Wednesday, August 29, 2012

FUND TRANSFER THROUGH SWIFT

Normally funds can be transferred electronically through undernoted channels
 
1.                   General Transfer > Fund Transfer within the Bank
2.                  RTGS / NEFT > Fund Transfer within the country between Bank
3.                  SWIFT > Fund transfer in all over world
 
SWIFT is one of the oldest and trusted mode of fund transfer between Banks of different countries some features of SWIFT is;
i.                    Transfer takes normally 2 to 7 days
ii.                 Most legal way for international fund transfer
iii.               This is the only way through which funds can be send to any country
iv.                Transfer cost is comparatively high ( normally $15 to $75)
 
Fund transfer diagram
Remitters account > remitters Banks account in same country > remitters banks account in receiving country > remitters correspondents bank account in receiving country > receivers bank account in receiving country > receivers account in receiving country
 
How transfer takes place
Remitters Bank initiates coded financial message for receivers Bank via SWIFT and at the same time takes funds from remitters account and credit the same to Nostro account of receivers Bank, some time it may happen that the remitting Bank sends Financial message to receiving Bank but delayed actual credit of funds in nostro account which result in delay of actual fund transfer
 
What are the requirements for transfer of funds?
User needs to know the SWIFT Code of receivers Bank Branch, Receivers Account no. , Name of Receiver as mentioned in receivers Bank Books and IFSC Code of receivers Bank Branch where receivers account is being maintained
Users need to visit his Bank and instruct his Bank to initiate SWIFT Transfer by giving above details; user should also inform his bank whether funds need to be converted in currency of receiver’s country or it should be kept as foreign currency
 
For other details / queries, drop a mail at prashant.singh@sbi.co.in

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