10 Reasons Why Bank Transfers Take So Long

Bank transfers are generally considered a quick and convenient way to move funds, but sometimes, the process can take longer than expected. Whether it’s a domestic or international transfer, understanding the reasons behind delays can help you better manage your transactions. In this article, we will explore the 10 most common reasons why bank transfers can be delayed.

Bank Working Hours and Weekends

One common reason for delays is the timing of when the transfer is initiated. Most banks process transfers only during their regular business hours, which are typically Monday to Friday. If the transfer is initiated outside of these hours, such as on weekends, holidays, or at night, it may not be processed until the next business day. For example, if you initiate a transfer late on a Friday afternoon, the bank may not process it until Monday morning, even though it’s the same calendar day. This delay is particularly evident with international transfers, as they often require processing by multiple banks.

Tip: To avoid delays, try to initiate transfers during regular business hours and check your bank’s cutoff times to ensure timely processing.

Transfer Method

The method you choose to make the transfer can also affect how long it takes to process. Different transfer methods have varying processing times:

Wire Transfers: Wire transfers are usually faster, typically completing within a few hours to a day, depending on the bank and the destination. However, for international wire transfers, this time can vary.
ACH Transfers: In the U.S., ACH (Automated Clearing House) transfers usually take 3 to 5 business days to complete.
International Transfers: Transfers made through systems like SWIFT can take anywhere from 2 to 5 business days to complete. The method you choose directly impacts the processing time. International transfers, especially if they don’t use faster digital payment platforms, typically take longer because there are more steps involved.

Time Zones and International Transfers

When making international bank transfers, time zone differences can significantly impact the speed of the transfer. Cross-border payments aren’t as instantaneous as domestic payments. For example, transferring money from the U.S. to Europe or Asia may experience delays due to time zone differences. If the transfer is initiated outside of the destination country’s business hours, it may be delayed. Moreover, if the transfer involves multiple banks, the processing time can be even longer since each bank has its own operational hours.

Intermediary Banks

Many international bank transfers pass through multiple intermediary banks, which can slow down the overall process. These intermediary banks act as middlemen between the sending and receiving banks, especially if there’s no direct relationship between them. Each intermediary bank has its own processing times and procedures, which can create bottlenecks. Additionally, intermediary banks often charge fees, which can further delay the transfer.

Internal Bank Processing Time

Banks typically conduct due diligence before processing transfers, particularly for large amounts. They may verify the source of funds, ensure compliance with Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations, and check for fraud or illegal activity. These compliance checks can take time, especially if the transfer amount is large or if the transaction is flagged as suspicious. If any issues are detected during the review process, the transfer could be temporarily frozen, causing delays.

Tip: If you’re making a large or international transfer, contact your bank ahead of time to ensure all required information is in order to avoid delays.

Currency Conversion

Currency conversion for international transfers is another significant reason for delays. If the transfer involves converting one currency to another, such as from USD to EUR or CAD, this process can add extra time. Banks and transfer services need to ensure that the currency conversion is done correctly and at the most favorable exchange rate available. Additionally, exchange rates fluctuate regularly, which can cause banks to take longer to complete the conversion. The complexity of the conversion process and the volatility of exchange rates can also lead to delays.

Incomplete or Incorrect Information

Providing incomplete or incorrect information is one of the most common causes of delays in bank transfers. Banks require accurate account numbers, routing numbers, SWIFT/BIC codes, and other details to complete transfers. If any of this information is missing or incorrect, the bank may reject the transfer and ask you to initiate it again, which causes significant delays. The bank may request the sender to verify the information, or they may return the funds for correction, which greatly extends the transfer time.

Tip: Before initiating a transfer, carefully check all details, especially for international payments, to avoid unnecessary delays caused by incorrect information.

Large Transactions

Large transactions often undergo extra scrutiny and delays because banks are more cautious when handling significant sums of money. When the transfer exceeds a certain limit, banks may require additional verification steps to ensure the legitimacy of the transaction. Banks may ask for extra documents or personal confirmation before processing large transactions, which can cause delays in the processing.

Tip: If you’re making a large transfer, providing the required documents and information upfront can help expedite the process.

Bank Policies and Technical Differences

Different banks have varying internal policies and technical platforms for handling transfers. Some banks have outdated systems that process payments more slowly, leading to delays. Additionally, each bank may have different priorities and timeframes for processing transfers. For example, some banks may prioritize domestic payments while delaying international transfers. This could cause delays if your transfer doesn’t fall into their priority category.

Network Congestion

Network congestion is another potential reason for delays in bank transfers. Just as internet traffic can slow down during peak hours, a bank’s payment systems can become overloaded during high-volume periods, especially during holidays or times of financial market volatility. When large numbers of transactions flood into the system at once, the bank’s processing system may become overwhelmed, causing delays.

Tip: Avoid initiating transfers during peak periods or holidays to reduce delays caused by network congestion.

PhotonPay Payouts: Fast, Reliable International Payments

Although bank transfers are generally reliable, various factors can lead to delays in processing. From bank working hours and transfer methods to currency conversion and intermediary banks, several elements can impact the speed of a transfer. Understanding these factors and timing your transfers carefully can help you avoid unnecessary delays.

When making international payments, choosing a service provider like PhotonPay can significantly improve transfer efficiency. PhotonPay is a digital financial infrastructure providing global cash management services to businesses. Our innovative core products include Global Accounts, Card Issuing, Online Payments, Payouts, FX Management and Embedded Finance. Here are some features of PhotonPay Payouts:

Unlimited global payouts. Endless potential.

A Wide Range of Payment Routes

Enjoy full coverage of 180+ countries and support payments in 60+ currencies.

Access Bank-beating Rates

Market-leading FX rates for any business size and avoid hidden transaction fees.

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