Online money transfer services have become popular across the world. They have made life easy since money can be transferred almost instantly throughout the globe. However, most of these bank transfer services have their own limitations.
Have you ever sent someone money and experienced delays? Well, if that’s, the case, then you are not alone. Many people experience delays when sending or receiving money, particularly when the transactions are of international nature.
Below are five common reasons for delays:
- Unfinished KYC documentation
All financial institutions across the world are required to abide by the local laws and regulations within their jurisdictions. International money transfer companies have a duty to ensure that all transfers passing through their platforms are genuine and that there’s no fraud.
That’s the reason why you will always be asked to provide several documents when signing up for various transfer services. Some of the documents you will be asked to provide include the following:
- Bank statements
- Passport
- Photographs
- Phone number, proof of address, utility bill among others
- Bank holidays
All banks operate under the legal definition of business days. This means that they don’t operate during weekends and public holidays. It doesn’t matter whether your bank transfer method tells you that you will receive the money within two days, if the second day falls on a holiday, then you will have to wait until the day after.
Additionally, you need to be aware of the country you are sending the money to and the types of holidays they normally celebrate. For example, China and Japan have the Golden week that comprises a series of holidays throughout the week.
- Incorrect or missing information
In case you are sending funds and in the process enter incorrect information, your payment is likely to delay. A delay can also happen if you fail to adhere to the policy requirements provided by the online transfer service.
In the worst-case scenario, you may end up sending money to the wrong person. Getting a refund for such money is not easy and you might not even be able to reverse the transaction.
- Mandatory regulatory checks
Other than the KYC verification process, the company processing the payment can again conduct extra checks relating to anti-money laundering or anti-fraud. All these checks often lead to delays in processing the payment.
Anti-fraud compliance checks are normally triggered if the recipient’s or senders name has been flagged in one or more databases.
- Bank cut-offs and different time zones
When you are sending money to regions with different time zones, there are bound to be delayed for hours or even days. For example, if you want to send money to the Philippines, then you need to find out the difference in time vis-à-vis your country to avoid delays.
In a nutshell, money transfer services are beneficial in many ways. However, they also have several challenges like delays in receiving funds. There are many reasons why you are likely to experience delays and understanding such a reason can help you adjust accordingly.
Disclaimer: This content does not necessarily represent the views of IWB.