How Does Money Transfer Work?

Money transfer is the exchange of funds from one bank account to another. It gets done physically or electronically. It occurs in different countries, within the same region, between the same bank operators, different bank operators. This is the act of transferring money in the same country or overseas from one place to another. When it happens in the same country known as the domestic transfer of money and when it occurs in abroad known as an international or global transfer of funds.

Money remittance is essentially used for electronic transfer of funds. This is the cashless mode in which money is moved from one bank account to another.

How does money transfer work?

Money transfer by mobile apps or online money transfer gets achieved in elementary steps.

  • Visit a local agent or service provider.
  • Register your remitter account by name, mobile number and give him cash.
  • You will get an OTP to your mobile number by authenticating your remitter account.
  • Now, you must provide bank details including name, account number and IFSC code of the receivers.
  • Agent must sign the recipient’s account
  • Fill the amount you would like to send to the recipient’s account
  • Now the agent receives an OTP, and after sending an OTP, transactions take place
  • Get transaction receipt from the agent

Some years ago, the transfer of funds was only carried out by banks by physical transfer of money. Money remittance service is advancing as the technology is growing. In India, there are many places where banks can’t reach. Banks start a policy to bring all of society on the same financial platform. They provide you with authority to use international money transfer facility.

Disadvantages of a money transfer facility

  • To transfer the money, you may need to pay a small piece of the amount to banks. Sometimes you need to pay an extra small amount to these services when using online money remittance services in return for online fund transfers. But that’s not a big problem, because you can quickly transfer money using these services.
  • Often hackers manipulate your data when you use credit/debit cards to perform financial activity online. They can steal your machine ID and password and can use it to hurt your bank account.
  • Those without the bank account struggle to pay and receive payments
  • It’s not the worst customer service, but it’s not very good. If your account is suspended, your assets will be frozen, and unfreezing them could take months.

With all the choices around us, there is no ideal way for foreign remittance. Each money transfer service strives to be as comfortable as possible. You want to evaluate the resources at your disposal to see which one meets your safety, transfer rates, and efficiency criteria.

You can do online money transfer through mobile banking apps. Most banks have the facility and you can use it sitting in the comfort of your home.

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