6 surprising reasons why your bank transfer is delayed

Waiting for your money to transfer can be frustrating. But as frustrating as they are, delayed payment transfers are a common hiccup that comes part and parcel with running a business. 

And more than simply a frustration, a delayed bank payment can have a tangible effect. It can mean the difference between a bill getting paid on time, and a hefty fine. It can mean your staff don’t receive their wages on time. It can mean the difference between hitting your targets for that quarter or not.

The direct impacts on your cash flow are obvious.

So why are money transfer times often so slow?

There are a few reasons, but let’s first look at what’s actually happening during your bank-to-bank transfer, and the time it typically should take.

How long does it take for money to transfer between banks?

When it comes to transferring money between banks, the timeframe for completion is not set in stone. It can vary due to various factors, including but not limited to the following:

• Various payment methods can affect transfer times. For instance, the "Faster Payment System" (FPS) is an instant Real Time Gross Settlement (RTGS) that operates 24/7, facilitating real-time transfers. However, it currently only supports transfers in Hong Kong dollars (HKD) and Chinese Yuan (CNY). RTGS transactions in US dollars (USD) or Euros typically take couples minutes to a few hours, so it is important to keep in mind the cut-off times of each bank. Local and overseas wire transfers take 1 to 5 business days.

• Selected bank: The transfer time may differ across banks. Larger banks tend to have faster processing speed, while smaller banks may take longer.

• Transfer amount: Generally, larger transfer amounts may take longer for review and confirmation.

Keep reading to find out more reasons why your bank transfer is taking longer than usual to arrive, causing your payment to be held back.

1. Different time zones and bank cut-offs

When making a bank transfer, the varied times are often at the mercy of any number of human factors. But you’ve also got the difference in time zones.

If you make an international transfer at the end of a working day, your payment will likely be processed on the next business day, which means it will take longer than usual to be completed.

When working with other businesses in Asia, where everyone is in similar time zones, there is plenty of overlap in working hours between the different regions. However when partnering with companies based in the US and UK, which operate in substantially different time zones than Hong Kong, you may run into issues coordinating your payment timelines.

For example, a payment sent out at 9am in Hong Kong converts to 1am in London when the business day has ended. When doing businesses and transferring money globally, you need to take into consideration the possible time zone differences between the sending and receiving ends.

2. Your bank transfer is actually made via the SWIFT network

The SWIFT network is the banking infrastructure that underpins your international transfers.

Now, this network doesn’t transfer your money, per se. It transfers your information. The information of your transaction is transferred in the form of a payment order, from bank to bank, until it arrives at its desired account. These payments usually pass through a number of different intermediary banks before arriving at your destination, which is a major cause in a delayed payment.

But how long a SWIFT payment takes can vary, taking anywhere from 24-48 hours, up to five business days. 

3. Bank holidays, even those in other countries

Banks work under the legal definition of business days, which means they close for public holidays and shut up shop over Christmas and Chinese New Year. So, as bank transfer times only count business days towards your transfer period, these holiday times don’t count towards this, even if you started the transfer prior to the day they’re closed.

You also need to be aware of the country to which you’re sending your funds, and any holidays they may celebrate. Golden Week, for example, is celebrated in both China and Japan and is a series of public holidays contained within a one-week period. So if you transfer money to either of these countries during this time, you can expect a delayed payment.

4. You transferred money over the weekend—but not your weekend

It pays to be aware of the working week in the country to which you’re transferring your funds.

As per the business day rule, bank transfers made over the weekend usually won’t begin their transfer until the next business day. This is usually a Monday, but what’s considered a weekend also depends on what that country considers a working week.

For example, the United Arab Emirates operate on a Sunday to Thursday working week, with their weekend over Friday and Saturday. Some Malaysian companies also work to this timeframe, while others operate on a more recognisable Monday to Friday.

5. Global events, like worldwide pandemics

COVID-19 has led to a complete overhaul of how businesses were done.

This has had a significant impact on traditional bank-to-bank transfers and their transfer times.

Many banks in Hong Kong have notified their customers to expect delays. As a result of the global pandemic, banks have been experiencing shortage of staff, working from home arrangements, and other unpredicted staffing disruptions.

Now this isn’t by any means a normal reason that your international bank payment is delayed, but it’s definitely something to take into account in a decidedly not normal time.

6. Safety audit, incomplete or incorrect information, or sometimes just… missing paperwork

Sometimes you just don’t know what’s happening on the other end of your transfer. Different countries have different money transfer regulations, tax rules, and additional documentation that needs to be filled out. China, for example, requires proof for the source of money. This ensures that the source of the money is legal, and it’s been legally obtained through means of income.

This paperwork will be done by a human, which means — as we said above — it’s at the mercy of human error. So your transfer documentation might be all okay on your end, but in the intervening process there’s a form that isn’t filled out correctly, or it just… gets lost.

We’re not saying this is an expected occurrence, but it’s still something that can occur. Missing documentation can lead to significant delays in your payments, so it’s something to factor in if time is of the essence.

Airwallex gets your payments there on time

So how do you make sure your international payment arrives on time?

Airwallex can help you save hours on global transfers. 

While some of the aforementioned issues can’t be minimised, Airwallex’s online payment platform ensures your transfers are as smooth and seamless as possible, without being hindered by any unnecessary interruptions.

You can make international money transfers in multiple currencies, in one business day or less. Our technology enables your payments to bypass the SWIFT network, utilising local bank transfers instead, which makes your payments faster and reduces your fees at the same time.

It’s win-win, and doesn’t rely on a system that’s over 40 years old.

And that’s not all.

Add up to 3% back to your margins with a business account built to go global

There are no hidden charges with the Airwallex Global Account and you don’t ever have to pay monthly fees. You can even save up to 90% in FX rates when compared to transferring through banks. Create your free account today or watch our demo.