To pay an IBAN, you send an international wire from your U.S. bank using the recipient’s IBAN in place of a domestic account number, along with their bank’s BIC/SWIFT code and legal name. The process runs through your online banking portal in about ten minutes once you have the details, costs roughly $30 to $50 in flat fees plus an exchange rate markup, and lands in the recipient’s account in one to four business days for a standard SWIFT wire, or by the next business day for a euro transfer within the SEPA area.
U.S. banks don’t issue IBANs themselves, so this only matters when you’re sending money out. Anyone sending money to your U.S. account uses your routing and account numbers instead.
What You Need From the Recipient Before You Start
Get every piece of this information in writing from the recipient or their bank. A single wrong character can stall the transfer or trigger an investigation fee in the $25 to $50 range on top of days of delay.
- The full IBAN, up to 34 characters. Copy and paste it rather than retyping. The check digits built into the IBAN will catch a typo before the transfer sends, but only if you get close enough for the format to validate.1SWIFT. IBAN Registry
- The recipient’s full legal name exactly as their bank has it on file. A name mismatch can hold or return the payment while banks investigate.2FFIEC BSA/AML. Assessing Compliance with BSA Regulatory Requirements – Customer Identification Program
- The BIC/SWIFT code of the recipient’s bank. This is 8 characters for the institution or 11 for a specific branch.3SWIFT. BIC Policy
- The recipient’s address, which many receiving banks require for compliance checks.
- A purpose-of-payment code if you’re sending to countries that require one, including India, China, and the United Arab Emirates. Your bank’s wire form will prompt you.
- The currency and amount, and whether you want the recipient to receive a specific figure in their local currency or you want to send a specific dollar amount.
Steps in Your Bank’s Portal
Log in and go to the international or wire transfers section. Pick “international wire” for most destinations, or “SEPA transfer” for a euro payment within the European Economic Area, which is slightly faster and cheaper.
Paste the IBAN into the account field. If the form has separate fields for parts of the IBAN, paste the whole string and let the system split it. Add the BIC/SWIFT code, the recipient’s name and address, the amount, and any purpose-of-payment code the destination requires.
Before you confirm, the portal will show a summary. Federal rules require your bank to display the transfer amount, all fees and taxes, the exchange rate, and the total the recipient will receive, all before you authorize.4eCFR. 12 CFR Part 1005 Subpart B – Requirements for Remittance Transfers Read this screen carefully. The exchange rate is where the biggest hidden cost usually sits.
Confirm with the multi-factor code your bank sends to your phone or generates on a token. Your bank then builds the SWIFT payment message and routes it into the clearing network. Save the confirmation page.
Who Pays the Fees: OUR, SHA, or BEN
Most wire forms ask you to pick a fee-sharing option. This choice determines whether the recipient receives the full amount you sent.
- OUR: You pay all fees, including intermediary and receiving bank charges. The recipient gets the full amount.
- SHA: You pay your bank’s outgoing fee. Any intermediary or receiving fees come out of the recipient’s end.
- BEN: All fees are deducted from the transfer before delivery. The recipient gets whatever is left.
If you’re paying an invoice or need the recipient to receive an exact figure, choose OUR. For SEPA transfers, SHA is the default and usually the only option.
What It Actually Costs
Three layers of cost stack up on an international wire, and the flat fee your bank quotes is only the first.
- Your bank’s outgoing wire fee, typically $30 to $50 for an online transfer. Branch-initiated wires and foreign-currency wires can cost more.
- Intermediary bank fees when the sending and receiving banks don’t have a direct relationship. Each correspondent bank in the chain may take $15 to $30. Under SHA, these come out of the recipient’s end.
- An exchange rate markup above the mid-market rate. On a larger transfer this margin often dwarfs the flat fee. Compare the rate on the summary screen against the current mid-market rate before you confirm, and cancel if it looks off.
How Long It Takes
A SEPA credit transfer within the European Economic Area settles by the end of the next business day under EU rules. SEPA Instant, where available, arrives in seconds.
A standard SWIFT wire usually takes one to four business days. The exact timing depends on how many intermediary banks touch the payment, the destination country, and whether compliance screening triggers extra review. Countries with strict capital controls or mandatory purpose-of-payment verification run longer. Sending on a Friday afternoon or before a holiday in the receiving country pushes the arrival date out.
Cancelling or Fixing a Mistake
Federal law gives you a 30-minute cancellation window after you authorize the transfer, as long as the funds haven’t already been picked up or credited to the recipient. Call your bank or write to it with your name and enough detail to identify the specific transfer. The bank must refund the full amount, fees included, within three business days of receiving your request.5eCFR. 12 CFR 1005.34 – Procedures for Cancellation and Refund of Remittance Transfers
If you spot an error after that window closes, you have 180 days from the date the funds were supposed to be available to report it. Covered errors include being charged the wrong amount, the recipient receiving less than disclosed, or the funds not arriving by the promised date. Your bank must investigate and either fix the error or explain why it thinks none occurred.6eCFR. 12 CFR 1005.33 – Procedures for Resolving Errors
These protections apply to banks and money transfer providers that handle more than 500 remittance transfers per year. Most major banks and established transfer services clear that threshold. A very small community bank or credit union that rarely processes international wires may not.7Consumer Financial Protection Bureau. 12 CFR 1005.30 – Remittance Transfer Definitions
Tracking the Payment
After you confirm, your portal shows a reference number. SWIFT-routed payments also carry a Unique End-to-End Transaction Reference (UETR), a 36-character string that works like a package tracking number. Every bank that handles the payment updates its status, and your bank gets notified when the funds are credited or rejected.8Swift. What Is a Unique End-to-end Transaction Reference (UETR)
Check the status in your bank’s transaction history. It will move from “Pending” to “Completed” once the funds leave your account and enter clearing. If the recipient reports a delay, share your reference number or UETR so their bank can trace the payment from the other side.
A Note on Tax Reporting
Paying an IBAN doesn’t create a tax obligation on its own. Holding a foreign account can. If the combined value of all your foreign financial accounts tops $10,000 at any point during the year, you must file a Report of Foreign Bank and Financial Accounts (FBAR) with FinCEN by April 15 of the following year, with an automatic extension to October 15.9Internal Revenue Service. Report of Foreign Bank and Financial Accounts (FBAR) Depending on the balance, IRS Form 8938 may apply separately.10Internal Revenue Service. Do I Need to File Form 8938, Statement of Specified Foreign Financial Assets If you’re only sending money to someone else’s overseas account, neither applies to you.