Many have a misconception that international money transfers occur instantly. But you must know that sending money ‘legally’ from India to another country consumes time.
However, at times outward remittance gets delayed beyond the normal time frame. As a forex company that does more than 1000 transactions per month, there are some points ExTravelMoney officials keep in mind to ensure timely receipt of wire transfers.
In this blog, you shall go through the top 7 reasons pointed out by our wire transfer experts along with tips to avoid or even solve it.
Also Read: How Wire Transfer From India to Abroad Actually Works
How Long Does International Money Transfers Take?
An optimal international money transfer can be completed within a few hours or may take up to a maximum of 5 days.
7 Reasons Why Your Wire Transfer is Taking Too Long
- Compliance Query
- Incorrect or Insufficient Payment Details
- Destination Country
- Currency Conversion
- Bank Relationships
- Bank Holidays and Weekends
- Different Time Zones
1. Compliance Query
“Stringent compliance checks for AML, FATF, and LRS regulations often cause the longest delays due to verification procedures to spot potential red flags.”
If you send money to a person multiple times in a financial year, you shall be suspected of money laundering and your transaction shall be held. Anti Money Laundering (AML) laws of India prevent the possibility of it.1
Solution: Provide documents to prove your relationship with the beneficiary and the transaction purpose.
Sending money to countries or individuals listed by the Financial Action Task Force (FATF), or to people with names similar to those listed, can negatively affect your transaction time.2
Solution: Present identity proofs of the sender and receiver.
The outflow of currency is controlled by the Liberalised Remittance Scheme (LRS). According to it, an Indian resident is only permitted to do forex transactions below $250,000 in a year.3
Prevention: Be honest and declare any foreign currency purchases and outward remittances that occurred in the financial year on the A2 Form before the transaction.
2. Incorrect or Insufficient Payment Details
“Simple typos can lead to substantial delays due to mismatches in information. It can even lead to rejection of the transfer!”
Money sent from India isn’t credited to the recipient solely based on their account number. Details like name, account and branch number, IBAN and SWIFT code must be matched. The whole transaction can get stuck if any of these don’t align.
Also, do not forget to provide unique identifiers. Robint, our senior-most official, recalls an incident when a student’s overseas university fee payment was kept on hold since she did not provide her student ID number. Since the university was unable to identify the student, the beneficiary bank held the amount.
Prevention: Be all eyes and ears while filling out the A2 Form and do not hesitate to give essential information and documents to the wire transfer officials.
3. Destination Country
“Transfers to politically or economically unstable regions often face delays due to heightened scrutiny.”
According to Mary, with more than 5 years of experience in ExTravelMoney, political tensions in a country can affect your international remittance. Especially when you are sending money to currently high-risk nations such as Russia and Ukraine.
Solution: Wait. Be patient until the intermediary banks and beneficiary banks complete their scrutinisation. If your purpose is genuine and you have the necessary documents to prove it, your transaction shall surely be completed even if might take time.
4. Currency Conversion
“Exotic or less frequently traded currencies might require cross-conversion, adding layers of complexity and delay.”
Shamas, our remittance expert explains it with an example, “ When sending money to Mauritius, the transfer is made in US Dollars instead of Mauritian Rupees due to the currency’s exotic status in India. The amount is converted from Indian Rupees to US Dollars, which is then sent to the beneficiary bank, where it is prevalent to Mauritian Rupees at the current exchange rates.”
5. Bank Relationships
“Intermediary banks stand as a link between the sender and beneficiary banks. Even if it’s a boon, clients consider them as a bane.”
Indian banks do not have a direct financial relationship with overseas banks. But thanks to intermediary banks; transfers can take place through them. However, Nija has noticed that an intermediary bank often holds the payment for additional verification. So outward remittance via intermediary banks takes longer to process.
6. Bank Holidays and Weekends
“We always refer to the international calendar and caution our customers about the holidays and weekends to avoid possible delays.”
Public holidays and weekends can significantly slow down the processing of funds. So Aisha suggests, “Not only Indian bank holidays, but a remitter must also be aware of international holidays to ensure a timely receipt.” For instance, Saturday and Sunday are considered weekends in India, whereas in most Middle Eastern countries, it is Friday and Saturday.
Prevention: Plan your remittance and do not wait till the deadline for your payment. Try to initiate your transfers at the start of the week.
7. Different Time Zones
“The working time of the sender, receiver and intermediary banks affect the timeliness of an international money transfer”
Time zone differences cause minor delays due to mismatched banking hours. A transfer from India to the US might take longer to process due to office-hour mismatches. However, Nandana reminds that at ExTravelMoney, we calculate the time and always encourage clients to initiate the transaction as early as possible.
Prevention: Initiate transfers before the afternoon to prevent verification delays.
Some of the delays in wire transfers can be caused by a fault on the sender’s or receiver’s side. But at times, it can be due to uncontrollable factors. At ExTravelMoney, we prevent any lapses or even craft out ways to solve the issue and ensure timely receipt.
Let our remittance experts handle the complexities so you can relax knowing your money will reach its destination on time. Start your stress-free remittance journey today with ExTravelMoney!
Also Read: 6 Tips to Save Money on International Transfers: Expert Advice
Ann Mariya Job is the Associate Content Writer at ExTravelMoney.com. Holding a Bachelor’s in Journalism, she excels in creating deeply researched, engaging, and crisp content. Her work helps readers understand the complexities of foreign exchange, overseas money transfers, and international travel.