Last week I wrote about my experience getting denied by an online bank with an international wire transfer. I talked about the importance of figuring out if your bank allows these wires because if you need them in a dire situation, it’s going to be too late and your loan is going to go unpaid or your emergency is going to be difficult to fund.
I found it odd that the big banks – Chase, Bank of America, Citi – all accepted these wires, but the online banks – Ally, ING Direct, FNBO Direct – didn’t. I’m sure a lot of people have been inconvenienced by this fine print rule and it just doesn’t seem like something that the state-of-the-art online banks would omit from their banks.
So when researching the last post about international wire transfers, I asked FNBO Direct why exactly they didn’t accept international wire transfers. They were kind enough to write back with this answer:
“Since FNBO Direct is an online bank, we need to be able to validate the source of all funds. As an on-going effort to fight money laundering, funds from outside of the US are difficult to confirm and validate. Therefore, we currently do not process any incoming or outgoing international wires.”
Let’s look at FNBO’s rule a little closer.
Online banks are efficient. They don’t like customers that require a lot of attention and are willing to cut their loses if it means making things easier overall. It seems like an international wire transfer is a pain in the butt for banks to deal with. It probably requires a couple of people to work on the transfer and this isn’t a justified use of company time for them.
They have too much to lose. The biggest fear of any bank customer is if your bank misplaces your funds. We trust our banks and if they lost my money, I would be shaken. Like the customer service rep said, “[these funds] are difficult to confirm and validate.” There’s a lot of shady activity that goes on with internationally with money. People trying to beat exchange rates, money launder, and avoid taxes are just the tip of the iceberg. For the amount of work involved and the chance of a huge problem arising, online banks would rather just not deal with this wire.
Online banks are still small. Most are efficient, but this usually means 1 worker is doing a lot of jobs. They don’t want to add on “Person in charge of international money wires” to someone’s job description and they certainly don’t want to hire new workers – inefficient use of money – to be in charge of these wires. Not enough people in the business means they can’t answer every request and this is one that probably isn’t an issue that often, at least compared to other banking issues.
This Has to Change
And I hope it’ll be soon. The world travelers out there are using online banks and I’m sure these banks get a good amount of complaints about not only no accepting international wires, but also not really advertising it all that well. In the previous post about international wires I still can’t locate the prices behind every banks international wire fee.
I understand that it’s a lot of work for these banks to accept the wires, but it’s something they need to do.
I’m disappointed in ING Direct for denying our wire, making the process go on another week, and costing me an extra $10 to re-send the wire to my big bank. Should I have checked it out before hand? Of course. But it’s not like they had this information on the front page of their website.
I, like a lot of people who get denied, assumed it was common place for an online bank – who are so up-to-date with how people use their bank accounts and money – to allow me to send money from an international account to an American online savings account.
Bottom line: it needs to change, but who knows when it will.
Have you had any issues with international wire transfers? Share your stories in the comments and let us know what your banks are doing about them.
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