Telegraph Transfer (TT): What is it and How is It Processed?
What is a Telegraph Transfer?
A Telegraphic Transfer (TT) is an electronic method of transferring funds from one bank account to another. It’s also known as a wire transfer or bank transfer. A TT allows the transfer of money from one bank account to another bank account, either within the same country or between different countries. They are commonly used for international transactions, as they offer a secure and reliable way to transfer large sums of money quickly and efficiently
Telegraph Transfer Example
Suppose Rahul wants to transfer Rs. 5,000 to his friend Shobhit, who lives in another country. Rahul visits his local bank and requests a Telegraphic Transfer of Rs 5,000 to Shobhit’s bank account. Rahul provides his bank with the following information:
- The name of the beneficiary (Shobhit)
- The beneficiary’s bank name and address
- The beneficiary’s bank account number
- The beneficiary’s bank’s SWIFT/BIC code
Rahul’s bank processes the transfer and sends the funds electronically to Shobhit’s bank account. The transfer typically takes one to three business days to complete, depending on the countries involved and the banks’ processing times.
Once the transfer is complete, Shobhit’s bank credits the Rs 5,000 to his account.
How Does Telegraphic Money Transfer Work?
Telegraphic transfers involve sending money from one bank to another and then passing it on to the intended recipient.
Because the banks that are participating in the transfer, commonly referred to as correspondent banks, set their own prices and processing periods, telegraphic transfers are typically more expensive than other transfer services. Due to this, transferring money between people and businesses can be expensive and time-consuming. The processing period for a transfer is typically 2-4 days.
Payments can only be sent between banks that have business contacts with one another. Hence this network is crucial.
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How to Make a Telegraphic Transfer?
- Step 1: The first and most important step is to make sure if your bank allows you to do a telegraphic transfer.
- Step 2: If you’re making the online telegaphic transfer, you’ll need to log into your online banking and look for the telegraphic transfer section. Banks refer to this service under different names, so look for something along the lines of ‘Telegraphic Transfer’, ‘International Payment’, ‘Wire Transfer’, or ‘Send Money Oversea
- Step 3: If you are transferring money from the bank, make sure you take your bank details, as well as the recipient’s details; you’ll need to provide their name and basic bank details – often an IBAN and BIC/SWIFT code, but your bank may also require their address, and even their bank’s address, so be prepared.
- Step 4: Your respective bank should be able to tell you the fee they’re charging, but the bank may also deduct their fee directly from the payment as they process it.
- Step 5: After you are satisfied with the parameters of the transfer, you can confirm it and the money is on the way to the receivers.
What is the Time Limit and Cost Involved in Telegraphic Transfer?
Time Limit in Telegraph Transfer
Telegraphic transfer mostly take 3-4 business day to reach the recipient banks, but it also varies to country to country depending on the origin and destination of the transfer as well as the currency exchange requirements.
Cost Involved in Telegraph Transfer
TT payments are generally expensive because there are multiple fees associated with a single transaction, including those assessed by the bank handling the transfer, correspondent banks acting as intermediaries as your money travels across borders via the SWIFT network, a currency spread or markup added to the exchange rate, and fees assessed to the recipient by their bank. Also, keep in mind that the teleraphic transfer buying rate differs based on the currency.
How Fast are Telegraph Transfers?
The amount of time necessary to complete a Telegraphic Transfer, just like the fees, varies depending on whether the transfer is conducted using CHAPS or SWIFT.
The time it takes to complete a CHAPS money transfer might range from a few seconds to as long as two hours, depending on the circumstances. As a result, it is utilised in circumstances in which there is a race against the time in a domestic transaction.
As mentioned, completing a telegraphic transfer via this technique often takes anywhere from two to four days, this happens because a SWIFT transfer is more involved and may have to travel through more than one bank.
What is the Role of Banks in Wire Transfer?
- Transferring Bank: According to the customer’s instructions, the ordering bank starts the wire transfer process. To be eligible for a wire transfer, the ordering bank must verify that the customer has accurately submitted all required information (remitter’s information). Before processing the request for a wire transfer, the bank must confirm the data.
- Banking Intermediary: The intermediary bank involved in the wire transfer procedure must maintain a record of every transaction and ensure that the information is accurately included in the request.
- Beneficiary Bank: The beneficiary bank must ensure the transaction has all of the sender’s information and the specifics of the amounts sent. Certain standards, like Know Your Customer and anti-money laundering, must be followed by banks (KYC).
You can always approach your bank with the transaction reference number if there is a delay or a problem. As soon as a wire transfer transaction is started, the sending bank gives the sender a transaction reference number. Financial institutions can use this reference number to check the transaction’s status.
Remittances sent across international borders are subject to several rules and limitations. Banks carry out their own due diligence as well. Telegraphic transfers make it possible for you to send money to India successfully, conveniently, and with little hassle.
Difference Between Telegraph Transfers and Bank Transfer
| Telegraphic Transfer | Bank Transfer |
| A telegraphic transfer is a means to move money electronically via the financial system from one bank account to another.. | A bank transfer is a form of payment or transfer to someone’s account that is carried out through a bank. |
| Telegraphic transfers are mostly for international transactions | Bank transfers are mostly for domestic transactions |
| Expensive and takes longer time | Inexpensive and faster |
What are the Benefits of Telegraph Transfer?
Convenient: The only thing you need to do for making a telegraphic transfer is to use the services of your bank. This makes telegraphic transfers quite convenient. You can even start the transfer from your bank’s browser or the app.
Risk-free: Telegraphic transfers are a dependable and risk-free method of moving money from one party to another. Even the transfer of significant sums of money can be done in a secure manner.
High limitations: In contrast to other methods of transmitting money, like payments in cash, telegraphic transfers are the most appropriate means to move vast quantities of money and have high limits because of their capacity to accommodate such transactions.
What are the Drawbacks of Telegraph Transfer?
1. Expensive
Since the payments move through many banks, the sender may wind up paying significant costs in the form of exchange rate margins, landing fees, and other expenses.
2. Time Consuming
The major disadvantage is that processing payments, that can take some time. Payments may occasionally need to pass through many banks before they reach their receiver, especially with overseas transfers, which might cause delays.
Final Word
A Telegraphic Transfer is a safe and reliable way to send money or receive large amounts of money within India or abroad. Before you make the tt payment, it is safe to verify with your bank about TT payment terms and other concerns.
FAQs
Money transfers are unlike parcel deliveries, where you can follow the approximate position of your delivery. You can also request a trace through your bank with a bit of additional work. They’ll only notify you if the money has been deposited. You’ll need your 16-20-digit Federal Reference number. SWIFT’s latest cross-border payment technology (SWIFT GPI) allows you to track your payment at any time. Track your payments end-to-end in real-time on the SWIFT website.
Due to the fact that this method of transferring money operates on an electronic level, it is one of the safest ways to send money. You will have a simpler time tracking it and knowing how much cash is transferred as well as when you can expect to receive it. Additionally, you are able to start a TT at any time and in any location.
A telegraphic transfer, also known as a TT, is typically the quickest option when sending money to a foreign country. In most cases, the delivery will reach the beneficiary within one to two business days. However, because of the interconnected nature of the banks, there are no guarantees. It is more cost-effective to send a TT in the recipient’s currency. It eliminates the need for days to be spent converting or clearing funds, which results in rapid crediting of cash.
Although the specific processes differ from bank to bank, the telegraphic money transfer procedure is generally the same. The steps you must take to make a payment are as follows:
• Check your bank’s website to see if you can perform telegraphic transfers online. You should be able to do this by phoning your bank or visiting their website.
• Log in to your bank account to access the section for telegraphic money transfers if your bank permits you to make this form of payment online. This might be referred to as a “wire transfer,” a “telegraphic money transfer,” or some such word. Visit your local branch if your bank does not let you make this kind of payment online.
• Examine the costs and conversion rate before sending. Telegraphic money transfers necessitate sending funds through matching banks, which may not always be the same as your own. Although you may be aware of your bank’s fees, keep in mind that you can also be liable for the relevant bank fees. A good moment to check the currency rate is now.
• Specify the relevant details: Give your recipient’s name and, if necessary, their address. Additionally, you’ll need their basic financial information, like a SWIFT or BIC code.
Telegraphic Transger is the full form of TT in banking.
Disclaimer
This article is solely for educational purposes. Navi doesn't take any responsibility for the information or claims made in the blog.
