Did you know that the value of cross-border payments is estimated to rise from nearly $150 trillion in 2017 to over $250 trillion by 2027, a staggering increase of over $100 trillion in just 10 years?

If you're sending money internationally, you're likely using the SWIFT network. But have you ever been surprised by unexpected fees or fluctuating charges when transferring money?

SWIFT transfers are widely used for business and personal payments, but the hidden costs can catch you off guard. SWIFT charges are far from straightforward, from varying bank policies to shifting currency exchange rates.

This guide will help you decode these fees so you can take control of your international payments. We'll break down the different types of SWIFT charges, explain who's responsible for them, uncover the factors influencing transfer costs, and share tips to help you avoid excessive fees. Keep reading to learn how to save more when sending money abroad.

What are SWIFT Transfer Fees?

In today's globalized economy, seamless cross-border transactions are essential for businesses and individuals. The SWIFT (Society for Worldwide Interbank Financial Telecommunication) network enables secure, standardized international money transfers. Used by banks and financial institutions worldwide, SWIFT ensures that funds reach the intended recipient safely, regardless of geographic location.

However, SWIFT transfers come at a cost, with various charges imposed at different transaction stages. These fees can vary based on the banks involved, the transfer amount, and currency conversion rates. Understanding the cost structure of SWIFT transfers is key to optimizing international payments and minimizing unnecessary expenses.

Also Read: Understanding Payment Transaction Processing and Types

Types of Fees in SWIFT Transfers

SWIFT transactions involve multiple charges at different stages. Each party handling the transaction may apply its fees, which can impact the final amount received by the recipient.

Outgoing Wire Transfer Fee from the Sender's Bank

When initiating a SWIFT transfer, the sender's bank charges a fee for processing the transaction. This fee varies based on the bank's policies and the urgency of the transfer.

1. Standard SWIFT Transfers: Transfers processed within 2–5 business days typically have lower fees.

2. Express Transfers: Faster transactions may cost more due to priority processing.

3. Bank-Specific Charges: Fees range from $10 to $50, depending on the bank and country.

Incoming Payment Fee from the Recipient's Bank

Some banks charge a fee for receiving international payments, reducing the final amount credited to the recipient's account.

1. Fixed Receiving Fees: Some banks deduct a fixed amount, typically between $10 and $30.

2. Percentage-Based Charges: Certain banks charge a percentage (e.g., 0.5%–2%) of the received amount.

3. Currency Considerations: Additional forex charges may apply if the recipient's bank converts the currency

Foreign Exchange Fee Associated with Currency Conversion

When a SWIFT payment involves different currencies, banks charge a forex fee based on exchange rates and markups.

1. Bank Exchange Rates: Banks apply their conversion rates, which include hidden margins.

2. Forex Markup Fees: Currency conversion can cost 2%–5% above mid-market rates.

3. Dual Conversion Fees: Some transfers undergo multiple conversions, increasing overall costs.

SWIFT Tracing Fee for Tracking Transfers

In case of delays or lost payments, banks offer a tracing service to track the transfer's progress.

1. Tracking Requests: Banks charge fees for investigating delayed transactions.

2. Estimated Cost: Depending on the bank, SWIFT tracing fees range from $25 to $100.

3. Time Factor: Tracing requests may take a few days to process, further delaying funds.

Also Read: Difference Between Swift Code and IFSC Code for Transactions

Who Bears the SWIFT Fees?

SWIFT transfers use specific fee-bearing codes that determine how the sender and recipient charges are distributed. The chosen option affects the total amount received.

Explanation of the Fee-Bearing Codes: OUR, SHA, BEN

Banks use three fee-bearing options to allocate SWIFT transfer charges.

1. OUR (Sender Pays All Fees): The sender covers all fees, ensuring the recipient gets the full transfer amount.

2. SHA (Shared Fees): The sender pays the outgoing fee, while the recipient covers intermediary and incoming charges.

3. BEN (Recipient Pays All Fees): The recipient bears all fees, including intermediary deductions.

Responsibilities of Each Party Involved in the Transaction

Depending on the chosen fee-bearing option, the financial responsibilities are distributed differently.

1. OUR Transfers: Best for ensuring recipients receive the full amount.

2. SHA Transfers: These are commonly used in business transactions where costs are split.

3. BEN Transfers:Suitable for cases where the recipient is responsible for all charges.

Each option affects the net amount received and the cost borne by either party. Understanding each party's responsibilities helps in choosing the most suitable option for international transfers.

Factors Influencing SWIFT Transfer Costs

Several factors influence SWIFT transfer fees, making cost estimation complex. Understanding these factors helps in reducing unnecessary expenses.

Variations in Costs Across Different Banks and Regions

Different banks and countries apply unique fee structures for SWIFT payments.

1. Bank Policies: Some banks charge flat fees, while others have percentage-based pricing.

2. Country Regulations: Regional banking laws impact transfer costs.

3. Currency Restrictions: Certain currencies involve higher conversion fees.

Also Read: SWIFT: The network powering international money transfer.

Factors Affecting Exchange Rates During Currency Conversion

The final exchange rate applied by banks affects the total cost of SWIFT transfers.

1. Market Volatility:Fluctuating exchange rates impact transfer amounts.

2. Hidden Markups:Banks add margins to mid-market rates, increasing conversion costs.

3. Multiple Conversions:Payments passing through several banks may undergo repeated currency conversions.

Transparency Issues with Forex Pricing and Potential Hidden Fees

Banks do not always disclose the true cost of foreign exchange and intermediary charges.

1. Undisclosed Markups:Forex rates include hidden margins above mid-market prices.

2. Unclear Fee Structures:Some banks provide limited details about intermediary fees.

3. Lack of Upfront Costs:Total charges are sometimes only visible after transaction completion.

Businesses and individuals should compare banking fees and seek transparent exchange rate structures to avoid unnecessary costs. As discussed further, delays can further increase transaction costs.

Addressing Delays and Fees in SWIFT Transfers

Delays in SWIFT transactions can result in additional costs, missed deadlines, and financial inconvenience. Understanding the impact of delays and strategies for timely payments is essential.

Impact of Delays on Transfer Costs

Delays in processing SWIFT transactions can result in financial losses.

1. Late Payment Fees:Businesses may incur penalties for late supplier payments.

2. Exchange Rate Changes: Delayed transfers may lead to currency fluctuations affecting final amounts.

3. Additional Tracing Costs: Extended delays may require paid tracking requests.

Strategies for Ensuring Timely Payments and Managing Late Fees

To minimize delays and additional costs, follow these best practices.

1. Double-check Bank Details:Ensure accurate recipient information to prevent errors.

2. Choose Faster Processing Options:Some banks offer priority SWIFT transfers.

3. Monitor Transaction Status:Regular follow-ups help track progress and avoid delays.

By taking these precautions, businesses and individuals can ensure smoother transactions. Alternative payment solutions may provide a better option for those looking to avoid high fees and delays.

Also Read: International Payments: The Challenges and Solutions of Cross border Payments.

Advantages of Alternative Payment Solutions

While SWIFT is a trusted method for international payments, alternative solutions offer cost-effectiveness and efficiency.

Comparison of SWIFT with Alternative Solutions

Modern payment methods offer greater transparency and lower costs.

1. Fintech Solutions: Providers like Payglocal enable seamless global transactions.

2. Blockchain-Based Payments: Cryptocurrencies and stablecoins offer borderless transactions.

3. Multi-Currency Accounts: Businesses can hold multiple currencies to avoid conversion fees.

Potential Cost Savings and Efficiency with Alternatives

Switching to alternative payment methods can help businesses optimize expenses.

1. Lower Fees: Fintech platforms offer competitive rates with no hidden costs.

2. Faster Transactions: Some services process payments within minutes.

3. Improved Transparency: Real-time exchange rates reduce forex uncertainties.

Businesses looking to optimize their payment strategies should explore these options.

Emerging Trends in SWIFT Transfer Charges (2025–2030)

Several key developments are reshaping SWIFT transfers as the global financial landscape evolves. These changes aim to enhance transparency, reduce costs, and integrate emerging technologies into traditional banking systems.

1.ISO 20022 Migration: A New Standard for Financial Messaging

By November 2025, the financial industry will complete its transition to ISO 20022, a universal messaging standard for payments. This shift promises richer data, improved interoperability, and streamlined processes across institutions and jurisdictions. Notably, by 2026, an estimated 87% of all global high-value payments will utilize ISO 20022, marking a significant move towards standardized and efficient cross-border transactions.

2.Integration of Digital Assets and Blockchain Technology

Starting in 2025, SWIFT will enable live transactions of digital currencies and tokenized assets across its network. This initiative aims to bridge the gap between traditional banking systems and emerging blockchain technologies, facilitating seamless transactions involving Central Bank Digital Currencies (CBDCs) and other digital assets. The move is expected to support the growing tokenized asset market, which is projected to reach $16 trillion by 2030.

3.Projected Surge in Cross-Border Payment Revenues

The global cross-border payments market is poised for substantial growth, with revenues expected to reach $260 billion by 2030. This surge is primarily driven by the B2B segment, which is anticipated to contribute $220.5 billion. The rise of embedded finance, integrating financial services into non-financial platforms, is a significant factor in this growth, simplifying international transactions and expanding access to financial tools.

Also Read: Understanding the Use and Elements of MT103 in SWIFT Payment Transfers

These developments signify a transformative period for international payments, with SWIFT at the forefront of integrating technological advancements to enhance efficiency, security, and user experience in cross-border transactions.

A Better Alternative To SWIFT Transactions: Why PayGlocal is a Better Choice Than SWIFT Transfers

PayGlocal removes the extra costs often associated with SWIFT transfers. Businesses pay only when transacting, with no setup fees, platform fees, or documentation charges. This simple pricing structure makes it easy to predict and manage expenses.

Key Features Of PayGlocal:

1. Multi-Currency Accounts: Collect payments in USD, GBP, EUR, CAD, and more, with no hidden costs.

2. Transparent Pricing:PayGlocal charges no setup, platform, or documentation fees—businesses pay only when transacting.

3. Payment Tracking: Real-time notifications keep businesses updated on payment status.

4. Low Transaction Costs: Reduce FX charges and eliminate intermediary fees with localized payment methods.

Unlike traditional SWIFT transfers, which involve multiple intermediaries and unpredictable costs, PayGlocal provides a more transparent and cost-effective solution. With lower fees, real-time tracking, and a simplified payment process, businesses can optimize international transactions without unnecessary financial burdens.

PayGlocal removes the extra costs often associated with SWIFT transfers. Businesses pay only when transacting, with no setup fees, platform fees, or documentation charges. This simple pricing structure makes it easy to predict and manage expenses.

Conclusion

Managing SWIFT transfer fees effectively requires understanding the different charges, selecting the proper fee-bearing method, and staying informed about cost factors. Strategies to minimize fees include comparing bank charges, negotiating forex rates, and considering alternative payment solutions for cost-effective transactions.

Traditional SWIFT transfers often have hidden fees, unpredictable costs, and lengthy processing times. Businesses looking for a more transparent and cost-efficient solution can benefit from PayGlocal's seamless international payment platform. Whether you must collect payments in multiple currencies, track transactions in real-time, or avoid intermediary bank fees, the platform offers a smarter alternative to traditional SWIFT transfers.

Ready to streamline your international payments? Get started with PayGlocal today and experience a faster, more cost-effective way to transact globally.

FAQs

1. Why does my recipient receive less money than I sent through a SWIFT transfer?

Even if you cover the transfer fee from your bank, intermediary (correspondent) banks along the route may deduct their fees, often without upfront disclosure. These hidden deductions can range from $15 to $50 or more per bank, depending on the route your money takes. Your recipient could receive significantly less than expected, especially if multiple banks are involved.

2. Can I choose who pays the SWIFT fees — me or the recipient?

Yes. When initiating a SWIFT transfer, you'll usually choose from three fee instruction types:

1. OUR: You (the sender) cover all fees.

2. SHA: You and the recipient share the fees.

3. BEN: The recipient pays all fees.

Choosing OUR ensures the recipient gets the full amount, but it may cost you more upfront. Most users unknowingly choose SHA by default, leading to confusion when the final received amount is lower.

3. Why do SWIFT transfer fees vary significantly between banks and services?

Because SWIFT is not a centralized payment system, it's a messaging protocol. Each bank or financial institution involved in the process sets its fees for processing and currency conversion. Every middleman can charge a fee if your money has to hop through several banks due to a lack of direct relationships. This is why some transfers cost $10, while others exceed $50, even for the same destination.

4. How do I avoid entirely unexpected SWIFT transfer deductions?

While you can't eliminate all deductions in traditional SWIFT routes, you can minimize or bypass them by:

1. Using OUR fee structure and confirming all parties honor it.

2. Choosing alternative services that use local payout networks, not traditional SWIFT rails. These often skip intermediary banks entirely, offering lower, transparent fees and mid-market exchange rates.

5. How much will the recipient receive?

Not with traditional banks. Most cannot guarantee the final amount due to variable correspondent bank deductions. However, PayGlocal offers upfront breakdowns of fees and exchange rates. These platforms often guarantee the recipient will get the amount shown at checkout, making them more transparent than most SWIFT-based bank transfers.

DISCLAIMER: The information provided in this blog post is intended for general informational purposes only and should not be construed as any advice or recommendation in any manner and is not reflective of any sponsorship of affiliation. While we strive to ensure the accuracy and reliability of the content, it may not reflect the latest developments or interpretations. Users are advised to exercise their own discretion and judgment before making any decisions or taking any actions based on the information provided.