A wire transfer is an electronic, bank-to-bank movement of funds — no cash, no cheque, no card. Your bank sends a message to another bank (often through several intermediary banks) instructing it to credit a specific account. The term "wire" is a relic of the 19th century, when Western Union used telegraph wires to transmit money instructions. Today, the message travels over digital networks, but the name stuck.
How a wire transfer actually works, step by step: (1) You give your bank the beneficiary's details — their full name as it appears on their account, their account number or IBAN, and their bank's BIC/SWIFT code. (2) Your bank creates a structured payment message (an MT103 for international SWIFT wires, or a Fedwire instruction for US domestic). (3) The message travels from your bank to one or more correspondent banks — intermediaries that hold accounts at each other and pass the funds along. (4) Each correspondent debits the previous bank's account and credits the next. (5) The final correspondent bank credits the beneficiary's account. The whole journey is tracked by a UETR — a 36-character code that uniquely identifies the payment at every hop.
Types of wire transfers: domestic vs international. Domestic wires (within one country) are fast and cheap. In the US, a domestic wire over Fedwire settles in minutes and costs $25–$35 at most banks. In the UK, CHAPS settles in hours for typically £25–£35. International wires are more complex — they cross borders, change currencies, and hop through correspondent banks. An international SWIFT wire typically takes 1–5 business days and costs $25–$50 at the sending bank, plus $15–$35 per correspondent hop that may be deducted from the payment amount.
Wire transfer vs ACH: ACH (Automated Clearing House) is a batch-processing system used for payroll, bill payments, and small transfers. ACH is cheaper (often free or a few dollars) and takes 1–3 business days. ACH can be reversed in some cases. Wire transfers settle individually and in real time (for domestic wires), are final and irrevocable once settled, and are used for larger, time-sensitive, or international payments. Rule of thumb: use ACH for routine, low-urgency domestic payments; use wire transfer for large, time-critical, or international payments.
Wire transfer vs fintech apps (Wise, Revolut, PayPal): fintech apps are not traditional wire transfers — they use their own internal systems, often holding pre-funded local currency in the destination country. Wise, for example, does not literally send your GBP to India — it debits your UK account in GBP and credits from a local INR pool already held in India. This makes fintechs faster and cheaper for many corridors. The trade-off: fintechs are for personal and SME amounts; for very large business payments (six and seven figures), banks and their SWIFT infrastructure remain the standard.
What information do you need to send a wire transfer? For international wires: (1) Beneficiary full name (exactly as on their account); (2) Account number or IBAN; (3) Bank name and BIC/SWIFT code; (4) Bank address (required by some banks); (5) Purpose of payment (required for India, China, Mexico, and many other countries); (6) Your own identification details. For US domestic wires: beneficiary name, account number, and ABA routing number. Double-check all details before sending — once a wire is credited to the wrong account, recovery requires the beneficiary's cooperation.
How to track a wire transfer: every international SWIFT wire has a UETR (Unique End-to-end Transaction Reference) in MT103 field 121. Ask your bank for this 36-character code and paste it into Ohmyfin for free real-time tracking. If you only have the bank's TRN reference, Ohmyfin can also try to locate the payment by reference. The tracker shows you which bank is currently holding the payment, what status it is in (ACSP = in progress, ACWP = on hold, ACCC = credited), and any fees deducted at each hop.
"Bank transfer" is a broad term that can include wire transfers, ACH, SEPA, and even internal transfers. A "wire transfer" specifically refers to a real-time or near-real-time, bank-to-bank push payment — typically via Fedwire (US), CHAPS (UK), TARGET2 (EU), or SWIFT (international). All wire transfers are bank transfers, but not all bank transfers are wire transfers.
Only before the beneficiary bank has credited the account. Once the funds are credited, reversing requires the beneficiary's agreement. If you sent to the wrong account, call your bank immediately and ask them to submit a GPI Recall Request — speed is critical.
Domestic US wire: $25–$45 at most banks; some (Schwab, Fidelity) offer free outgoing domestic wires. International wire sending fee: $25–$50. Correspondent bank deduction fees: $15–$35 per hop. Exchange rate margin: 1–3% at most banks. Total cost for an international wire: $50–$150 all-in, depending on route.
SWIFT is the messaging network used for international wire transfers. A "SWIFT transfer" is an international wire that uses the SWIFT network. All international SWIFT transfers are wire transfers. Domestic wires (Fedwire, CHAPS) do not use SWIFT — they use national systems.