Topic: How does international money transfer works? (Read 550 times)
This doesn't seem off topic at all. The international transfer aspect of Bitcoin is a drum beat loud and proud. What knowledge of the global potential of Bitcoin is being discussed. I haven't found much here.
Found this question on google, nobody seems to know how to answer it:
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i am talking about wire transfer between two international banks (ie transferring money from one country to another).
as far as i am aware the process goes like this (simplified):
1- the sending bank needs to have an account with the receiving bank (or have an account with another bank that already has a bank with the receiving bank).
2- the sending bank debit the account of the applicant (client who wants to sends the money)
3- the receiving bank debit the account of the sending bank (held with the receiving bank) then credit the account of the recipient client (the person asking for the money)
all this is fine, everything so far is done electronically and recorded on the books.
my question is, if someone is sending $1000 from south africa to another person in finland, does the money eventually physically move from south africa to finland? and how? does the sending bank hire a plane or ship to do so? or is this part of the central bank's job?
it can not be all done electronically! at some point (end of fiscal year maybe?) money has to physically move around, hasn't it? i assume the banks must make settlements between each other .. but how? again .. is it through the central bank of the country? do central banks work together and exchange money on an international level?
i feel i am missing something here. any way thanks for your answer if you already know
--
i am talking about wire transfer between two international banks (ie transferring money from one country to another).
as far as i am aware the process goes like this (simplified):
1- the sending bank needs to have an account with the receiving bank (or have an account with another bank that already has a bank with the receiving bank).
2- the sending bank debit the account of the applicant (client who wants to sends the money)
3- the receiving bank debit the account of the sending bank (held with the receiving bank) then credit the account of the recipient client (the person asking for the money)
all this is fine, everything so far is done electronically and recorded on the books.
my question is, if someone is sending $1000 from south africa to another person in finland, does the money eventually physically move from south africa to finland? and how? does the sending bank hire a plane or ship to do so? or is this part of the central bank's job?
it can not be all done electronically! at some point (end of fiscal year maybe?) money has to physically move around, hasn't it? i assume the banks must make settlements between each other .. but how? again .. is it through the central bank of the country? do central banks work together and exchange money on an international level?
i feel i am missing something here. any way thanks for your answer if you already know
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