Various factors, including global events, natural disasters, different currencies, weekend delays, missing documentation, time zone differences, and more, can cause problems with money transfers.
If you are facing difficulties with a transfer, it’s essential to understand why instead of attempting to resend the transaction repeatedly. We discussed some of the most common reasons for issues with money transfers with representatives of the British fintech company Payrow.
— Incorrect Sort Code or Account Number
Typing errors in sort codes and account numbers are common causes of payment issues. Mistakes can happen when we input these long strings of numbers. Even a single incorrect digit can result in the funds being sent to the wrong recipient. In most cases, if incorrect payment details are entered, the payment is sent back.
In terms of both local and international bank transfers, entering incorrect payment details can cause a considerable delay in the transfer time. To avoid this delay, you should always double-check the name and details of the recipient’s account number before processing any payments.
If you realise you have made an error, it is essential to notify your financial institution as soon as possible. Payrow recommends contacting support immediately to cancel the transaction and increase the chances of successfully stopping the payment.
— Payment Delays
Money transfers are usually processed immediately, but certain factors can cause delays of up to two hours, and sometimes payments can end up arriving overnight or even the next business day. These factors include the timing and location of the transfer, the currencies involved, security checks, bank holidays, and the reason for the transaction.
Global events and natural disasters can also lead to delays in international bank transfers due to limited staff and changing working arrangements. Bank holidays and cut-off times should also be considered as bank transfer times only include business days and exclude all public holidays.
Weekend delays can also occur as most bank transfers made then will be processed on the next business day. When making international bank transfers, it is important to consider the weekends observed in the country where the money is being sent to ensure a timely transfer.
— Issues with International Payments
Converting currencies during international bank transfers can often result in delays. The processing time for the transaction can vary based on the country you send money to and the currencies involved.
Missing documentation is another issue that can cause significant delays for international bank transfers. Each country has its unique requirements, which can be quite complex to navigate. Failure to provide the necessary documentation can lead to major delays in processing.
Time zone differences can also play a critical role in determining how long it takes for an international bank transfer to be completed. When sending money to a country with a significant time difference, the process can take much longer.
— Challenges with Cross-Border Transactions After Brexit
UK businesses are encountering various difficulties in conducting international transactions following Brexit. The UK’s departure from the EU and EEA means that payments between the UK and EEA countries are no longer classified as intra-EEA payments under PSD2 regulations, which means that the principal amount on affected wire payments is no longer safeguarded against deductions or claim backs. Some European banks now view SEPA credit transfers and direct debit transactions between the UK and Europe as cross-border transactions and impose additional bank charges. While opinions on this issue differ, complaints have been filed to industry bodies and national banking communities to highlight the increased costs.
However, fintech Payrow is confident that these payment issues can be resolved. For instance, Payrow’s service allows payments through FPS and SEPA with no extra commissions between the UK and EU countries and no additional fees. The customer only pays a commission fee according to their tariff plan. Additionally, Payrow utilises modern technologies and has a professional team capable of swiftly grasping the specific challenges that businesses face with cross-border payments. This blend of technology and expertise enables the company to provide businesses with effective solutions to alleviate the impact of Brexit on their payment processing.
— Fraud prevention procedures
When initiating an international wire transfer, banks must follow extensive fraud prevention procedures. For instance, the SWIFT network mandates that each transfer provide information on up to three correspondent banks before reaching its intended destination. Additionally, once the funds have arrived at the destination, the recipient’s bank may have fraud prevention procedures, which could further delay the payment.
Furthermore, to comply with anti-money laundering regulations, we must provide as much accurate information as possible about the recipient before a payment can be processed. This can be particularly challenging for companies with complex ownership structures, such as startups, which often have new investors and beneficiaries joining during project development.
Payrow recognises the difficulties businesses with complex ownership structures face and has a specialised team ready to serve them. With over three decades of experience in both corporate and fintech environments, the team is well-equipped to understand and address the unique needs of these businesses.
— Financial service error
Sometimes, issues can arise from the financial service provider’s side. In such cases, the initial step is to request the sending bank to provide proof of the transaction.
If the financial service can provide evidence that the payment was made, they should conduct an investigation and attempt to retrieve the missing funds. Reporting the error is also critical if this happens.
If the financial service cannot recover the funds immediately, they must investigate and inform the person who initiated the transaction within 20 days. Additionally, the bank should inform us about the available options if the funds cannot be retrieved.
How Fintech Helps Businesses Cope
It’s no secret that payments can sometimes be a headache, whether due to human error, technical glitches, or even fraudulent activities. However, the good news is that financial services are constantly working to improve their systems and processes to make payments more secure and efficient for their customers.
According to Payrow, while payment issues may still occur, financial services are doing their best to provide transparent and efficient solutions for their customers. By choosing a reliable provider and promptly reporting any issues, you can help ensure your payments are secure and hassle-free.
