Why is my bank transfer delayed? 6 potential reasons

Whether it’s a payment you’re making or expecting to receive, delayed payments can cause a lot of exasperation, especially around the holiday season. Unfortunately, this issue is a common hiccup that comes with running a business.

Even more than just being an annoyance, a delayed payment can have a tangible impact on your business, both financially and in terms of your brand. From not being able to make bill payments on time and getting hit with a fee, to being unable to process payroll and get your employees their paychecks, the impact is noticeable. It can also negatively affect your business’s reputation.

So why are bank transfer times often so slow?

There are a few reasons, but let’s first look at what’s happening during your bank-to-bank transfer and the time it typically takes, if we’re going by standards.

How long do bank transfers usually take?

Although having a set timeframe for bank transfers would make running a business easier, there is, unfortunately, no globally defined timeframe for when a transfer should occur. These days, a bank transfer can take anywhere from one to 10 business days.

And a business day, as it’s generally understood, isn’t a vague idea. It‌ actually has a legal definition.

The US Code of Federal Regulations (CFR) defines a business day in section 31 C.F.R. § 802.201 as: “Monday through Friday, except the legal public holidays specified in 5 U.S.C. 6103, any day declared to be a holiday by federal statute or executive order, or any day concerning which the US Office of Personnel Management has announced that Federal agencies in the Washington, DC, area are closed.”

So, at least in the United States, a business day is considered any day on which business would typically occur.

Based on this, you can already see one reason your bank transfer time feels slow or you’re experiencing a delayed payment. Public, bank, and government holidays might be stalling its progress.

Let’s look at some of the more surprising reasons that affect your bank transfer times, how this can result in a delayed payment for your business, and ways to minimize the negative impact.

1. Global events

Unsurprisingly, global events – primarily geopolitical or environmental – can affect the time it takes for international bank-to-bank transfers.

While your bank will likely be providing regular updates as the situation evolves, most banks have advised their clients to expect delays. These can be due to limited staff, staff working under alternative arrangements, or unforeseen staffing interruptions.

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

2. Bank holidays, even those in other countries

As we mentioned earlier, banks operate under the legal definition of business days, which means they close on public holidays such as Christmas Eve and Christmas Day.

As bank transfer times only count business days toward your transfer period, these holiday times don’t count toward this, even if you started the transfer before 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 one week.

So, if you transfer money to either of these countries during this time, you can expect a delayed payment, as it only moves forward on business days.

3. 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.

According to the business day rule, bank transfers made over the weekend won’t start 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.

Even though a Sunday might be considered a weekend in the US, other countries may not see it that way.

For example, while US workers typically see the workweek as Monday through Friday, that’s not the case around the globe.

Afghanistan recognizes the work week as Saturday through Wednesday, and the United Arab Emirates operate on a Sunday to Thursday working week, with their weekend taking place over Friday and Saturday.

4. Different time zones and bank cut-offs

Money transfers can be at the mercy of various human factors along their journey. While this is true, another element to examine is the difference in time zones around the world.

If you’re starting an international money transfer at the end of your workday, you need to understand that this will add extra time to your transfer. Your transfer typically won’t be sent until the morning of the next business day.

For our Canadian and Mexican business partners, time zones don’t present too big of a problem. They operate mainly within the same time zone range as the United States. But for countries with a significantly different time zone from the US, such as Australia and China, this becomes a trickier issue.

For example, a payment processed at midday in New York is equivalent to 4 am the following day in Australia. So when calculating business days, you need to factor in the time on the receiving end of your transfer.

5. Your bank transfer is made via the SWIFT network

The SWIFT payment network is a messaging network that many financial institutions use to send international transactions. This banking infrastructure securely transmits information and instructions for transactions through a complex and standardized system of codes. This helps businesses as well as individuals send and receive electronic payments regardless of the bank that they use.

The number of SWIFT payments processed daily reached nearly 50 million messages by the end of 2022.

Needless to say, SWIFT is one of the more popular tools for international payment processing. However, because the SWIFT process passes through several intermediary banks before reaching its destination, it can cause significant delays.

A SWIFT payment can take anywhere from 24 to 48 hours and up to five business days.

6. There’s sometimes just…missing paperwork

Sometimes, as much as you want to pinpoint the cause of your delay, you don’t know what’s going on behind the scenes of your international transfer’s journey.

Depending on where you’re sending money, different countries have their own unique regulations, rules, and required documentation.

China, for example, requires proof that the source of the money is legal and has been obtained legally.

Humans fill out the paperwork for these different requirements, which means there is always a chance for error. Even if everything on your end is perfect, there's no way to ensure that each form is correctly filled out or properly filed.

Missing documentation or information on a form can lead to significant delays in your payments, so it’s something to factor in if time is of the essence.

3 alternative ways to try to avoid bank delays

1. Leverage local payment networks: Instead of relying on international wire transfers (such as SWIFT), which can be delayed by bank cut-offs, global events, and bank holidays, consider using a financial service that operates through local payment networks in multiple countries. Airwallex's extensive local licences and infrastructural coverage ensure faster processing times by avoiding typical cross-border transfer delays.

2. Use digital payment platforms: To circumvent the delays caused by weekends and bank cut-offs, digital payment platforms like Airwallex allow for instant transfers. By using a digital platform, funds are transferred efficiently without the constraints of traditional banking hours or time zones.

3. Opt for multi-currency accounts: Delays often occur when converting currencies during international transfers. By using a multi-currency account, such as those offered by Airwallex, you can hold, manage, and send money in multiple currencies without needing to convert each time. This not only speeds up the transaction process but also reduces the costs associated with currency conversion. Not all multi-currency accounts are created equal, though – look out for truly local accounts (with local bank details) versus accounts in non-local currencies.

How Airwallex can help with business bank transfers

Airwallex is designed for the speed and flexibility required in the modern business world.

While some of the examples mentioned above can’t be helped, Airwallex’s global financial system ensures that any unnecessary delays won’t hit your international payments.

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