You have probably experienced this yourself; you transfer money to another bank account in Belgium, but it takes days for it to arrive. But what happens to the cash between it leaving your account and it being paid onto the account of the individual, company or institution that you wish to pay. VRT News’ financial expert Michaël Van Droogenbroeck provides an explanation.
"It is basically quite simple. If you transfer money between accounts at the same bank, the transaction usually takes place immediately. If the money is being transferred to an account with another bank the money should be on the recipient's account the next working day. However, in practice, this is not always the case" Michaël Van Droogenbroeck explains.
The time at which the transfer is made is also important, as this has a big influence on how long the money will be on its way. "If you make a transfer after the banks are closed on a Friday it may take until Monday or Tuesday for the money to appear on the recipient's account. This is because banks do not process regular bank transfers during the weekend."
Where does the money go in the meantime?
While it is in limbo between two accounts the money has not actually disappeared. A third-party intermediary is temporarily taking care of it. They collect and check the money and try and prevent fraudulent transactions from being made.
“This is a human being that acts as an intermediary and this can cause delays and therefore it can take several days before the money arrives at the recipient’s account.”
Instant transfers
To avoid having to wait you can opt for an instant transfer. With an instant transfer there is no waiting time. Since the beginning of the year banks in Europe have been obliged to offer their customers this service completely free of charge.
Previously, banks sometimes charged extra for it. A draw back with an instant transfer is that a payment cannot be reversed.