Incoming international wire transfer to a US Bank: What you need to know about the fees and the cheaper alternatives

Receiving an international wire transfer is easy, but you should spend time to consider the best way to get your money as they are usually super expensive both in terms of fees and unfavorable exchange rates.

That’s why Monito generally recommends two alternatives:

• If you’re sending money to yourself from a bank account overseas or can convince the person sending you the money to use a cheaper specific money transfer service, you can compare the rates and find the most competitive for your transfer with Monito’s real-time comparison widget.

• If you’ve no control over the way the money will be transferred, your alternative is to open an innovative multi-currency account than enable you to receive the money in the local currency as a local (available in Australia, the UK, European Union or New Zealand). Once you’ve received money in the local currency in this account, you’re in control and can repatriate the funds at a cheaper rate to your US bank account.

However, if you don’t have any other option...

Here are the steps to receive an international wire to a US Bank Account

1. Get hold of your bank’s SWIFT code.

First, you’ll need to communicate some information to the person or entity sending you the international wire transfer. SWIFT stands for Society for Worldwide Interbank Financial Telecommunications. Most US banks have a SWIFT code. For most banks, the code is unique to your branch, and you will need to contact them or find it on their website. Some banks do have more general codes, such as WFBIUS6S for Wells Fargo. Note that US banks do not have an IBAN (International Bank Account Number) number, which you might need to explain to the person sending them money. You will also need to provide them with the name and address of the bank. Check with your bank which addresses you should use.

2. Share your personal details

You should also make sure that the sender has your name, address, account number, and the reason for the transfer. Yes, some banks will ask.

3. Decide the transfer's currency

The sender can decide to send you US dollars (and converting their local currency with the sending bank into US dollars) or send you the international wire transfer in their local currency and let your bank convert it in US dollar before it reaches your account.

In this case, ask your bank what the exchange rate will be.

Sadly, banks tend to mark-up the exchange rate, and they seldom make their rates public. Chase, Bank of America and Citibank all obscure their rates, while Wells Fargo makes them public. Exchange rates for buying or selling currencies are sometimes easier to find. Knowing what the exchange rate is will help you decide whether to go through your bank or a specialist transfer company. Bank rates tend to be about 3-4% over the mid-market rate. (this is the rate Google gives you when you use their exchange calculator). Always compare the quoted rate with the mid-market rate.

4. Decide who pays the international transfer fees

Agree as to who is going to pay what fees. There are three options with SWIFT transfers:

• OUR: the sender pay all fees, incl. the sending + receiving + third-party correspondent banking fees.

• BEN: all these fees are paid by the beneficiary

• SHA: each party pays their own fees.

SHA is generally the cheapest option, as you pay the exact fees and not a flat rate that is inflated to make sure to compensate for all eventual fees. But if you need to receive a specific amount, tell the sender to use the BEN option.

5. Learn about US bank's incoming international wire transfer fees

Fees for receiving incoming wire transfers vary with US banks.

6. Wait for your money.

An international wire transfer can take anywhere from 1 to 3 days.

Again, going through your bank is often not the best option. Specialist wire transfer companies tend to charge lower fees and offer more favorable exchange rates. By using a comparison site like Monito, you can easily find the best alternative, which can depend on the amount of money you are receiving and where it is coming from.