A guide to bank transfers in Australia for businesses

Key takeaways

• Bank transfers involve the electronic transfer of money from one bank account to another

• Bank transfers can be domestic or international and are underpinned by different payment systems

• Businesses should be aware of the best and most cost-effective bank transfer method for them, especially when sending international transfers

Running a business in Australia means managing a constant flow of transactions. Efficiently handling these payments is vital for your bottom line, and for many businesses, bank transfers keep your business moving day-to-day. From paying suppliers to receiving client payments, understanding the essentials of domestic and international transfers can help you reduce costs and improve security.

This guide will take you through what you need to know about bank transfers, covering both domestic and foreign currency transfers. When you understand how bank transfers work, you will be able to optimise your payment flows and ensure your business's financial operations are as smooth and cost-effective as possible.

What is a bank transfer? 

A bank transfer is the electronic transfer of money from one bank account to another. It’s a broad term that covers domestic transfers, cross-border payments, and interbank transfers.  

For businesses, bank transfers provide a secure and efficient way to pay suppliers, employees, or partners. However, payments don’t always have to go through a bank. Fintechs like Airwallex are licensed to offer money transfer services, too.

Types of bank transfers in Australia: a breakdown

Australian businesses have several types of bank transfers options to choose from. Most domestic transfers can be done through NPP or OSKO. Meanwhile, international payments are sent through the SWIFT network, wire transfers, and telegraphic transfers.

What types of bank transfers are there in Australia?

There are a few different types of bank transfers in Australia that generally fall into two categories: domestic transfers and international transfers. Both domestic and international transfers use different payment systems to transfer money.

Domestic bank transfers

Domestic bank transfers are facilitated through two payment systems: BECS and the NPP. 

• Bulk Electronic Clearing System (BECS): Also known as Direct Entry, BECS is Australia’s main system for processing everyday, automated transactions like direct debits. It’s managed by the Australian Payment Network and available for payments up to $100 million.

• New Payments Platform (NPP): A modern, real-time payment system that enables instant transfers 24/7. This innovative network launched in 2018 and uses simpler identifiers like a phone number or email (known as a PayID) instead of a BSB and account number. It also allows for more information to be sent with each payment.

International bank transfers

International bank transfers between Australia and other countries often take place on the SWIFT network. This messaging network facilitates transfers between 11,000 banks and financial institutions in 200+ countries.³ 

SWIFT doesn’t actually transfer or hold money – it works as a secure messaging system that banks use to communicate during international transfers. It ensures payment instructions are sent accurately between financial institutions to process the transaction.

Another way to send money internationally is through local payment rails like BECS in Australia, ACH in the USA, and SEPA in the European Union. These are systems that allow money to move between banks and financial institutions within a country. Using these payment rails means faster transfers and lower fees, as transfers are treated like a local transfer. Fintechs like Airwallex give businesses the option to use local payment rails instead of SWIFT.

Step-by-step: How to send an international business transfer

Sending an international business transfer is relatively simple, and involves the following steps:

• Get your recipient’s details ready: This includes their legal name and their business address. 

• Bank details: This depends on the payment rail you’ve chosen. For example, a SWIFT/BIC code for SWIFT payments or an IBAN for sending via European payment rails.

• Choose your payment rails: Compare payment rails (eg. SWIFT vs local rails) by speed and fees. SWIFT payments offer wide payout coverage of 220+ countries but can take up to 5 days, whereas local payment countries have fewer fees and can be as little as 1 day.

• Initiate the payment on your online banking portal or through your business transfer platform

• Estimate your fees and final amount your recipient will receive: If sending via SWIFT, remember intermediary bank fees may apply.

• Timing: When do you need your payment to arrive? Avoid weekends and public holidays to reduce delays.

• Track and reconcile: Make sure to record the payment and ensure your ERP exports match your remittance data.

How to transfer money to another bank account in Australia

Moving money between Australian bank accounts is straightforward – you just need your recipient’s details (such as their BSB and account number). Here are the specifics you need and the steps to follow to transfer money between bank accounts in Australia.

Details you need to make a bank transfer in Australia

• Your recipient’s BSB (Bank/State/Branch number), which is 6 digits, and account number (8–9 digits). You can also make a transfer with their PayID, which can be their mobile number, email, or ABN/ACN 

• The recipient’s account name (for your reference) and a clear payment description or invoice number

• The amount, payment date (now or scheduled), and any internal approval requirements

Steps to make a bank transfer in Australia

1. Log in to your online banking or app and navigate to make a new payment

2. Select between PayID/Osko (instant) or standard/BECS (same or next business day)

3. Add your recipient’s details (BSB/account number or PayID) and double-check these are correct

4. Enter the amount and a clear reference (for example, an invoice number) and choose to send now or schedule

5. Approve the payment using your bank’s security check; save the receipt and payee

Transfers can also be made over the phone and in a branch

Most NPP/Osko payments arrive in under a minute unless it is a new payee, while standard transfers usually land within one business day. Domestic transfers are generally free, while international transfers typically include fees and FX costs.

Why are bank transfers important?

Bank transfers involve more than just sending money from account A to account B – they help businesses in a number of ways, including building trust, lowering transaction costs, and reducing risks.

• Reduced chargeback risk. In the case of a customer payment, bank transfers can’t be reversed once a customer completes them, unlike credit card payments, which come with the risk of chargebacks and high fees. If a customer is unhappy with their purchase, they need to request a refund directly from you, which lets you address the issue and‌ possibly avoid a refund. 

• Builds trust with local customers. In Australia, offering transfer types like NPP and OSKO can align with customer expectations and boosts trust. 

• Lower transaction costs. Local bank transfers often have lower processing fees compared to card payments, helping businesses save money on their payment gateway’s transaction fees. 

• Security. NPP and OSKO are regulated by the Reserve Bank of Australia (RBA) which sets strict safety and reliability standards. The RBA ensures these payment systems follow strict standards to protect against fraud and misuse. With these safety nets in place, businesses and consumers can confidently send and receive electronic payments.

Manage local and global transfers with the Airwallex Business Account

Timely and cost-effective bank transfers are critical to seamless business operations, and this is exactly what Airwallex offers. Our Global Account supports both local payment rails and Swift payouts, and we find the fastest and most cost-effective route for each of your online money transfers.

The Airwallex Global Account lets you open local bank accounts in more than 60 currencies, access like-for-like settlement in over 14 currencies, and expansive payout coverage to over 200 countries. You can also access interbank rates for over 60 currencies. With Airwallex, you can save up to 80% on your FX fees.

Simplify your transfers and truly bank like a local with smarter transfers. Airwallex supports your growth ambitions by keeping your money moving and helping you work smarter, not harder.

Frequently asked questions

Is telegraphic transfer the same as wire transfer?

Yes, a telegraphic transfer and a wire transfer are essentially the same thing. Both refer to the direct electronic transfer of funds between bank accounts, via a secure network managed by global financial institutions. The term “telegraphic transfer” is commonly used for international transactions, while “wire transfers” are used for both domestic and international transfers.

Can a wrong bank transfer be reversed?

Yes, in some cases, a bank can amend or reverse a wrong transfer for a fee.  Each financial institution has different rules for handling incorrect transfers. The sooner you report the mistake, the better your chances of cancelling or reversing the transaction.  

What is a Bank Identification Code (BIC)?

A Bank Identification Code (BIC) is a unique ID that identifies a specific bank during international transactions. Think of it as an address for banks to communicate securely and efficiently. BIC codes are often used interchangeably with SWIFT codes, but there’s a subtle difference.  BICs are mainly used for European banks, while SWIFT codes are used globally. Their codes are also structured differently.⁵ To avoid delays, it’s always important to double-check your recipient’s BIC code before making a transfer.

Is it safe to pay by bank transfer?

Paying by bank transfer is generally safe, because financial institutions in Australia use secure systems to process transactions and are regulated by the Reserve Bank of Australia (RBA). Airwallex is licensed by the Australian Securities and Investments Commission (ASIC). We keep customer funds in trusted global financial institutions and protect them according to the local regulations in each country where Airwallex operates. However, you should only transfer money to individuals or businesses you know, because it can be difficult to reverse payments. 

How long do local vs SWIFT business transfers take?

Generally, transfers sent via local payment rails are faster than those sent via SWIFT. Money transfers sent over local payment rails can arrive in as little as one day, or even a few hours. Transfers sent over the SWIFT network can take between 1–5 days. Local payment rail transfers are also cheaper as they do not come with intermediary bank fees or receiving fees.

Are there bank transfer limits?

Yes, bank transfers have limits, which can vary depending on the currency and the country you’re sending to. Business accounts usually have higher limits than personal accounts, though the limits vary from fintech firm to fintech firm. For example, Wise has a US$1,000,000 limit for ACH transfers in the USA⁷, but Airwallex’s transfer limit is US$15,000,000⁸. It’s a good idea to check with your bank to know the specific limits for your transfers.

Sources

1.  https://www.swift.com/join-swift

2. https://www.tmbank.com.au/faq/banking/what-is-the-new-payments-platform 

3. https://www.auspayplus.com.au/brands/osko 

4. https://www.swift.com/standards/data-standards/bic-business-identifier-code

Disclaimer: This information doesn’t take into account your objectives, financial situation, or needs. If you are a customer of Airwallex Pty Ltd (AFSL No. 487221) read the Product Disclosure Statement (PDS) for the Direct Services available here.