Bank of America International Wire Transfer: Fees and Rates revealed

Joao Marcos

Bank of America has a presence in Hong Kong. However, the services on offer here are designed to suit corporate customers and high net worth individuals. That means you’ll find corporate banking, investment banking and treasury management solutions, but not regular retail banking¹.

For most customers looking to send an international wire from Hong Kong, Bank of America won’t be an option. The good news, though, is that there are plenty of other ways to get your money where it needs to go - including cheaper, faster online services like Wise.

This guide covers all the basics about international money transfers, including the wire transfer fees you need to look out for when selecting a provider. Let’s get started.

Wire Transfer: Meaning

A wire transfer is an electronic payment method, which is usually used to send money directly from one bank account to another. You can send local and international wire transfers, although the fees for an international bank wire transfer can be fairly high. Some providers also allow customers to arrange a wire transfer in person and pay in cash. Again the costs here tend to be higher than payments initiated online.

How Traditional International Wire Transfers Work

Before we move on to look at the costs of sending a wire transfer overseas, it’s useful to understand a bit about how banks typically move money abroad.

Most traditional banks arrange international payments using the SWIFT network. The SWIFT network involves a series of banks around the world working together to route international payments. Your money moves step by step to the destination account, much like taking a series of connecting flights.

Up to 3 banks can be involved in routing one payment - which can result in relatively slow transfer times. Even worse, each bank - as well as the recipient’s own bank - can charge a fee for the service they provide. This is deducted as the payment is processed, and can mean your recipient gets less than you expect in the end.

It’s helpful to know that not all payment providers rely on the SWIFT network. Modern alternatives like Wise take a smart new approach which avoids SWIFT - and the associated costs - entirely. More on that in a moment.

International Wire Transfers - the fees to look out for

To illustrate the way regular international payments work, let’s look at some examples. We can’t use Bank of America Hong Kong, because they don’t offer retail banking. Instead, let’s compare a few of the biggest local retail banks to see how they do on a payment to the US.

A cost example: Sending HKD5,000 from Hong Kong to the US (USD)

ProviderFeesExchange rate (1HKD=USD)Recipient will receive
Traditional bank #1 - HSBCHK$500.128513USD636.14 - potential SWIFT costs
Traditional bank #2 - Hang Seng BankHK$650.128750USD635.38 - potential SWIFT costs
Traditional bank #3 - BEAHK$1000.128883USD631.53 - potential SWIFT costs

*Fees and exchange rates correct at time of research - 18 September 2020

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You’ll notice a few things:

  • The transfer fees for different providers vary widely
  • Exchange rates are not consistent
  • Your recipient may receive more or less, depending on the transfer service you choose

What this means in practise is that you need to shop around when finding a provider to make an international payment. Look at the upfront fees, but also check if the payment is routed using SWIFT, to avoid surprises. You also need to look carefully at the exchange rates used, to make sure you’re getting a good deal.

Don’t forget: check the exchange rate

Our example above is a neat illustration of how much difference a bad exchange rate can make to your payment. But how do you know what a good rate looks like?

The way to check and compare the exchange rates available from different providers is to get an online currency converter - or run a simple Google search - for your currency pairing. This will bring up the mid-market exchange rate.

The mid-market rate is the one banks and currency providers use when they buy and sell currency to each other. But it’s not often the rate they offer retail customers. Instead, they’ll add a markup to the rates used for regular international payments. This is an extra fee, but it’s not always obvious. It’s also the reason some 78% of Hong Kongers don’t know the true price of sending money abroad².

Don’t get caught out by a poor exchange rate. Check the exchange rate your provider is offering against the mid-market rate to see if there is a markup. Or choose a provider like Wise to keep things simple with transparent fees, and the mid-market rate every time.

How long does it take for an International Wire Transfer?

International wire transfers routed through the SWIFT network are likely to take a few days to arrive in their destination. The exact length of time will vary according to the destination, and the processes in place at the recipient’s bank, but you can expect to wait something in the region of 3 - 5 working days for many payments.

Which currencies and countries can you transfer money to?

Different banks offer a different range of available currencies for international payments. Major currencies are usually fairly easy to send, but for exotic currencies you may need a specialist.

Check out the currencies and countries covered by Wise here.

A cheap, fast and transparent alternative: Wise

When it comes to sending international payments, traditional banks aren’t always the best option. Cross border transfers aren’t core business for regular banks - which pushes up the cost, and can mean payments are routed through slow and cumbersome systems.

Take a look at Wise as a smart, cheap and safe alternative for sending money abroad. You’ll be able to make payments all over the world without ever needing to visit a bank branch, and your money could arrive faster, too.

Click here and open your free account now! 🚀

Wise payments can be up to 8x cheaper than with banks - which is why 8 million people already trust Wise to make their own remittances and international transfers. See if you can save with Wise today.

Sources used in the article:

  1. Bank of America - Hong Kong

  2. Fintech News HK - 79% don’t know the true cost of international money transfer

Sources last checked on 23-September 2020.

This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from Wise Payments Limited or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date.

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