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4 Ways to transfer money from one bank to another

In the age of online banking, you're probably familiar with money transfers.

It's a pretty simple concept—type in the amount you wish to transfer, select a recipient, and watch the money whoosh away from your account. That works fine when you're transferring money to other people, but can you transfer money from one bank to another?

Fortunately, you can! However, bank-to-bank transfers can differ from person-to-person ones, so there are a few extra things to look out for. Master these, and money transfers can become second nature.

Keep reading to find out how to transfer money from one bank to another.

What is a bank-to-bank transfer?

Bank-to-bank transfers are just what they sound like—ways to transfer money from one account directly into another. These are also known as external transfers since they require one bank to send a transfer outside its internal network.

Today, bank-to-bank transfers are typically electronic, which is particularly handy for those who need their money transferred as quickly as possible. Because there's no need to physically shift cash between banks, most transfers require very little time to complete. Plus, most transfers can now be done using a phone or computer, eliminating the need to visit the bank.

Because of their speed and convenience, electronic bank-to-bank transfers are the preferred method for most money transfers today.

The point of bank-to-bank transfers

Sure, bank-to-bank transfers are convenient, but what purpose do they actually serve? The truth is, this type of money transfer can be used for lots of things.

Bank-to-bank transfers make it easy to send money to friends and family, no matter which bank they use. Paying bills can also be a cinch when all you need to do is tap a few buttons to make your payment.

At some point, you might find a new bank that offers no monthly account fees and a host of other benefits. When this happens, you'll probably want to close your existing bank account. But before you do that, you'll need to transfer money between banks—an easy feat with a bank-to-bank transfer.

What to consider before a bank-to-bank transfer

Transferring money from one bank to another is a simple concept in theory, but it's not to be taken lightly. As with all financial exchanges, it's important to make transfers carefully to avoid mistakes. One wrong tap, and you risk sending your payment to the wrong person.

Additionally, not all transfer methods work the same. Because of this, there are a few things to keep in mind to get the most out of your bank-to-bank transfer experience. Here's what to consider before you press send.

Transfer speed

Bank-to-bank transfers are usually pretty quick. That being said, some methods are faster than others.

If convenience means more to you than speed, you can take your pick of any bank-to-bank transfer method with no problem. But if you need your money transferred ASAP, you'll have to be more careful with your selection.

Before making a transfer, take the time to check its estimated arrival. If it's too far out, it may be a good idea to opt for a different transfer method.

Fees

In some cases, you may be charged a fee to complete a bank-to-bank transfer. Certain methods, such as wire transfers, charge fees for dealing with large amounts of money. Others, like certain apps, almost always complete instant transfers for free.

Sometimes a transfer method might offer its services both for free (with a longer processing time) and paid (with instant processing). When this happens, it's up to you to decide whether or not the speed is worth the cost.

It's a good idea to compare fees before you make a bank-to-bank transfer, especially if you're new to the process. That way, you minimize your risk of paying for a service you could've gotten for free.

Know your recipient

The last thing to consider before making a bank-to-bank transfer is who you're sending your money to. Your recipient could be a friend, family member, or colleague. In some cases, your recipient might even be yourself (more on that later).

Depending on how you decide to make the transfer, you could need key information from your recipient. Some of these might include their:

  • Full name

  • Routing number and account number

  • Phone number

  • Email address

The information you have about your recipient could limit the transfer methods you can use. For example, you can't complete a wire transfer without both the routing number and the account number, and you probably can't use certain transfer apps without an email or phone number.

When making a bank-to-bank transfer, make sure to have this information ready to go in advance. That way, all that’s left to do is enter the dollar amount and press send.

How to transfer money from one bank to another

Now that you know what to keep in mind before making a bank-to-bank transfer, it's time to choose your transfer method.

There are four easy ways to complete an external transfer, and all but one can be done completely electronically. Each one varies in terms of speed, price, and required information, but all of them are convenient. Here's what you need to know about each one before making any transfers.

1. Wire transfers

Wire transfers are typically used to send large amounts of money. They're also one of the fastest methods you can use, especially considering the large-scale transfers they deal in.

However, their quick speeds tend to come at a price. Wire transfers usually have fees of up to $30 for domestic transfers and up to $50 for international transfers.

Even if you can cover the fee, you're not quite ready to make a wire transfer. You'll also need to gather the recipient's account and routing numbers, along with their full name.

This process might seem extensive, but it's the reason why wire transfers can send so much money so quickly. Once the bank has all the information, they'll get your money to its destination in a matter of minutes.

2. Mobile apps

Third-party transfer apps have grown in popularity over the past several years. These apps provide a quick way for individuals to exchange money between bank accounts using just their phones.

For the most part, users can access these services for free, though some may charge fees for same-day transfers. One of the benefits of using a third-party app is that they often don't require much information about the recipient other than their name or phone number.

While they may be similar, mobile transfer apps all have their own set of rules. To make sure you aren't stuck with any unwanted fees, it's a good idea to get familiar with an app before you try to make a quick transfer.

3. Email money transfers

Email money transfers, or EMTs, are typically offered by banks or financial institutions themselves. Basically, they give users a way to send money between personal accounts using email addresses.

When an EMT is sent, the money is usually delivered through a transfer network, like Zelle® (which is available in your Varo app¹). These transfers can take up to a few days to arrive, and the recipient will be alerted by email as soon as the money hits their account.

EMTs generally don't charge recipients to have money transferred to their accounts. However, you might need to pay a small fee to send a payment.

4. Writing a check

Writing a check is a pretty traditional way of transferring money from bank to bank, but sometimes old-school methods just can't be beat.

Unlike some transfer methods, checks don't charge any fees to send or deposit. For those who aren't so technologically minded, a check can seem simple and straightforward. Plus, if your recipient isn't familiar with electronic transfers, you won't spend hours showing them how to sign up.

Personal checks aren't free, but once you have them they can last a while depending on how frequently you use them. Checks also tend to clear no later than the next business day, which can be faster than some mobile apps, and with electronic deposits, your recipient can cash their check using a phone, so no one has to visit the bank.

The pros of an external bank transfer

The biggest advantage of an external bank transfer is that it saves you and your recipient a trip to the bank, and when you're busy with work and personal life, a trip to the bank can feel like mission impossible.

Bank-to-bank transfers are particularly useful when transferring large amounts of money in a short period of time. Even small payments are made simple with fee-free transfers that deposit in seconds.

Ultimately, convenience is what makes instant external transfers such a popular choice today. Even with small fees or delayed transfer times, there really is nothing better than not going to the bank.

Transferring money to yourself

Plenty of people have accounts at more than one bank. If you're one of them, you know the hassle that is moving money back and forth. Luckily, external transfers can speed up the process.

If your banks accept email money transfers, you can usually use these to send money from one account to the other. For this, you shouldn't need more than your phone number and email address.

However, e-transfers aren't the only way to move your funds around. You can go the low-tech route and write yourself a check from one bank to the next, then cash your check with an online deposit.

What to watch out for: savings and withdrawal limits

Up until April 2020, transfers and withdrawals from savings accounts had a federal limit of six per month. Now that the rule has been eliminated, you're free to move funds around as you see fit.

However, some banks have their own limitations when it comes to taking funds out of your savings account. If you go over their limit, you might be penalized with a fee. To avoid this, get familiar with your bank's policies before you make too many withdrawals or transfers.

Bank-to-bank transfers in a nutshell

Bank-to-bank transfers are the go-to method for quick money sharing. Nowadays, there's little need to withdraw physical cash or even visit the bank at all.

External transfers can vary based on their speed, cost, and the amount of information they require. With so many methods to choose from, finding one that meets your needs is simple. Above all, it's convenience that keeps people coming back to external transfers again and again.

Looking for a bank that makes transferring money easy? Now that Varo has partnered with Zelle®, instant transfers are only a tap away. Open an account at Varo today and find out what it means to have a bank work for you.

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