Bank Transfers

Today, we explore a sensitive topic – Wire Transfers.

You might ask, why is this sensitive? It’s a simple matter of transferring funds from my personal account to GoldSilver Central’s account, that’s it right? Turns out, not so. And we’ll dive deeper into this realm today to see what are the various costs associated with Wire Transfers and how do they affect you as a client.

Before we go further, lets clarify the terms first. By Wire Transfer, we are referring to an electronic transfer of money. The typical route utilizes a network such as Society for Worldwide Interbank Financial Telecommunications System (SWIFT) to “communicate” from one bank to another, and once the recipient bank confirms the “message”, funds are transferred over and the respective balances are updated in both sender and recipient’s accounts. The entire process takes several days on average from start till end.

But that’s not true! Bank transfers in Singapore are immediate.

That’s because Singapore uses FAST.

FAST stands for Fast and Secure Transfers (I know, the creativeness behind the naming blows me away as well). It is a electronic transfer service enables customers in participating banks to transfer Singapore Dollars from one back to another in Singapore almost instantly. It was introduced on the 17th March 2014 and is currently offered by 23 banks (Information accurate as of 13th December 2019). Personal account transfers currently have no fees attached and corporate accounts only pay a minimal transfer fee (Yes, there are costs for bank transfers also!)

So what are the costs involved?

Typically, we have to break it down into the Sender’s bank fees and the Recipient’s bank fees. We aren’t banking experts here, however based on our experiences, the Sender bank’s fees are typically administrative fees charged by the banks to process your transfer in a timely manner. This makes sense as verification and manual authentication still have to be performed to ensure the right “message” is being sent and received correctly. Thus, banks typically have agreed upon rates which they base on to bill their clients for the transfers, which is the same for international banks also. This is the same regardless of whether you are a “sender” bank or a “recipient” bank, although the charges probably differ slightly. Bear in mind also that depending on the route being used, there may be intermediate banks involved and these incur charges as well. (Think domestic airlines and international airlines. Domestic flights connect you to international hubs which in turn connect you to international flights)

Hence, if a sender instructs their bank to absorb all transfer fees, they should clarify whether its for both sender and recipient bank fees, or just the sender fees. The bank would then act upon the sender’s instructions accordingly. Of course there have been occasions where the unwary / forgetful have instructed wrongly and end up sending too little / too much funds, resulting in more hassle for the sender and recipient.

To be honest, we at GoldSilver Central Pte Ltd have likewise experienced the above on several occasions. Trust us, when it comes to international business dealings, the difference of US$0.01 cents could result in the delay of an entire shipment. (Not Fully paid is not fully paid, period.) And to resend the funds of US$0.01 would likely incur the same charges as before, since the process is the same. (Some banks have enacted policies like minimum and maximum fee charges to lessen the load on client transfers) Hence, it is always important to check with the recipient what kind of policies do they have when it comes to transfer fees.

Why can’t all recipients absorb the transfer fees then? (After all, it’s probably a small amount right?

Wrong again. Bank transfer fees can go up to hundreds of dollars for large amounts of money but do not decrease proportionally for lesser amounts of money. After all, the same administrative work is required for both US$1 and US$100,000 transfers. Hence, international bullion companies with large transaction amount but low profit margins state upfront that recipient banking fees will have to be borne by sending clients. This is akin to sending parcels out for delivery. You don’t usually expect the recipient clients to pay for delivery costs, unless under special circumstances.

Here at GoldSilver Central Pte Ltd, we emphasize on our transparent processes and take it a step further by providing our clients with the banking transaction receipt page to show the fees breakdown should they request for it. We do this to show that we do not add any further “mark-ups” for bank transfers and profit from such transfers. If you are a client who does frequent international transfers, you may wish to consider requesting for such statements as well. Already, we know of transfer platforms which have the same principles regarding transparency and show the exact breakdown of the fees involved.

So that’s it, a quick look on local and international bank transfers. Keep in tune as we continue our updates. Click here for our various Payment Methods