Bank transfer 2025: bank charges, processing time, and hidden fees

What is a bank transfer?

Bank transfers, including those made via the Faster Payment System (FPS) and electronic Direct Debit Authorisation (eDDA), refer to the movement of money from one bank account to another. This can occur within the same financial institution or between different banks, both locally and internationally.

What is a bank remittance?

Bank remittances refer to money transfers made electronically between two different accounts for various purposes, such as payments, investments, or personal transfers. In Hong Kong, most banks offer international remittance services to overseas bank accounts.

Bank charges for international remittances typically depend on the destination, currency, and whether the transfer is conducted online or at a branch. Fees commonly start from HK$100 or more.

How do bank transfers and bank remittances work?

Here is a general overview of how bank transfers work:

1. Initiation: To begin, ensure you have sufficient funds in your local bank account. The sender then initiates a bank transfer or remittance by providing their bank with the payment instructions.This includes the recipient's account details (such as the account number, bank and branch code for Hong Kong local transfers, or the SWIFT/BIC code for international transfers) and the transfer amount.

2. Verification and authorisation: The sender's bank verifies the transaction details and authorises the transfer. This may involve security checks, such as one-time codes or mobile app push notifications, to ensure the legitimacy of the transfer.

3. Interbank communication and settlement: The sender's bank communicates with the recipient bank through secure networks like the Society for Worldwide Interbank Financial Telecommunication (SWIFT) network to facilitate the transfer. The recipient bank then receives the funds and credits the recipient's account with the transferred amount. Settlement times can vary depending on factors like the type of transfer (e.g. domestic or international) and the number of banks involved. In general, most bank transfers are completed in 3–5 business days.

4. Notification: Both the sender and recipient typically receive notifications confirming the transfer, either through online banking platforms, email, or SMS.

5. Completion: Once the funds are credited to the recipient's account, the transfer is considered complete. The recipient can then access and utilise the transferred funds as needed.

Processing time for bank transfers

Some common methods for bank transfers include telegraphic transfers (TT), demand drafts (DD), and mail transfers. Among the three, telegraphic transfer is the most widely used option. Both local and overseas banks utilise the SWIFT network to exchange messages and process instructions for telegraphic transfers. 

The SWIFT network operates in over 200 countries and regions globally.Upon registration as a SWIFT member, each bank and branch is assigned a unique SWIFT code (also known as the Bank Identifier Code, BIC). To make a transfer, simply enter the recipient bank's SWIFT code and account details, and the funds are usually credited within 1–5 days after sending the instructions.

The processing time for demand draft and mail transfers is less predictable due to their nature. These two options require sending remittance instructions via physical mail, so factors such as distances and flight schedules would hinder ‌transit significantly. Most demand draft and mail transfers take at least three business days and up to 2 weeks.

Hence, telegraphic transfers remain the primary method for international money transfers due to their security, reliability, and swift processing time.

What are bank charges?

Bank charges are fees that banks impose for providing various financial services, such as account maintenance, fund transfers, and transaction processing. These charges help banks cover the costs of delivering services. Banks may levy charges on a fixed basis, or as a percentage of the transaction value, depending on the service type, account type, and the bank’s fee structure.

What are the different types of bank charges?

Bank charges come in several forms. Common types include:

• Account maintenance fees: regular charges for keeping an account open, such as monthly service fees

• Transaction fees: costs for transfers, remittances, or payments. Cross-border transactions often incur higher fees

• ATM fees: charges for using ATMs outside your bank’s network

• Overdraft and insufficient funds fees: penalties for spending more than your account balance

• Foreign transaction fees: charges for using your card or withdrawing cash abroad

What are the advantages of bank transfers?

Bank transfers provide a secure, reliable, and cost-effective way to send and receive payments. They offer lower fees, enhanced security, and better transparency, making them a preferred choice for businesses and individuals.

1. Security and reliability, and convenience

Traditional banks are renowned for their solid reputation. Bank transfers provide a high level of security with strong encryption and authentication measures, reducing the risk of unauthorised access and chargebacks compared to credit card payments. Bank transfers also allow businesses and customers to complete payments online, via mobile banking, or at the branches.

2. Transparency and traceability

Some banks offer additional services allowing customers to track the status of bank transfers, enabling businesses to monitor incoming and outgoing payments in real-time. This allows businesses to identify delays, verify successful payments, and improve cash flow management. Bank transfers also leave a clear audit trail, making financial reporting and tax compliance simpler.

3. Reduced transaction cost

Credit card processors often charge businesses a percentage of each transaction, which can accumulate into significant costs over time. By using bank transfers, businesses can reduce these expenses and maximise their profits. Certain large international banks also have branches spread across various countries and regions. When processing cross-border transfers, these banks can process transactions within their internal network, which can reduce administrative costs and processing delays.

What are the limitations of bank transfers?

While bank transfers are secure and reliable, they come with certain limitations that can affect businesses and individuals. Factors such as transfer limits, delays, and exchange rates may create challenges, especially for large or international transactions.

1. Limited transfer amount

Many banks impose daily or per-transaction limits, depending on account tiers, transferred currency, bank policies, and local laws. These limits can restrict businesses from making large payments, potentially requiring them to split payments over multiple days. This can be inconvenient, especially for businesses dealing with high-value transactions or urgent supplier payments. For instance, HSBC sets a maximum daily transfer amount of HK$400,000 to unregistered payees. If the transfer exceeds the designated limit, remitters may be required to provide additional verification, such as transaction contracts and invoices as supporting documents.

2. Foreign exchange risks

International bank transfers, facilitated through services like SWIFT, are subject to exchange rate fluctuations. SWIFT enables secure and standardised international wire transfers but does not shield users from currency rate variations. The exchange rate at the time of transfer significantly influences the final amount received by the recipient,‌ leading to unexpected costs and affecting transaction value.

3. Cut-off times

Traditional banks typically process remittance applications only during office hours. Due to time differences and holidays between local and overseas banks, there might be delays until the next business day. It is important for businesses to plan transactions in advance to avoid payment disruptions and delays.

Generally, online banking remittances have later cut-off times compared to branch-based remittances. The table below outlines the cut-off times for remittance at selected banks. The cut-off times are based on Mondays to Fridays unless specified.

4. Bank transfer delays

Bank transfers, especially international transfers, may face processing delays. While domestic transfers are typically prompt, cross-border transactions can take several business days to reach the recipient. International transfers initiated at the end of the week, for example, may experience extended processing times due to weekend closures. Missing or incomplete paperwork can further prolong processing times, making it problematic for businesses needing timely transactions for payments.

5. Refunds and recalls

Unlike credit card payments, bank transfers are difficult to reverse once initiated. Resolving payment errors or disputes and recalling funds sent in error can be challenging and time-consuming. Banks usually require formal requests for payment recalls, and there is no guarantee that the recipient will return the funds. This poses a risk for businesses, especially when dealing with new suppliers or accounts.

Comparison of bank charges for bank transfers

When corporate clients initiate money transfers via a bank, they are typically charged a fee of HK$120–260 per transaction for online remittances. The charges for outward remittances conducted through branches can vary significantly across different banks, ranging from HK$0 to HK$270. Conversely, the standard fee for receiving remittances into an account is generally HK$50–60 per transaction, with certain banks offering fee waivers.

In addition to the aforementioned bank charges, banks may also charge different fees for other remittance-related items, including:

• Intermediary bank charges

• Handling charges for leaving a message to the recipient during remittance

• Additional charges for remittance instructions in Chinese

• Fees for status inquiry of the remittance

• Fees for confirming the remittance with the beneficiary's bank

• Fees for making changes, cancellations, and refunds

Moreover, businesses should be mindful of hidden discrepancies in exchange rates. Banks typically set their own currency exchange rates for remittances, which are often higher than the market rates. This is why, even if a bank waives the remittance handling fee, it can still generate profits from the exchange differentials, ultimately resulting in higher exchange costs for customers.

Why do traditional banks charge additional fees? 

Traditional banks charge additional fees for various reasons, including expenses for operational costs, regulatory compliance, service maintenance, and more. These fees help banks manage transaction processing and customer support. Common charges include account maintenance fees, overdraft fees, wire transfer fees, and foreign exchange fees, all of which contribute to the banks’ revenue. Additionally, traditional banks invest in digital banking services, security measures, and infrastructure, and branch operations, all of which are funded through continuous fees. While these charges can be frustrating, they help traditional banks sustain operations and remain profitable.

What are the options for business transfers?

Apart from traditional banks and virtual banks, Airwallex, the all-in-one financial platform, also offers fast and cost-effective international transfer services. 

Why should businesses leverage Airwallex for global transfers?

Airwallex's global transfer services offer competitive exchange rates and transparent fee structures, making it a preferred option for businesses going global.

1. Transparent fee structures

Unlike some traditional providers that may have hidden fees or unclear pricing models, Airwallex does not impose account opening fees, monthly charges, or other hidden fees. By clearly outlining all applicable fees upfront, businesses can gain a clear understanding of the costs involved in their transfers, without any surprises or hidden charges.

2. Fast global transfer service

Airwallex's efficiency and speed in processing transfers can also lead to business savings. With local payment rails worldwide, 95% of transactions can be completed in as little as one business day.

3. Cost-effective international transfers

Airwallex offers a cost-effective alternative to traditional bank transfers by leveraging local payment networks instead of the SWIFT system. This approach eliminates multiple layers of fees typically charged by remitting banks, intermediary banks, and recipient banks, allowing businesses to save up to 80% of FX fees.

Sign up now to streamline payments to suppliers and employees around the world.

Sources:

Information on banks was retrieved as of January 2025, and updated as of June 2025, from the sources below. Information provided is for reference only. Please refer to the official website of banks for the most up-to-date details

1. https://www.hsbc.com.hk/ways-to-bank/branch/express-banking/

2. https://www.bochk.com/en/crossborder/remittance/faq.html

3. https://www.business.hsbc.com.hk/zh-hk/regulations/services-cut-off-time

4. https://www.hangseng.com/content/dam/hase/en_hk/personal/banking-services/pdf/ortt_timetable.pdf

5. https://www.sc.com/hk/bank-with-us/remittance/

6. https://www.bochk.com/en/crossborder/remittance/charges.html

7. https://www.business.hsbc.com.hk/hk/regulations/commercial-tariffs

8. https://av.sc.com/hk/content/docs/hk-service-charges-en.pdf

9. https://www.citibank.com.hk/english/citibusiness/about-us/?lid=HKZHCBLCZLNTLABOUTUSCZLN

10. https://www.hangseng.com/en-hk/business/your-business-essentials/transfer-outward-remittance-faq/

11. https://www.sc.com/hk/bank-with-us/remittance/

12. https://www.hangseng.com/en-hk/business/tariff-business/

13. https://www.citibank.com.hk/english/personal-banking/pdf/useful-documents/service-fee.pdf

14. https://www.hsbc.com.hk/content/dam/hsbc/hk/docs/ways-to-bank/bank-tariff/20250501-guide.pdf

Disclaimer: The information was based on our own online research and we were not able to manually test each tool or provider. The information is provided for educational purposes only, and a reader should consider the specific requirements of their business when evaluating providers. This research is reviewed every six months. If you would like to request an update, feel free to contact us at [email protected].