What is a Telegraphic Transfer?

A telegraphic transfer is an electronic method of money transfer. In the beginning the transfer was done using the telegraph which is a cable or a wire. However these days the telegraph is not used for the transfer. Still the practice of transferring money is known by the same name.

The telegraphic transfer is also known as a Telex Transfer or TT. It has been a means of communication between financial institutions for a long time. The telegraphic transfer can be used to transfer money from an account in a certain bank to an account in a different bank. The transfer can be done universally.

In a TT the money is not actually transferred. Only the payment order is wired. The money is then paid to the recipient. Typically a telegraphic transfer costs a nominal amount and the amount is paid by both the sender and the recipient.

The telegraphic transfer can also be used to transfer the entire money in an account and not just a part of it. This could be to a different bank or just to another branch of the same bank.

Consider a situation where a person living in one city is transferred to another city. The person could withdraw the money from his account and then personally take it and deposit it in a new account. This is not only risky but also inconvenient. Instead he could just open a new account in the city and then authorize the two banks involved to transfer all the funds into the new account. After this the old account would be closed.

The telegraphic transfer is a bit outdated for the modern living. This is due to the emergence of large number of national and international banks. As a matter of fact concerns’ regarding the safety is more due to the wider network. The idea of transferring money quickly and safely between two banks remains the same. It is still used by many merchants to make payments.

The basic rule of telegraphic transfer is still the same, only the technology used to perform the job has changed. Thus though the telegraphic transfer is used less these days, it still remains a convenient and safe way of transferring money!