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SWIFT/Telegraphic/Wire Transfer - Bank to Bank Money Transfer Updated information on Wire Transfer in India
For orders less than US$5000, payment by bank transfer is more economical than opening a letter of credit in most cases and involves less paperwork.
What is SWIFT Transfer ? (from http://www.slowtrav.com/faq/swift.htm - site is modified now )
S.W.I.F.T. (Society for Worldwide Interbank Financial Telecommunication), in
short SWIFT (always in block letters) was
formed for application of computer technology to payments message exchange
There are a number of elements to the SWIFT contribution:
1. The network.
The SWIFT network is available exclusively to financial institutions. It has a closed membership, which presently numbers over 7400 user banks and other types of financial institutions, in 199 countries. They use a variety of connection types, from dial up to ISDN, x25 and IP. In 2002 this network processed 1.8 billion financial messages. A peak day would see 8.8 million messages exchanged over the network. A message sent over the SWIFT network, by a sender bank to a receiver bank in , will arrive at destination, authenticated and encrypted, in a few seconds.
2. The standards.
To enable service to such a huge and diverse constituency, SWIFT had to transcend language and thus was at the forefront of standardisation in the financial industry. Since the SWIFT network over time developed into supporting the processing of practically any known financial business type, the standardisation resulted in specialised message types, using data segments, data elements and codes, both addressing codes and processing codes. Thus, a bank in Canada can receive payment instruction from Japan, for example, and the payment will be executed even though nobody at the receiving bank can read Japanese. The codification has stripped the need for a specific language by assigning strict attributes to information, so that it always means the same thing regardless of the part of the world where it is processed.
3. The reliability.
Unlike a cheque or mailed money order, or cash, a SWIFT transaction never gets lost. Tracking, redundancy and acknowledging procedures are built into the network and in the message processing systems.
4. Privacy and security.
Each SWIFT message between two banks is authenticated with a secret key known only to the two banks involved. In addition, encryption hardware/software encrypts the already authenticated message based on the most sophisticated encryption algorithms in existence.
The architecture of the network is such that it is fully redundant and can recover quickly from any distress. The case in point was 9/11, when the SWIFT network was fully available and enabled the Federal Reserve and New York banks to continue their operation despite wide swath of lost telecom connections.
The execution of the payment will be as good as the information provided by the sender of the money. And so, there is always the need to spell fully and correctly the name and address of the beneficiary as well as that of beneficiary’s bank. Even better, having the full and correct account number held by the beneficiary will ensure the funds are credited into the correct account without delay. If you wish that the counter-party be advised on receipt of funds, the full and correct telephone number can be added to the message exchanged between the banks.
The transfer charges are high because in various countries movement of funds is governed by local regulations, which have nothing to do with how the money is being wired, and banks charge commissions for every transaction.
We have received payment by wire transfer from more than 10 countries and usually receive the amount promptly, within 3-4 days. we faced a problem on the following occasions
sending bank had not specified the recipients name and only indicated the
beneficiary's account number. Only after the sender faxed the Telegraphic
Transfer receipt to us, and we provided the same to our bank, the
transaction was traced and
the amount transferred to our account. So in this case, the telegraphic transfer took nearly 40 days!
2. We had assumed that a transfer to India from Australia in Australian Dollars would be cheaper for the sender. However instead of a telegraphic transfer to our account , ANZ Grindlays bank routed the transfer through Standard Chartered. Both the banks deducted their substantial commission/charges , and the amount finally received by us was nearly half the amount sent !
insist that the sender fax /send a scanned copy of the telegraphic transfer
receipt provided by his bank, as it is required to track the transaction and
ensure that the amount is safety credited to your account.
If you have any query , feedback or suggestion, kindly let us know by email or through our feedback form
Updated information on Wire Transfer in India
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