- Posted by Joe Campbell on December 2, 2018 in Banking Global Money Transfer
International money transfer, the process of transferring money overseas – has a language of its own. This article will help you decode the financial garble in order to make your global remittance easier
There are plenty of things to think about if you’re transferring money overseas. The most useful thing you can do is become familiar with the jargon you’re likely to hear, so here are the key international money transfer phrases and acronyms, decoded.
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Account number: The identification number for your account, or for the account to which you are transferring money to. When making a money transfer, you will need to know the transferees full name, address, account number, and Branch Number or Bank Identifier Code.
ADI (Authorised Deposit-Taking Institution): An Australian institution authorised and accredited to provide banking services and receive and manage deposits in customers’ accounts.
Appreciation: An increase in the value of a currency.
Balance: The amount of money remaining and able to be spent in your savings or transaction account at any point in time.
Bank account: An account held at a bank that a customer may use to manage their money. The account can be used to hold customer deposits as well as allow them to make payments.
Bank identifier: The component of an IBAN that indicates the bank. A bank identifier can be alpha or numeric digits, or a combination of the two.
Biometric verification: Any means by which a person can be uniquely identified by evaluating one or more distinguishing biological traits. At OrbitRemit, an online money transfer service we use a 2 step Biometric Verification process as a part of the sign-up process. You need to provide:
- Proof of address
- Photographic I.D
Cash collection: See pay a person.
Central Bank: A national bank or banking organization, usually independent of government, that provides banking and other financial services to its country or member states.
Confirmation: A written (electronic) document verifying the completion of a transaction. Also known as proof of payment. It includes details like:
- Commissions and/or fees
- Settlement terms
- The exchange rate
Conversion rate: Also known as the exchange rate.
Customer number: A unique identifier.
Deposit: To put money into a bank account.
Exchange rate: Also known as the conversion rate. An exchange rate is the price of a nation’s currency in terms of another currency. Thus, an exchange rate has two components, the domestic currency, and a foreign currency, and can be quoted either directly or indirectly. This is a particularly important rate to pay attention to when calculating how much your international money transfer is likely to cost! Exchange rates change daily, so please check our handy calculators to keep up to date.
Expedited: ‘Sped up’. A fancy term used by banks to describe premium transfer options that cost much more.
Foreign currency: The local currency of any country outside of your home country.
FOREX: Also known as FX. The foreign exchange market. The FOREX is the over-the-counter market in which the foreign currencies of the world are traded. It is considered the largest and most liquid market in the world.
FX: Also known as FOREX.
GST: Goods and services tax charged on purchases made in New Zealand and Australia. Certain internet purchases may also be subject to GST.
IBAN – International Bank Account Number: An account number that contains unique bank account information in a standardized format to improve validation when making an international money transfer.
Internet banking or online banking: Banking that is done via the internet on a computer or mobile device.
IRD: Inland Revenue Department of New Zealand.
MOJ: The New Zealand Ministry of Justice.
MSD: The New Zealand Ministry of Social Development.
Pay a person: A physical location available to a recipient that doesn’t have a bank account.
Payee: The party receiving a money transfer.
Payer: The party issuing a money transfer.
Proof of payment: See confirmation.
Recipient: The recipient of something is the person who receives it.
Remittance: The sending of money to someone at a distance. Usually involves exchanging funds from a foreign country to their country of origin.
Service Fee: Fee charged by a financial institution or FX provider to process a money transfer.
Source of funds: Where the money came from. Proof of source of funds can be required when making large transfers.
SWIFT: Acronym for Society for Worldwide Interbank Financial Telecommunication. It’s a security code. When sending or receiving an overseas payment, the SWIFT code identifies the receiving (recipient) bank or financial institution.
Transfer: To send money from one account to another.
Transfer fee: Any fee charged to convert one currency into another for providing the transfer service. This is where banks charge a fee at both the send and receive country. At OrbitRemit, we charge a single flat fee.
Transfer speed: This refers to the amount of time your transfer will take from your bank account to the recipient’s.
Transparency: The concept of a customer being able to view the breakdown of the costs associated with a transaction.
VAT: The Value Added Tax, or VAT, is a general, broadly based consumption tax assessed on the value added to goods and services in the United Kingdom.
Visa: A document from the government of a country that grants permission for a person to come to that country to holiday, live, work, or study.
Remember, all providers use slightly different acronyms or words to describe the functions associated with international money transfers
You should always read the terms and conditions carefully to understand what fees and charges may apply. Always refer to the product disclosure statement from your provider.
OrbitRemit is a unique online money transfer provider as it provides fast, flat-fee international money transfers, which are much cheaper than a bank.
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