3 Mistakes to Avoid When Transferring Funds Between Your Accounts

Understanding the Risks of Transferring Funds

Transferring money between your accounts carries potential risks, and there are several errors one should avoid to prevent theft, scams, and loss of funds.
Over the years, money has increasingly become virtual.
We commonly pay with credit and debit cards, check our balances through online banking, and make transfers and payments directly from our smartphones.

Although cash is rarely used today, the risk of losing money remains significant.
This makes it crucial to be cautious when transferring funds from one account to another.

Methods for Transferring Money

There are various ways to transfer money between accounts.
You can withdraw cash from one account and deposit it into another, request a cashier’s check from your bank to deposit at a different financial institution, or use a direct bank transfer, known as a giroconto.

In all three scenarios, the person transferring money is not subject to cash usage limits, which only apply to transactions involving third parties.
However, the most common method today is direct transfer via giroconto.

What is Giroconto and How It Differs from a Bank Transfer

Firstly, it’s essential to understand the difference between a regular bank transfer and a giroconto.
A bank transfer allows the movement of funds from an account belonging to one person to another individual’s account, making it ideal for sending money to others.

Conversely, giroconto allows the transfer from one account to another (or from an account to a savings book), provided both accounts are under the same person’s name.
If the receiving account is also co-owned, a giroconto can still be used.
This method typically has faster processing times and lower costs, although this can vary by financial institution.

Avoiding Common Mistakes During Transfers

When utilizing electronic transfer systems to move funds, it’s vital to take specific precautions to safeguard your savings from malicious actors.

The first mistake to avoid is neglecting to check if the site being used (even if it belongs to your bank) is protected by an https protocol.
Sites that utilize http do not guarantee secure data transmission and could expose your sensitive information to theft.
A secure site will display a padlock icon in the browser address bar, indicating https is in use.

The second mistake is underestimating the importance of “End-to-End” encryption.
When using an app from your financial institution, always verify that it employs this encryption method, which ensures that only the sender and receiver can read the transmitted financial information.
With End-to-End encryption in place, even if a malicious actor infiltrates the network, they cannot access any sensitive data.

Lastly, pay close attention to the recipient’s IBAN before confirming the transfer.
Failing to do so can result in sending money to the wrong account.
Additionally, it’s wise to continuously monitor transaction records to ensure that the intended transfer is present and to quickly block any unauthorized transactions.
Many banks also allow customers to receive notifications via app or SMS for every transaction, keeping them informed about any payments or transfers made from their accounts.

For further information on sending money and ensuring secure transactions, check out Your Bank’s Secure Transfers.