How do transfers work

The world of online transfers at a glance

When it comes to online banking, one of the most popular features is definitely that of online transfers. Since nobody is tied to bank opening hours with this type of money transfer, you can go to anyone Cashless payments day and night make. Whether you are shopping online, paying unpaid bills or for other reasons for which you have to transfer money online - here you can find out what to look out for when making online transfers and what you should know about them.

What is an online transfer and how does it work?

Before we deal with the details of the online transfer, it should first be clarified what exactly a transfer is in itself. In principle, a transfer is a payment method. Instead of cash and with immediate effect, a transfer works completely without exchanging cash.

Instead, a form provided by the bank is filled out for a paper transfer. This includes your account details, the amount and the intended use the transfer, that is, the reason why you are paying money to the recipient's account. In addition, the recipient's bank details must of course be given.

In principle, the account number or IBAN and possibly the BIC or bank code of the recipient must be on a transfer order. IBAN stands for "international bank account number“And consists of a total of 22 positions. It is made up of the following digits: country code, check digit, bank code and account number.

Within the EU you only need the IBAN of the payee for transfers, for transfers to other countries outside the EU you need the BIC of the recipient. BIC stands for "Business Identifier Code“And can be understood as an international bank code. You will find out later what this is all about and what it has to do with SEPA transfers.

So when you make a transfer, money is being transferred from your account to someone else's account. By the way, you don't have to worry if the recipient of the transfer is not a member of the same financial institution as you - the transfer will still work.
Until a few years ago you basically had Paper transfers made and then handed it over to the bank. However, since online banking has successfully established itself, all of this is no longer necessary. In both cases, however, the transfer must be officially confirmed again by you, i.e. the client. If you make a paper transfer, this happens with your signature; for online banking you then need a TAN.

If all information has been entered correctly and the order has been successfully confirmed, the following basically happens: your bank or savings bank forwards the amount you specified to the payee's bank and credits it to the recipient's account. But as with the post office, for example, it's not just you who send a transfer, thousands of people do it every day. So that the banks don't lose track of things all transfer orders Collected every day up to a certain point in time and then sent together. Instead of the 50 euros that you have commissioned to a certain recipient bank, for example, 1500 euros are added and your bank ultimately sends 1550 euros to the corresponding bank on that day.

Most of these group shipments happen in the evening, but it depends on the bank. If you Another transfer in the middle of the night this is usually processed and sent on the evening of the following day. Thanks to its speed, this payment method is the most attractive method for most consumers to transfer money from one account to another.

What is the difference between a standing order and a transfer?

A standing order involves transfers that regularly in the same amount go to the same recipient at the same time. Often a standing order is set up for the punctual payment of the rent, for installment payments or insurance contributions. You can of course change the details of your standing order with your bank at any time. A transfer, on the other hand, is a one-time payment to a single recipient.

What is a SEPA transfer?

SEPA stands for “Single Euro Payments Area”, translated into German: “Uniform Euro Payments Area”. The introduction of the euro also meant that the regulation of the cashless payment area be taken care of in Europe. Therefore the SEPA framework was introduced. The aim was not to make a noticeable distinction between national and international payments and thus to make it easier for consumers and companies in the European economic area to make transfers and financial transactions. SEPA has been the EU-wide standard for cashless payments since 2014.

As with traditional transfers, the account details of the sender and recipient must be given for SEPA transfers. For SEPA transfers, these consist of the IBAN and BIC. The IBAN is a newer version of the account number and the BIC is the sort code. So the principle is actually the same as with the classic transfer.

SEPA transfers have made it much easier and clearer to Payments within the EU to do. The fact that the system has been standardized means that there is less confusion, especially with international transfers, which are now commonplace due to options such as online shopping but also the close economic relationships between individual EU countries.

How long does an online transfer take?

There is a legal obligation to which banks must adhere to the duration of online transfers: Payments from one account to another may not last longer than a banking day last. It can still happen that a transfer takes more time. For example, the bank does not process transfers on public holidays and weekends.

If a paper transfer has been submitted to the bank, this can take longer than in electronic form, namely by one day. Even if a transfer is made outside the transfer deadline, this can only be done processed the following day and be forwarded.

However, there is now a transfer method that can be used to transfer money faster than ever before. It is a real-time transfer.

What is a real-time transfer?

In July 2018, a new, faster type of online transfer was introduced. Thanks to this method, the client's money is paid into the account of the recipient of the order within a few seconds. Incidentally, this works at any time of the day or night and also on weekends and public holidays. This option can be particularly useful if you have forgotten to pay a pending invoice and receive a reminder calling for immediate payment.

Because a real-time transfer usually takes no longer than 20 seconds. Compared to classic online transfers, which ultimately take up at least one banking day, that can make a big difference. It is also important to know that the Real-time transfer is only possible in certain SEPA countries. You can currently make such a real-time transfer in 15 of the 34 SEPA countries.

Can an online transfer be retrieved?

It can happen that you make a mistake with a transfer and provide incorrect information. In such a case, you have to act quickly because once the money has reached the account of the specified recipient, it is not easy to get the Undo transfer close.

You should contact your bank or savings bank immediately and try to have the order canceled. Sometimes you can even get in touch with the recipient bank. The amount that has been debited from your account can only be debited back if it has not yet been credited to the recipient bank. If that happened, you can still try to get your money from your bank.

Online transfers at Penta

Penta is a current account with a German IBAN that offers you all the classic banking services, such as transfers, card payments and more. At Penta everything completely online and paperless.

In general, we regulate all transfers based on the guidelines of the SEPA framework. This means that a normal transfer from and to SEPA accounts must also be booked within one banking day.

At Penta you also have the option of making collective transfers. If, for example, you have collected several payments over a certain period of time and then want to send them off with one shot without great effort, you can use the collective transfer function to create several SEPA transfers by uploading a single file and authorize them with a single TAN. You can easily create such a file, or more precisely: a CSV file, with programs such as Excel.

Be at Penta Transfers through SMS TANs secured. So when you place an order, you have to confirm it with a code. We will send you this code via SMS. So please make sure to enter your current mobile phone number during registration so that there are no problems with your transfers.

With Penta, you also have the option of sending transfers later or on a date of your choosing. You can then decide whether the payment should be made once, monthly, quarterly, semi-annually or once a year.

>> Learn more about thatPenta online business account