Bank Money Transfer: Comparison Of Popular Methods

Today, we will discuss the Good and Bad sides of modes of Online bank money transfer such as wire, electronic transfers, direct bank deposits, e cheques and ACH (Automatic Clearing House). We will also compare all these bank money transfer methods to each other to give you an overall idea of the whole thing.
For example, a wire bank money transfer is quicker than all the others, but it is also costly. The points listed here may help you learn a little more about money transfers, and it may also help you to choose which one is better for you.


1. Wire Transfer:


In this type of bank money transfer, the system connects from the senders account straight to the statement of the recipient. There is no broker here. It is an immediate transfer and usually occurs very quickly.

how Wire transfer works

Pluses:

  • It is easy to execute.
  • One of the quickest means of sending money from one account to other.
  • One can send money globally anywhere with the wire transfer.
  • It is an indeed safe method of sending money.
  • One may send money abroad very swiftly.

Minuses:

  • The revision of wire transfer is not possible, or it is very complex.
  • Banks will impose a charge of receiving wire fund.
  • Sending money abroad is expensive by this method.
  • Some banks may deny offering overseas wire transfers.

 


2. Electronic Fund Transfer (e-Transaction):


An e-transfer include any online money transaction, but it commonly assigns to Bill Payment, direct charge, bank transfer, inter bank transfer, external transfer, international transfer, wire/ACH transfer.

Pluses:

  • Intra bank E-Transaction is quicker than other methods.
  • A comparably safer way of money transfer.
  • It is free of cost if the transfer is from the same bank accounts.
  • Banks manage to keep internal transfers simple.
  • Most external e-transfers can be made online.

Minuses:

  • It may take few days to complete sometimes.
  • Transactions are as limited as your bank wants.
  • Some banks charges fees for e-transfers.
  • Doing it manually may be time-consuming if there are multiple payments.
  • Recurring e-transfers may make you overdraw if you do not have the money in your account.

 


3. Direct Account Deposits:


Direct deposit is the bank money transfer when money directly stores in a specified account number. It is the reverse of a direct debit (ACH), where money is withdrawn from one account and transfer into another one. A direct deposit means shoving money out of an account, and a direct debit is drawing money out of an account.

Pluses:

  • A very effective way to pay many people at a time.
  • Clearing direct deposit amounts is faster than cheques.
  • It may explain recurring payments.
  • You can adjust the amounts each time as per your wish.

Minuses:

  • Overlooking may cause repeated payment errors.
  • Certain companies and institutions refuse to accept direct deposits.
  • There is a banking charge for using direct deposit method.
  • Some banks permit you to overdraw when you transfer direct deposits.
  • Set the account up may be tricky initially.

 


4. ACH (Automated Clearing House) transactions:


Automated Clearing House (ACH) is a computerized network for commercial affairs in the USA. ACH treats immense volumes of credit/debit transactions in lots. ACH credit transfers include direct deposit, payroll and vendor payments.

ACH Transfer benefits

Pluses:

  • ACH transactions are almost reasonable than wire transfers.
  • One can pay various people and workers routinely and cheaply.
  • It can set up recurring billing, so you don’t have to do it manually.
  • Some organizations offer rebates for paying via recurring ACH.
  • There is no obligation to write or send cheques.
  • Issues like lost/forged cheques become a thing of the past.
  • Tracing your payments is easy.
  • Environment-friendly than using cheques.

Minuses:

  • You have to see for billing mistakes to stop repetition.
  • An ACH transfer will take at least one day to complete.
  • Some ACH bank money transfer even takes 4-7 business days.
  • Sending money people overseas with ACH is very complex or may not be possible.
  • Some people ignore about their recurring transfers and pay more than required.
  • You may overdraw your account in case insufficient balance.

5. E-Cheque Transfer:


An e-Cheque is a bank money transfer that you make straight from your bank account. You can only give an e-Cheque if it is the only payment method you have, and you don’t have a credit/debit card for payments. If you have a backup method of payment, you will not be capable of sending e-Cheques.

Pluses:

  • Translation is easy, and all it needs is scanning of the physical cheque.
  • They are simpler to modify and review than wire transfers.
  • It may decrease bank fees for dealers that receive them.
  • Some dealers accept only e-cheques than paper cheques.
  • Funds transfer will be faster than for paper cheque.

Minuses:

  • You do not obtain a copy of dropped cheques like the case with paper cheques.
  • There may be additional bank charges for using e-checks.
  • Some Traders won’t accept e-cheques.
  • Payment times may vary depending on networks.

 


6. ACH Cheque transactions:


After 9/11 attacks, a bill was passed that asserted people might shoot paper cheques and deposit them that way. A trader may photograph your cheque and use that photo/scan copy to store it without actually giving the paper cheque.

Pluses:

Fewer chances to make errors if you just use recurring ACH cheque transfers.
Excellent for freelancers and entrepreneurs who charge on a weekly basis.
Convenient for firms that charge a monthly fee.
It’s good if you have to pay a different price on a regular basis.
Fit if you charge clients with an irregular recurrence.

Minuses:

You may overdraw your account in case insufficient balance.
ACH debit forms need you to give up some authority.
The trader requires specialized scanning tool.
Some dealers may charge a fee to convert cheques.
Some merchants may not feel comfortable in converting cheques.

Which bank money transfer method is more Secure ?????

In almost every bank money transfer method, security will depend upon the institute that handles the transaction. But more importantly, it also depends on the user.
Most security violations happen because of identity theft or scam with the sender. Sometimes, a security infringement occurs, or money is lost because of human error on the part of the originator.
For example, entering wrong account information while setting up a payment.

bank money transfer

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