Advantages of international wire transfer
1) Simple procedures
The biggest advantage of international wire transfer is that it is convenient and fast, which makes it occupy the most important position among many traditional cross-border remittance methods. First of all, as long as the bank card number and name of the domestic company or individual are told to the overseas customers, they can directly remit the money to the domestic account. Secondly, this remittance method is also vigorously promoted by banks because they do not need to bear any credit risk, but the handling fee is considerable. Wire transfer is completely based on the business reputation of both parties. If a large number of overseas customers use wire transfer to pay remittance, it indirectly reflects that the cooperation period between the two parties has been long and the business is stable. The company and the other party adopt the wire transfer settlement method, which is also based on the premise that the other party is a long-term cooperative familiar customer.
2) Wide coverage
In addition to the simple operation, the ubiquity of international wire transfer as a remittance method is also a major reason. The coverage of wire transfer can be said to be quite wide. Take Bank of China’s global wire transfer as an example. Bank of China now has overseas branches in many countries and regions, covering a wide range.
3) Fast arrival of funds
Under the floating exchange rate system, the exchange rate often fluctuates greatly, and the time for receiving and paying foreign exchange by telegraphic transfer is relatively short, which can reduce the risk brought by exchange rate fluctuations to a certain extent. Therefore, when conditions permit, the company should try to require overseas customers to remit funds by telegraphic transfer in the trade contract. In addition, commercial banks also use international telegraphic transfers when balancing foreign exchange transactions and allocating foreign exchange, and speculators also use international telegraphic transfers when speculating in foreign exchange.