What factors impact the cost of international bank transfer fees?
Time and speed of transaction
The time of the transfer plays a big part. As previously mentioned, the foreign exchange rate changes and can increase or decrease depending on when the sender makes the transaction. International bank transfer fees are also impacted by how soon the beneficiary needs the money. Overseas payments typically take between three and five days, but extra charges will be applied if the parties involved need to speed up the transaction, such as by using a same-day option.
Currencies and countries involved
Another factor to consider is the currencies involved, as rates will vary depending on which pair of currencies are being processed. Certain locations are also more expensive to send funds to than others, particularly countries lacking modern banking infrastructure and financial technology. And the amount of money being transferred may also influence the fees — the more funds being sent, the better the rates are likely to become.
The payment provider
Ultimately, the biggest factor impacting the cost of international bank transfer fees is the bank or payment provider being used. Every financial institution has different capabilities that will influence the price of its services. For example, technological limitations may mean a bank has no choice but to rely on legacy systems that are likely to be more expensive. Other banks could be understaffed or operate in an under-resourced area — it’s possible that a transfer between two EU banks with high fees will still be cheaper than a transfer between low cost banks in countries such as Moldova and Nepal.