Do you have international clients and need to send money abroad and wondering what is TT payment? Telegraphic transfers (TTs) are an electronic means of transferring money that are primarily used for international wire transfers.
Find out everything you need to know about making a telegraphic transfer from Australia, including our guide to the TT payment procedure, right here!
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What is a T/T Payment?
T/T stands for “telegraphic transfer” in a payment.’ Or, a foreign wire transfer of money from the buyer’s bank to the seller’s bank.
When a Chinese vendor requests a T/T payment, they actually want a wire transfer. (The vast majority of people mistakenly believe that a T/T payment and a wire transfer made using the SWIFT system are the same thing, even though they aren’t exactly the same in terms of technicality.)
In international trade with Asian nations, a wire transfer based on SWIFT is the most popular payment option. Depending on your agreement with the commercial department in your bank, it typically takes 3-5 working days to clear and generally costs between $25 and $50 USD.
Read More: Shipping From China Term
How Telegraphic Transfer Works
Before reaching its destination, TT payments route your money through a number of different banks. Telegraphic transfers can be a bit more expensive and time-consuming than other money transfer services because each of these banks will have different fees and processing times.
The SWIFT network is the collective name for the bank-to-bank network that your money travels through. The banks are called “correspondent banks” because your money only passes between banks which have commercial relationships. In general, the processing time for telegraphic transfers is one to two days.
Special Considerations
The transfer must be completed with specific information about the sender and destination. The account numbers and information about the corresponding financial institutions are the most important pieces of information needed for any transfer, whether it is between accounts held in the same name or between accounts held by two different people.
For security reasons and to verify the sender’s identity, personally identifiable information is also necessary. Similar requirements apply to business entities, but the identifiable information pertains to the business rather than the individual.
Why Was It Called Telegraphic Transfer (TT)?
Money was first transferred between financial institutions over telegraph wires, which served as the equivalent of the internet in the 19th century.
The telegraphic transfer concept has evolved with changing technologies since the telegraph itself has become obsolete; currently, money is transferred via cable networks or cloud-based apps.
Why Telegraphic Transfer (TT) Was Important?
Money was transferred directly between banks and other financial institutions using Telex messages prior to the invention of Telegraphic Transfer. Before there were any electronic payment networks, TT payments were very well-liked. TT is regarded as one of the other electronic fund transfers since it operated using cable messages.
Despite the telegraph’s obsolescence, the idea of telegraphic transfers has continued to exist and is now used to transfer money over secure cable networks. Electronic fund transfers, or EFTs, are a method of money transfer used by banks and other financial institutions.
Key Characteristics of a Telegraphic Transfer
Telegraphic transfers offer a level of security in addition to a set of standards and guidelines to manage the way the transfers are carried out. Depending on the origin and destination of the transfer as well as any necessary currency exchanges, the TT typically takes two to four business days to complete. In exchange for the quick service, TTs are typically fairly expensive.
How to Send a Telegraphic Transfer
You must first make sure you have all the necessary documentation before sending a TT payment. You’ll need your personal information first (name and bank account information). The recipient’s information is also required, including their name, address, and contact details as well as the name of their bank and bank account number.
You may also need to include their IBAN number or Once you have the information for the telegraphic transfer together, send the money using the SWIFT code. The TT payment procedure may differ between different banks, but generally it will follow these steps:
- Discover the transfer location. Although you might need to visit a branch, telegraphic transfers can be made online if your bank supports them. You can look this up on their website or by contacting customer service.
- Obtain the necessary paperwork, visit a branch, and speak to a teller if you must complete the transfer there. They ought to be able to initiate the TT payment process.
- Logging into your online banking account and following the instructions should suffice if you know how to make a telegraphic transfer online. Look for the section marked “International Payment”, “Wire Transfer”, “Send Money Overseas”, or so on.
What is the Most Common Payment Term Requested by Chinese Suppliers?
The most common payment method is a bank wire that works this way:
- Until you are certain that the supplier has a firm understanding of your requirements, you have them develop sample(s).
- Prior to the beginning of production, you send a 30% deposit (by T/T payment).
- Your supplier (the manufacturer & exporter) purchases the components and/or materials and arranges the production
- To check the quality of your products, you collaborate with a quality assurance company (this is optional but generally a good idea).
- Prior to shipping, you transfer the final 70% (by T/T payment).
- The vendor uses express courier to send you the documents and ship the goods.
Conclusion on What is TT Payment
Till the 1990s, TT was a popular method of electronic money transfer. Telex transfers, also referred to as TTs, are another name for telegraphic transfers.
TT used to be the quickest method of transferring money. Depending on where the money is being sent from and where it is going, TT transfers money in 2-4 days.
Please leave your comments below if you have any additional queries about these payment methods.
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FAQs
Is TT Same as Bank Transfer?
When you hear the term “telegraphic transfers”, all you need to know is that it refers to international money transfers made from one account to another. It’s synonymous with terms like bank transfer, wire transfer, or SWIFT transfer, which are now more commonly used to describe the same process.
What is the Risk of TT Payment?
There is no secure method for making an international payment, and you should keep this in mind. It is possible to substitute another number, like the account number to which the transfer should be made. Because the payment is unrelated to the order, the importer loses money when making a transfer to such an account.
Is TT a Wire Transfer?
Nowadays, the term telegraphic transfer is used synonymously with a wire transfer. This can be attributed to the fact that the new electronic system has supplanted the outdated fund transfer system as a result of electronic and technological advancements. Despite the use of a new word, the fundamental meaning remains the same.
