By  Mon Feb 13, 2012

To Avoid Exorbitant Wire-Transfer Fees, Try Your Bank

Wire transfers are one of the fastest ways to send money to family and friends around the world. Although many consumers turn to money transmitters such as Western Union and MoneyGram for wire transfer services, there are instances when banks offer the better deal — especially for domestic transfers.

At money transmitters, the fees vary by the amount transferred, method of payment, and delivery time. A $1,000 same-day, domestic transfer at Western Union will cost $86. For a $100 wire transfer, the fee would be $12.

At the top 10 U.S. banks, the average cost of an outgoing domestic wire transfer (conducted at a branch) is $26.40. If you make the “cut-off time,” which varies by bank, the funds usually arrive on the same business day.

Here’s a chart of the wire transfer fees (made in-branch with U.S. dollars) charged by the 10 biggest U.S. banks:

Bank Domestic - outgoing Domestic - incoming Foreign - outgoing Foreign - incoming
Bank of America $25 $12 $45 $16
Chase $30 $15 $45 $15
Wells Fargo $30 $15 $45 $16
Citibank $25 $10 $40 $10
U.S. Bank $30 $20 $50 $25
PNC Bank $25 $15 $45 $15
TD Bank $25 $15 $40 $15
SunTrust Bank $25 $15 $50 $30
Capital One $25 $15 $50 $15
BB&T $24 $15 $45 $18
AVERAGE $26.40 $14.70 $45.50 $17.50

Banks appear to be a better deal for large domestic transfers. For small money transfers, money transmitters may be the cheaper option.

The headache of international transfers

Costs for foreign transfers are a little harder to calculate, because money transmitters and banks usually charge a transfer fee and then take advantage of the spread between currency exchange rates.

Providers of foreign wire transfers set their own currency exchange rates, which change on a daily basis.

By exchanging foreign currency at a lower rate than the actual rate, the recipient collects less money than expected — the difference is pocketed by the money transmitter or bank.

For example, as of Feb. 10, 2012, Western Union converted 1 U.S. dollar (USD) to 0.59578 United Kingdom pound (GBP); at Chase and Bank of America, 1 USD converts to 0.595 GBP and 0.6028 GBP, respectively.

According to Reuters, 1 USD converts to 0.6346 GBP.

Currency U.S Dollar (USD) U.K. Pound (GBP) Per $1,000 (GBP)
Western Union $1 0.59578 595.78
Chase $1 0.595 595.00
Bank of America $1 0.6028 602.80
Actual $1 0.6346 634.60

Through Chase, a recipient would receive 39.60 GBP ($62.40) less; the sender effectively paid $107.40 for the foreign wire transfer.

What to do before sending money

Before paying for a foreign wire transfer, consumers should request the total amount of fees to be charged and the total amount that the recipient will collect.

To address this sketchy practice, the Consumer Financial Protection Bureau finalized a new rule — to take effect January 2013 — that requires all financial institutions and service providers to list exchange rates, fees and net delivered funds before consumers pay transfer fees.

 

Add Your 2 Cents

  • http://www.facebook.com/sunk818 sunk818

    With some of these rates, you can visit your recipient’s bank and make a deposit in person. Or use Dwolla and it costs you $0.25 to make a transfer. Don’t even get me started on the cost of international transfers… it is a monopoly I want abolished. HSBC is one of the few that will give you free international wires in and out if you have a brick and mortar business.

    • http://www.mybanktracker.com Simon Zhen

      Certainly, there are ways to avoid using wire transfers – and paying their fees.

      But, I think that they prey on those who are in too much of a rush to worry about fees or those who are unaware of other options.

    • Bricks&Mortar

      Hi, saw your comment about free wires if you have a bricks and mortar business. Can you give me more details?

  • Johnny Chisholm

    PNC bank charged me $70.00 per wire I did 4 over the last 4 month’s $280.00 for 4 wires!

  • WlaKom

    I am sending money from Bank of America to Polish account in U.S. dollars (wire transfer). In addition to $ 45 flat fee that is taken out of my account and $ 7 from recipient account, the recipient get the amount reduced by 5 to $ 10 (interbank wire transfer undocumented charge). For two years I demand that this undocumented charge to be taken from my account in the U.S., but Bank of America ignores my request.

    • PiotrGajewski

      I got money in-coming from Poland. I can’t even figure out how much they charged in Poland and then what lousy conversion rate I got, but then Bank of America charged additional $16 on this end. Total thievery – you’d think they would want to encourage me putting money INTO a B o A account.

  • Viktor

    In Washington you can use BECU they charge $35 per wire

    I use Western Union because its online, essay and chiper. $15-$30 depends on country you send it to.

  • massimo

    Just got a wire transfer from an Italian bank into my Chase account. Chase branch told me I would be charged 15 dollars to receive the incoming wire transfer (Randolph Brooks FCO does not charge anything to receive an incoming wire, no matter where it comes from…so that you know). Well I checked my bank statement and it appears Chase charged me another 55$ on top of the 15$ to receive the money. I spoke to a Wire Transfer Dept. rep and they tell me that the 55$ was a
    communication fee” that the Italian bank gave instruction to charge from the amount of money deposited. Did you ever hear anything like that? If there is a communication fee, why Chase states it is only 15 $ to receive an incoming fee. My sister in Italy told me they paid all the costs and fee they were required by the Italian Bank and was told that the amount (that had already being converted in USD by the Italian bank and wired as such) would be the amount to be collected. I am not going to put up with this “legal” robbery by Chase. I already spoke to my Branch and if I do not get that 55 refunded I am ready to become a customer of another bank…likely a Credit Union

    • Roger

      I work for Customer support for Citibank Deposit accounts. Banks use intermediaries to transfer the funds. Every intermediate bank that handles a wire transaction can take a fee directly out of the wire payload (the assets being transferred) without the account holder’s knowledge or consent. In many places, there is no legislation or technical means to protect customers from this practice. If bank S is the sending bank (or brokerage), and bank R is the receiving bank (or brokerage), and banks I1, I2 and I3 are intermediary banks, the client may only have a contract with bank S and/or R, but banks I1, I2 and I3 can (and often do) take money from the wire without any direct arrangement with the client.

  • Hukka_dude

    I got wire transfer of $6000 from Denmark to PNC bank . The PNC bank placed $300 less than the estimated transferred money. They charged additional $15 for receiving transfer which was fine. The bank did not provide any information about who send it or what was the cost associated and exchange rate. I called and asked them why I am $300 less than the estimated money, and got a reply that it is the bank policy not to provide information.
    Seems like they are good at cheating and stealing money. Complete bad impression with PNC bank.