Wire transfers electronically adjust account balances without exchanging cash. They are secure and popular for banking transactions, but may have fees. Western Union offers an alternative method of bank transfer, but wire transfers have drawbacks, such as the possibility of fraud. Bank-to-bank wire transfers are secure and eco-friendly.
A wire transfer is an electronic transfer of money. In the case of a bank-to-bank transfer, no actual cash is exchanged, but the electronic balances in the respective accounts are adjusted accordingly. This is a very secure way to transfer funds, as positive identification is required from both account holders, and there is no possibility of a chargeback unlike a personal check.
Wire transfer has become a very popular payment method for banking transactions, such as credit card balance transfers, personal account management, for example, transferring funds from a savings account to a checking account, and purchases with ATM card at the point of sale. Every time you swipe your ATM card at a retailer, you are authorizing a wire transfer from the bank account associated with that card to the retailer’s bank account. Although these transfers are generally free to the customer, one fee often accompanies others. Sometimes it is a flat fee, and in other cases it is based on a percentage of the total funds being transferred. This is often true when transferring credit card balances.
Companies like Western Union offer an alternative and anonymous method of bank transfer. So you can walk into Western Union in Arizona, for example, and send 100 US dollars (USD) to Western Union in the Bahamas by simply paying cash to the Arizona office plus any fees. Your friend in the Bahamas can go to Western Union to receive the $100 in cash in minutes. The money is transferred electronically.
A wire transfer is useful when someone doesn’t have access to a bank account, but it also has drawbacks. If this type of transfer is used to purchase something from a private party, the seller may provide false information to the sender. Cash can be collected at the receiving end with the fake ID, and the party can disappear without providing the promised goods. The police are also concerned about subversive organizations using such transfers to finance illegal activities.
A bank to bank wire transfer has the advantage of being much more secure and desirable than other forms of payment. These transfers even save paper by reducing the need for checks and deposit slips, making them more environmentally friendly than standard bank forms.
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