International payment methods for Pakistan: SWIFT wire transfer
June 2nd, 2011Sending money abroad and receiving payments from foreign companies or individuals is surprisingly difficult in Pakistan. There are many factors that come into play including the cost of the payment method, time it takes to transfer the amount and acceptability of the payment method to the foreign party. In this post I look at SWIFT wire transfer and discuss its advantages and disadvantages.
SWIFT Wire transfer
SWIFT is an encrypted messaging standard used to transmit wire transfer instructions by banks around the world. Using the SWIFT system you can transfer money to almost any country on the planet.
Receiving Wire transfers: I have previously blogged about receiving wire transfer payments in Pakistan. Receiving SWIFT wire transfer is easy as it only requires a bank account. Even a rupee account will suffice.
Sending wire transfers: Sending a wire transfer is a whole different story. You need a foreign currency account to be able to send a wire in your own name. Some foreign exchange companies can wire money on your behalf but then the money is sent in their name and that is often unacceptable to foreign companies.
Cost of Wire transfer: In terms of cost, wire transfer is quite expensive. There are sender’s bank fees, correspondent bank fees and recipient bank fees. Sending a wire transfer costs between $15 and $25 in Pakistan. Outside Pakistan that amount can be much higher. Around $50 in the US for instance.
In Pakistan banks generally don’t charge any fees for receiving wire transfers. However, they do make money off the currency conversion. US and European banks do charge customers to receive an International wire.
The hidden cost is often the correspondent bank fees. These banks help route the money to its destination and they can charge arbitrary fees without the sender or receiver knowing or consenting to it. In the past I have lost as much as $65 to correspondent banks.
As a result of all these bank fees it is impossible to say exactly how much the recipient will get in a SWIFT wire transfer transaction. IMO this is the biggest disadvantage of wire transfers.
Wire transfers are only recommended for transactions of at least $1,000. The bank fees involved make smaller transactions impractical.
Speed of wire transfer: SWIFT wire transfers take between 1-4 days to be credited to the recipient’s account. So wire transfers are a very fast payment method.
Security of wire transfers: Wire transfers are also a very safe payment method. Both the sender and receiver must have a bank account at a legitimate financial institution. The SWIFT messaging system uses cryptography to transmit wire instructions between banks. Wire transfers are also not reversible without the recipient’s explicit authorisation. So there is no risk of chargeback or payment reversal as in the case of credit cards.
i hv a question…i want to trade forex and i wanna transfer money…the broker accepts money only through webmoney,LR and bank wire transfer…plz help me can i transfer money through swift wire transfer to my broker account?plz guide me..
yeah, i have also a forex account abroad and they accept payment by paypal money bookers or wire transfer, for depositing funds , u must have a foreign currency account here in pakistan and then u can easily transfer money to your broker’s bank account by wire…
yes u can….reply me if you need more help. which broker u use for trade?
i need help.i plan to use oanda.com broker.
please confirm ,
1-can i send and receive money via wire transfer to a company account outside Pakistan?
2- which bank would you recommend for opening a fcy account.
3-Are you a forex trader? yes? which broker ?
reply please.
Please see the links posted in response to previous comments above. Your questions are answered there.
BTW I am not a forex broker. Whatever gave you that idea???
Please see the article posted above. Your questions are answered there.
BTW I am not a forex broker. Whatever gave you that idea???
My question was for Mr.Zubairee… he is a forex trader i believe.
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another question for you is
…”if the sender is a company then according to State Bank of Pakistan rules your earnings must be credited to a Pakistan rupee account”
Now what will happen if a company sends a wire transfer (us $) to my fc account in pakistan ? can i receive the funds ? the amount is for my fc account not rupee account.
will the bank convert the $ into Rs. then again into $ ? (i will loose money as the bank will buy the $ for something like 90.4 each and sell it back higher like 91.5)
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The problem with Forex brokers is that Funds must be withdrawn by the same method used to deposit money into your account. For example, if you deposit funds into your OANDA account via bank transfer, withdrawals will be sent via bank transfer back to the same account.(in my case my fc account..)
Ahmed, OandA offers a money transfer service and you can withdraw to any account of your choosing. If you took the time to ask *them* that they would have told you the same thing. I suggest you email them. They have a customer support desk you know?
If you receive USD (or any FC) from a company into a USD/FC account your bank will refuse to accept the funds. The funds will be returned to the sender. Alternatively, if you also have a *rupee account* with the *same* bank your bank may offer to divert the wire to your rupee account. You will be asked to write a letter requesting this diversion of funds.
thats not the case atleast with FXCM, due to anti-money laundering policies they allow wire transactions withdrawals/deposits with one account only.
Mr Ahmed`s question is legit, i have never traded forex from pakistan cuz the banking here is really not upto the mark
title=”I want guidance”>
Hi all,
I am a contractor on http://www.odesk.com and I want to transfer funds to my Allied bank current account via SWIFT wire transfer.
The branch of the bank, in which I have opened my account has not a recognized SWIFT Code. May , I use the swift code of another Allied branch to transfer funds.
Secondly , how long wire transfer would take?
You should confirm what I write here with allied bank management but, generally speaking, you can receive funds using the head office swift code and the bank will take care of routing the money to your account at your branch. Wire transfer usually takes just one business day but it may take up to 3-4 days.
Dear Abdussamad! i need ur help&guidence, plz can u tell me how can i verify my SCB/HBL debit cards on moneybookers, whenever i tried they say “recent card deposits have failed as your bank did not authorize our debit requests” i’ve account in PKR and tried to deposit to MoneyBookers in USD. International bank transfer is lengthy nd not suitable for less than $1,000/-
Plz help
I really need some easy and cheap money transfer methods. But SWIFT does not seem to be so.
I need to send more than 5 Million Pakistani Rupee to a United Kingdom Bank. How i can send this big amount ? Are there some restrictions of State Bank involved?
There are no restrictions if you send the money from your own foreign currency account.
Appericiated.
I have a launched a new company in HONG KONG,
NOW I intend to transfer some money from my personal Pak rupee account to my company’s account there but the banks refused to do so in the light of State Bank rules.
I need your help to kindly state & please qoute the reference through which rule it is so.
You will need a foreign currency account to transfer money abroad.
And you wanted me to refer you to SBP rules:
http://www.sbp.org.pk/fe_manual/chapters/chapter6.htm
Dear sir, I have a question. I am a us national. 2 years ago I decided to shift to Pakistan. I brought about $400,000 to buy a house. Now I am moving back and I have sold my house. I have converted my money to $ and put it in a FC account. How do I transfer this amount back to my account in US. Your help is greatly appreciated. Does State Bank gets invoke in this case?
Thanks
Thank dear really worth reading. You know mod of transaction is really big issue for Pakistani small business industry.
Government should take action on this issue.
Thanks
where i creat account to receive us$
Hi! I read your article. But I am bit confused about sending wire transfer from pakistan.
Do you by any chance that to wire around $3k from Pak to Us hiw much approximately would cost? And what conversion rates do the use?
Wire transfe from either ABL or anyother bank to USA costs?
Brother,
I am actually paying to a company outside Pakistan as an importer. so which method would be best for me to adopt. If incase there product are substandard, so can i return my moneyback in any bad suitation? kindly waiting for your responce, have a nice day ahead THank
You need to use a Letter of Credit.
Sirrr….
I have opened a live account in FXCM and now i want to transfer $100 as my initial deposit to my account for trading. i have a current account in Al-Habib bank, Kharian Branch. They disappointed me about wire transfer of funds.
please give me a proper guideline
u cant send wire to fxcm from pakistan, for trading with fxcm just open a current account with standard chartered and use credit card for deposits/withdrawal.
fxcm also demands debit card. can i transfer my deposit through HBL debit card
should i open a foreign currency account in Standard charterd and then transfer my funding.
Please reply me as soooon as possible
Please read the article above again. Specifically the bit about:
Salam!
I need advise on how to do telegraphic transfer from Pakistan to HongKong? The organization is asking to do telegraphic transfer with my name only. I do not have Forex account in Pakistan. Is there any solution? Regards.
Nope. You need a foreign currency account to send outward wire transfers in your name. Exchange companies can do it for you but then the transfer will be in their name.
Hi Abdussamad,
If i open a USD Foreign currency account in ABL and show them proof of my earnings in dollars on letter-head of the company operating in USA and get it transfer from that company to my bank account in Pakistan via Wire transfer, while i am living in Pakistan.
is it possible? Bank told me that its OK to do that. is there any problem in doing so?
Hey if the bank says it’s OK then it must be OK. It would be great if you let us know how it worked out.
I have visited the bank, The bank only asked to provide proof of funds in USD and after some necessary processings and approvals from back-end, (might be SBP) FC account will be operational and then i can have incoming wire transfer in USD.
I will visit the bank on Thursday now and then let you know. Tx
Let us know after you receive the funds. I’d love to be able to receive wires that are realized in USD.
Hi
We have an IT company having software reseller status for number of foriegn software. We sell software and get payment from companies in Pak rupees but we have to send payments to principle companies in dollars. what is the best way. If we have a dollar account in pakistan with company name how to add dollars in the account to send payment from this acount as wire/TT.
You can buy dollars from the open market. Just go to any exchange company and buy dollars in exchange for rupees. You can then deposit that money into your FC account and send a wire transfer to your upstream supplier.
However, importers usually use Letters of Credit to remit funds abroad. You should look into that as well.
Hi, I was wondering which bank you use to send wire transfers? Some banks (Meezan) refuse to send any wire transfers unless its from a company account.
Any bank that restricts you from sending wire transfer abroad from your foreign currency account is breaking SBP rules. See my comment above about it:
http://abdussamad.com/archives/333-International-Payment-methods-for-Pakistan:-SWIFT-Wire-transfer.html#comment-81235
You have not mentioned that which bank is providing this facilities to receive money
Almost all banks in Pakistan support it.
I transferred money by swift 8 days before, but not credited yet. all the information correct regarding my benificery.
kindly advice
swift goes through instantaneously. ask your bank for the actual swift message
We want to trade on Tokyo Commodity Exchange (TOCOM) in futures contracts.
How to remit (transfer) the funds in JPY or USD to Japanese brokers for the purpose of margin deposit/settlement (either through cash settlement or through physical delivery) futures transactions, etc.
The process is the same for every country on the planet. So read the article above and if you have a question not answered there you can ask it in the comments.