons why banks can only pass money through other correspondent banks:
Correspondent banks hold nostro accounts with each other to facilitate international payments.
With this system, correspondent banks can simply add and deduct amounts from the nostro accounts to account for payments sent to them from partner banks as they pass through.
So when you send a telegraphic transfer, it will ripple through a series of nostro accounts at different banks until it arrives at its destination.
The number of banks in a chain will vary depending on the payment corridor. For straightforward transfers to or from USD, there might only be two or three. For other corridors, there will often be more since US dollars tend to serve as a hub.
For example, if you're sending money from Australia to Europe, it might go something like this:
To make a telegraphic transfer, you will need to do the following:
Your transfer is going through multiple banks, so each one may take a fee. We can break the fees down into four parts:
When you initiate your transfer, you'll often be given the choice of paying these fees yourself or having them deducted from the receiver's funds.
To send a telegraphic transfer, you'll need to provide the following:
The most important thing to know is that when you send money through a bank, it'll typically take the form of a telegraphic transfer or TT, and that means it will usually be much more expensive than using a money transfer service instead.
Check out some money transfer services below to see if you can find a better deal. Our table below lets you compare the services you can use to send money overseas. By inputting how much you want to transfer and to what currency, you'll be shown live exchange rates, fees and more.
An investment of a few hours could save you thousands of dollars – here's how to bring down your household bills.
Travel insurance is an essential expense for anyone planning a trip overseas, though sometimes it can be difficult to find cover if you are over 80 years of age.
Find out how to leverage XTZ token holdings to earn interest. Stake in the Tezos blockchain or provide liquidity to a DeFi protocol.
Nix credit card debt with these balance transfer offers, which mean you can switch and save with 0% interest for up to 36 months.
SPONSORED: Save yourself the heartache of lost funds by learning how to safely send cryptocurrency from one wallet to another with this simple guide.
What to know about insurance before renting out your home, and what to look for in Airbnb insurance.
If you’re looking for ways to gain exposure to Bitcoin and other digital currencies, cryptocurrency ETFs could be worth exploring. Find out what crypto ETFs are and how they work in this introductory guide.
Don't pay extra when shopping with the online giant - Angus Kidman shows how to save every time you shop.
Find out how to claim vasectomies and tubal ligation with Medicare or private health funds, and the things you should know before going in.
Find out how to stake your THETA tokens and how Theta’s multi-BFT proof-of-stake consensus mechanism works.
