Remittance Glossary — Key Terms Explained

SWIFT / BIC Code: A bank's international ID. An 8 or 11-character code (e.g., BKCHCNBJ for Bank of China). You need the recipient bank's SWIFT code for any international wire transfer.
IBAN: International Bank Account Number, standard in Europe. Includes country code, bank code, and account number. Required for transfers to European accounts.
Intermediary Bank: A bank that acts as a middleman routing your transfer. Money may pass through 1-3 intermediary banks, each potentially deducting US$15-30. Digital platforms like Wise bypass intermediaries.
FX Markup: The difference between the interbank (mid-market) rate and the rate you're offered. Banks typically add 0.5-2%. Platforms like Wise use the mid-market rate and charge a transparent fee instead.
MT103: The standard SWIFT message format for international wire transfers—like a tracking number for your money. Tracked via UETR (Unique End-to-End Transaction Reference).
OUR / SHA / BEN: Who pays the transfer fees. OUR = sender pays all (guaranteed full amount arrives). SHA = shared (sender pays outgoing, recipient pays incoming). BEN = recipient pays all.
Wire Transfer Fee: A fixed charge per transfer (typically US$15-50), unrelated to amount. Sending one large transfer costs less in fees than multiple small ones.
Exchange Control Limit (China): Chinese residents can purchase up to US$50,000 equivalent per year under simplified rules. Above this requires documentation (tuition invoice, admission letter, etc.)—not prohibited, just additional review.
Settlement / Conversion: Converting foreign currency to your local currency. When you receive an international transfer, the foreign currency sits in your account as "foreign exchange" until you manually convert it.
Payment Purpose / Reference: The mandatory description explaining why you're sending money. Common categories: tuition, family support, travel, medical. Choosing the wrong category may cause your transfer to be returned.