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Wire transfer fees explained: Costs, types and how to reduce them

Last update:

January 26, 2026

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International business payments are now part of the routine for UK businesses that buy, sell or pay suppliers abroad. As volumes rise, so do costs. Recent analysis values the global cross-border payments market at about US$222.2 billion in 2025, reflecting the amount of money that moves across borders each day.

Recent industry reports show that banks often add hidden markups and extra fees to international payments, which pushes total transaction costs to 3–8% once you factor in FX spreads, intermediary charges and wire fees.

This guide breaks down wire transfer fees, compares domestic and international costs in the UK and outlines practical steps to reduce charges, making global payments more predictable and cost-effective. It would also present WorldFirst as an alternative to a bank, and how an international business account can keep those transfer fees low.

Key takeaways:

Banks often charge more than the upfront fee: Wire transfers collect costs at multiple stages, including FX markups, correspondent bank deductions and receiving-bank charges
Exchange rates usually account for the highest cost: Many banks widen the gap between the mid-market rate and the rate they offer customers, often adding around 2–5% to each conversion. Even a slight difference can meaningfully increase the total cost of paying overseas suppliers or receiving foreign revenue
Routing and accuracy influence both speed and price: International transfers often move through several correspondent banks and each stop can add fees and delay. Accurate payment details, direct bank relationships and efficient routing help reduce both timing issues and extra charges
There are clear ways to reduce wire transfer fees: Businesses can lower costs by using multi-currency accounts, batching transfers, negotiating FX rates, choosing the right SWIFT fee option, using local rails such as SEPA or ACH and locking in favourable rates with forward contracts
A modern payment solution helps keep costs predictable: Open a World Account to reduce wire transfer fees with competitive FX rates, local receiving accounts and transparent, upfront pricing that avoids unnecessary international charges

How wire transfer fees work

What is a wire transfer?

A wire transfer is an electronic movement of funds from one bank account to another. In the UK, domestic transfers use systems such as Faster Payments, BACS or CHAPS.

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CHAPS (Clearing House Automated Payment System) is the UK’s high-value, same-day domestic payment scheme. Faster Payments and BACS handle most everyday UK transactions (Faster Payments settle in seconds, BACS in 1–3 days).

International wire transfers usually travel via the SWIFT network. SWIFT does not move the money itself; it sends secure payment messages between financial institutions. Funds often pass through several correspondent or intermediary banks before reaching the recipient, each of which may charge its own fee.

How wire transfer fees work

A wire transfer collects fees at several points along the way from the sender to the recipient. Here is the typical flow:

1. Sender’s bank charges a fixed fee

The payment starts with an upfront charge from the sending bank. This is often the smallest part of the total cost.

2. FX margin added to the exchange rate

Many banks widen the gap between the mid-market rate and the rate they offer to customers. Industry research often places this margin at 2–5% of the transfer amount, meaning the exchange rate can be the highest cost in the transaction.

3. Correspondent banks deduct handling fees

If the sender and recipient banks do not have a direct relationship, the payment moves through one or more correspondent banks. Each bank may deduct its own fee. Banks vary these charges by corridor and currency and rarely disclose them in advance.

4. The recipient’s bank may apply an incoming fee

Some banks charge a fee for receiving international transfers, reducing the final amount received.

5. Currency shifts can affect the amount received

If the transfer takes time to clear and the currency moves, the value received may fall even further.

This flow shows how costs stack up at several points. A payment that seems simple at the start can lose value through multiple small deductions before it reaches the final account.

Types of wire transfer fees

Understanding the different fee categories helps you identify where money is lost:

Upfront transfer fees

Most UK banks apply a flat charge when you send an international payment. The fee depends on the bank, the currency and the payment route. Online transfers often cost less than branch transfers because they require less manual handling.

This fee stays the same regardless of how much you send. Larger payments are more cost-effective than sending several smaller transfers.

Exchange rate markups

When you send or receive money in another currency, the bank converts it using a rate that may sit above the mid-market rate shown on currency charts. This difference is the bank’s markup. Because the conversion applies to the full amount, it often becomes the highest cost in an international payment.

Even a slight percentage shift in the rate can add up quickly, especially when paying overseas suppliers or settling high-value invoices. A bank may charge a low upfront fee, yet the FX margin can still make the total cost far higher than expected.

Intermediary bank fees (SHA, OUR, BEN)

Many international transfers go through one or more intermediary banks when the sender and recipient banks do not have a direct relationship. Each intermediary may deduct a handling charge before passing the payment on.

The sender selects the charging method:

SHA (shared): the sender pays the sending fee and the recipient covers intermediary and receiving fees
OUR (sender pays all fees): the sender covers all charges, so the recipient receives the full amount
BEN (recipient pays all fees): the recipient covers all charges

Most payments default to SHA. Businesses paying suppliers may choose OUR to ensure they pay the full invoice amount to the recipient, though some banks charge an extra fee for selecting this option.

Domestic vs international fees in the UK

UK domestic transfers are relatively cheap compared to international transfers. As the table below shows, standard UK schemes have minimal charges, whereas SWIFT wires incur higher fees and delays:

Scheme	Approximate cost	Settlement time
CHAPS (same-day, UK high-value)	~£20–£30 per payment	Same business day
BACS (batch payments)	Usually free or very low	Up to 3 business days
Faster Payments (instant)	Usually free or very low	Seconds (24/7)
SWIFT (international)	£5–£25 flat fee + correspondent fees	1–4 business days

Sources: UK banking payments guide

Factors determining total transfer cost

Several factors influence what you ultimately pay for a wire transfer:

Currency pair: Common currencies (USD, EUR) have well-trodden routes, but exotic or less-traded pairs often incur higher markups and more intermediaries. If your GBP payment to an Indian rupee account requires an extra hop, you may pay additional fees
Amount and frequency: Banks sometimes waive fixed fees for huge payments or high-volume customers. Conversely, many small transfers unnecessarily multiply fixed fees. Some services also offer better FX rates for larger amounts
Speed/urgency: “Urgent” or same-day transfers often cost extra. A Bank of England study notes that payments routed through multiple intermediaries can be slower and more expensive. If you need instant settlement outside Faster Payments hours, you may pay a premium
Routing and relationships: If the sending and receiving banks have a direct SWIFT relationship, fees can be lower. If not, one or more correspondent banks step in and add charges. Bigger banks often have wider networks, reducing the need for intermediaries
Bank policies: Each bank sets its own fee schedule and FX margin. This can also depend on the specific account (e.g., corporate vs personal) and negotiation
Regulatory factors: Transfers to some countries trigger additional compliance checks (and time), which can delay settlement. Time zone differences and cut-off times also affect when your money moves and the rate you get
Hidden FX exposure: The timing of the exchange rate matters. If you instruct a payment but it settles days later, market movements could mean you get less foreign currency for the same amount of pounds, effectively an extra cost

How long do wire transfers take in the UK?

International transfers move at a different pace than domestic UK payments because they often involve more banks, more checks and more time zones.

Processing times shift based on cut-off hours, public holidays and the number of banks involved. When sending money overseas, planning for a 1- to 4-day delivery window gives your business greater certainty and reduces the risk of payment-related delays.

Are wire transfers safe? Security and regulation in the UK

UK banks and payment providers operate under a layered supervisory structure that keeps payments secure and well governed. Oversight comes from three core authorities:

Financial Conduct Authority (FCA) – regulates payment services, FX providers and customer-facing conduct. Sets rules for safeguarding client money, transparency, fee disclosures and anti-money laundering controls
Prudential Regulation Authority (PRA) – supervises the financial soundness of banks and larger institutions, ensuring they hold sufficient capital and manage risk effectively
Bank of England – oversees the UK’s payment infrastructure, including CHAPS and RTGS and sets standards that promote resilience across high-value and systemically important payment systems

These institutions work together to guarantee that UK payment services remain secure, transparent and reliable for businesses moving money domestically or internationally.

How to reduce wire transfer costs

Businesses can significantly cut wire fees by taking practical steps:

Compare providers: Don’t assume your current bank is the cheapest. Many fintechs (and even specialist FX brokers) offer far better rates. Therefore, always check the total cost (fixed fee + FX margin). Even a small percentage saving can add up on large transfers
Use multi-currency accounts: If you regularly deal in certain currencies, hold them in a multi-currency account (such as World Account). This lets you avoid unnecessary conversions. For example, if you invoice in USD and also have USD costs, keep the funds in USD and pay out in USD – no GBP step needed
Batch your transfers: Combining several smaller payments into one larger transfer can save multiple fixed fees. Be mindful of any daily or per-transaction limits, but sending in bulk can reduce per-transaction costs
Pay and invoice in the same currency: If possible, negotiate with your overseas partners to use your local currency. If a supplier can invoice you in GBP, you avoid any FX markup. Conversely, if customers pay you in foreign currency, keep it in that currency until needed
Book forward contracts: When FX rates are profitable, lock in favourable rates for future payments. This not only hedges risk but can also ensure you do not miss a good rate window. Many providers offer forward contracts with terms of 1–2 years
Leverage local payment rails: Use local transfer schemes when possible. For example, WorldFirst provides local Euro or USD bank details – so a payment sent via SEPA (in EUR) or ACH (in USD) may bypass SWIFT and its fees entirely
Optimise fee-bearing options: When using SWIFT, choose wisely who pays the fees (OUR, BEN, SHA). ‘OUR’ means you absorb all correspondent fees up front, ensuring the beneficiary gets the full amount. ‘BEN’ makes the recipient cover them (often unpopular). ‘SHA’ splits fees. Depending on trust and negotiation, you may agree with a supplier or customer on the best arrangement
Shop or negotiate rates: Especially for large payments, ask your bank for better pricing or use a broker. The FCA’s transparency rules require them to tell you the markup, so use that leverage to negotiate or switch
Keep detailed records: Ensure all payment instructions are accurate. A mistaken detail can delay a transfer (which may incur new fees) or even result in rejection charges

How WorldFirst helps reduce wire transfer fees

World Account from WorldFirst tackles these pain points directly. As a payment provider – and not a bank – it gives your business one platform to manage international payments, hold 100+ currencies and send funds through local payment accounts, all in a way that simplifies your global operations.

Key features include:

Free and transparent: The World Account is free to open and has no monthly maintenance fees. WorldFirst charges no incoming payment fees and no charges for same-currency transfers between your own balances
Competitive FX rates: WorldFirst keeps its FX margin low at 0.6%, compared with the 3–4% charged by many high-street banks. This means you get closer to the mid-market rate on conversions. For example, using WorldFirst to convert currency on a £10,000 transfer would cost roughly £60 (0.6%), versus £300+ at a 3% bank margin
Local currency accounts: You receive dedicated local bank details in major currencies (USD, EUR, GBP, CNY, JPY, etc.). So customers or partners can pay you via a domestic bank transfer (Faster Payments in GBP, SEPA in EUR, ACH in USD, etc.), often at little or no bank fee. This bypasses the SWIFT network (and its charges) entirely
Forward contracts: You can lock in exchange rates up to 24 months in advance, providing cost certainty and protecting against rate swings
Real-time visibility and control: WorldFirst’s online tools let you see exact fees and rates before you commit. This transparency aligns with FCA best practice
Dedicated support: WorldFirst offers 24/5 support with FX specialists who can advise on timing and execution

WorldFirst aims to turn complex international payments into local transfers whenever possible. As an alternative to a traditional business bank account, you avoid most correspondent fees, pay no hidden markups and can execute payments exactly when you want at pre-agreed rates. This approach significantly reduces total costs compared to sticking with a traditional UK bank.

Want more control over wire transfer fees as your business grows internationally?

Open a World Account for free today and use local bank details to receive funds without unnecessary intermediary deductions.

Sources:

Shawn Ma leads business development at WorldFirst UK, with a deep expertise in fintech, risk management and cross-border commerce.

Shawn Ma

Author

Head of Business Development, WorldFirst UK

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