What is a telegraphic transfer?

Tilly Michell3 minutes
What is a telegraphic transfer?
In this article

In 2021, 1 in 3 Singapore-based businesses expressed confidence in expanding internationally. Because sending and receiving money overseas is essential for global businesses, it’s worth understanding the nitty-gritty of different methods to ensure miscellaneous costs aren’t compromising your profit margins.

If you’re managing money in multiple currencies, sending it overseas or even making domestic payments, you’ve probably already used a telegraphic transfer without hearing its old-fashioned name.

Also known as a telex transfer, or a TT, this electronic transfer method is used to send money both domestically and abroad. TTs are often referred to generically as wire transfers, overseas transfers or electronic fund transfers.

Although they are still used digitally today, telegraphic transfers have a long history. Telegrams and telex messages were the original text messages, sent electronically and then passed to the reader in physical form. In the past, banks would use these systems to communicate and arrange bank transfers.

While the telegraph itself is now obsolete, this was the foundation for the system we currently use. Today, funds are transferred electronically via secure cloud-based apps or cables connecting banks, but the name remains. 

How do telegraphic transfers work?

When you send a telegraphic transfer, the payment passes through several networked banks to reach its destination. 

In the UK, one type of telegraphic transfer uses a network called the Clearing House Automated Payment System (CHAPS). CHAPS payments are typically carried out on the same day, for high-value or time-critical transactions.

Internationally, money can be transferred by telegraphic transfer via the Society for Worldwide Interbank Financial Telecommunication (SWIFT). For this reason, the terms telegraphic transfer and SWIFT transfer are sometimes used synonymously. 

SWIFT was launched in 1973 to make it easier to send money overseas, standardising the system to make it quicker and less error-prone. 

In Singapore, instant payment service Fast and Secure Transfers (FAST)––which most of us are familiar with––taps SWIFT for domestic interbank transfers.

How long does a telegraphic transfer take?

A telegraphic transfer typically takes 1 to 4 business days to complete. This is subject to factors such as time differences and the number of intermediary banks involved. For same-day transfers, the sender has to note banks’ cut-off timings, which are contingent on the financial institution and country.

How do you send money via telegraphic transfer?

To dispatch money via telegraphic transfer, the sender needs the account numbers and routing numbers of the recipient and their financial institution. Personally identifiable information (PII) is also required to confirm the identity of the sender for security purposes.

If you’re sending money internationally, you may need the recipient’s IBAN number or SWIFT code. These help ensure that the funds arrive in the correct bank account.

The required recipient particulars differ between countries too. For instance, transfers to Mainland China need the recipient’s identification number and address as well. It is advisable to have these details on hand to ensure smooth and fast transactions.

Most financial institutions will allow users to send telegraphic transfers by logging into their online banking account and doing it directly. If you are sending money abroad, look for the tab indicating “overseas transfer”.

What are the fees associated with telegraphic transfer?

Telegraphic transfers are fairly expensive and can involve hidden costs: senders aren’t aware of the full price until the transfer is complete. Fees depend on exchange rate spreads that can be up to 3.5% above the interbank rate, as well as levies imposed by sender, intermediary and beneficiary banks. 

For certain Singapore-headquartered banks, you can be prepared to pay commissions of 0.125% of the remitted amount or up to 100 SGD. That’s on top of other cable charges, agent fees and processing fees. 

Airwallex offers cheaper, faster international transfers

TT payments may no longer require sending telegrams, but they are still based on a centuries-old system. 

Luckily, traditional financial institutions are no longer the only option when it comes to cross-border transfers. The digital revolution is here, and Airwallex is at its core.

Airwallex uses a network of local banks and payment routes so sending money around the world is faster and cheaper for businesses. With our Global Account, you can hold, send and receive 11 currencies and counting—including USD, Euro, GBP and HKD

Or, make international payments to 130 countries in more than 40 currencies, with no minimum transfer fees. This surpasses local banks’ basic remittance services offering slightly over 10 currencies.

And unlike banks which charge added fees for non-account holders, recipients who do not hold Airwallex accounts can accept transfers at no added cost. 

With individual virtual wallets for each currency, you can also guard existing funds against unpredictable FX fluctuations without incurring monthly fees. Even better, use our multi-currency virtual payment cards so anyone in your team can carry out business activities, wherever and whenever.

Airwallex offers competitive rates of 0.4% or 0.6% above the interbank rate. And because we bypass the SWIFT network where possible, your money will usually be received within one business day or less.

Send international payments with $0 TT fees and market-leading FX rates

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Tilly Michell
Content Marketing Manager

Tilly manages the content strategy for Airwallex. She specialises in content that supports businesses in their growth trajectory.

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