The ability to transfer funds between accounts at different banks is a useful way to help you get money where it needs to be — whether it’s into your own account or someone else’s.
Transfer costs and speed are important considerations when choosing the best transfer method, and the two are often linked. Getting money where it needs to be in the quickest way can also be the most expensive method.
What are bank-to-bank transfers?
A bank-to-bank transfer, also known as an external transfer, is the process of getting funds from an account at Bank A to another at Bank B. External transfers that are electronic or utilize the internet can expedite getting money to someone else by eliminating the need to physically move cash between banks.
Things to consider before transferring money
When choosing a method to send money to another person:
- Think about speed: Determine how quickly the money needs to arrive at the other bank.
- Compare fees: Sometimes a wire transfer might be needed for sending large amounts of money quickly, but it likely won’t be free. Other methods, such as Zelle, can be both fast and free.
- Know the recipient’s account information: You’ll probably at least need the recipient’s name, routing number and account number for some methods. But for Zelle, you only need the person’s phone number or email address.
After deciding on speed, cost and what sending options you have, you’re ready to make a money transfer.
Here are four ways to transfer money from your bank to another institution.
1. Wire transfers
A wire transfer is one of the fastest ways to transfer money electronically from one person to another through a bank or a nonbank provider such as Wise, formerly TransferWise.
For a domestic wire transfer, you’ll need the routing number, account number, the name of the recipient and possibly the recipient’s address. A domestic wire transfer can be set up online or at a branch or office.
Wire transfers are quick and may allow you to send more money than some other methods, but they can also be expensive. Domestic wire transfer fees averaged $26 in Bankrate’s November survey of banks.
Keep in mind your bank might have a weekday deadline for wire transfers, and they can’t be sent on weekends or bank holidays.
2. Mobile apps
Banks aren’t the only option for sending money. PayPal, MoneyGram, Western Union and other third-party companies are also considerations. PayPal customers don’t incur a fee when moving money from PayPal to their bank accounts.
Fees for international transactions typically are higher, and an exchange-rate fee may apply on transfers made in a foreign currency.
3. Email money transfers
Your bank’s app might offer a service, such as Zelle or Popmoney, that allows you to send money electronically to someone else using their email address or cellphone number. Transfers can take seconds or a few days, depending on the method selected. A fee or additional charge may apply for instant transfers. Apple Pay, Google Pay, Samsung Pay Cash and Venmo are other ways to send money to others using an app.
4. Write a check
A traditional way of transferring money between banks is by writing a check and depositing it either at a bank branch, online, through a mobile app or by mail. A money order can be used instead, though some bank’s websites and/or apps lack the capability to deposit a money order. Funds can also be transferred using an official check, also known as a cashier’s check, and deposited the same way a standard check is. A fee may apply for the purchase of an official check or money order.
What are the benefits of external bank transfers?
External bank transfers allow you to transfer funds between banks or send funds to another person without having to visit a branch or ATM.
An external transfer can be useful for moving funds, for example, from a high-yield savings account held at an online-only institution to a checking account at a brick-and-mortar bank. Having a checking account at a brick-and-mortar bank provides access to a branch — an important consideration for some consumers, while the online bank allows them to earn higher yields on savings that a traditional bank may not offer.
Money can also be transferred from a checking account to a bank or credit union that offers multiple savings accounts, or buckets, allowing consumers to set distinct savings goals.
Transferring your money to yourself at a different bank
Many consumers have accounts at more than one bank and sometimes need to transfer money from one account to one at a different bank.
Some options are setting up an external transfer or using a service such as Zelle. Some lower-tech options are writing a check to yourself or withdrawing cash from one bank and depositing it into another.
Be aware of savings withdrawal limits
The Federal Reserve deleted a rule in April 2020 that restricted the number of transfers and withdrawals from savings deposit accounts, which include savings accounts and money market accounts.
Even though this requirement no longer applies, your bank may restrict the number of transactions in these accounts, and exceeding your bank’s withdrawal limits could result in a fee.
An external transfer is a quick and easy way to funds from one account to another. It’s important to research transfer options to know how much they cost and how long it can take for the funds to get where they need to me. If you frequently need to move money between accounts urgently, setting up a practice transfer can help familiarize yourself with the process and help alleviate the stress you may experience when needing to transfer funds quickly.