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BANGKOK 21 July 2019 13:20
Thomas J

Chase $5 Wire Transfer - Is this an IAT transfer?

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I am a customer of Chase in the USA and got the attached notice on them reducing their wire transfer fee.  I am using the monthly income method for my Retirement Visa.  I understand that transfers must be in an IAT format.  Does anyone know if those transfers show up as IAT, or how those transfers would show as IAT on my statements? 

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Chase $40 wire transfer was a Swift transfer in the past, not ACH or IAT. Seems they reduced the price Chase charges. 

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10 minutes ago, asiaexpat said:

Chase $40 wire transfer was a Swift transfer in the past, not ACH or IAT. Seems they reduced the price Chase charges. 

I thought that all SWIFT transfers internationally were IAT.  I know it is not an ACH since that is an Automated Clearing House transaction and those all only between banks in the USA. 

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IAT stands for "International ACH Transaction " which is transmitted using the ACH system. It's an ACH transfer formatted to comply with ACH transfers leaving or entering the US. You also have an ACH "domestic" formatted transfer which is for a transfer that stays within the US. An ACH IAT formatted transfer requires additional info compared to an ACH domestic formatted transfer.

An ACH IAT formatted transfer basically requires the same info as an International Wire...but don't confuse an ACH IAT transfer with an International Wire as they use two different transfer systems....night and day different.

An International Wire does not use the ACH system; it uses the SWIFT system. Two completely different animals.

As already mentioned the Chase ad says a $5 sending fee if sending a foriegn currency which means Chase will do the exchange on their end at an exchange rate less than the exchange rate given by Thai banks. This means Chase will be basically hitting you with a healthy indirect (hidden) fee they are disguising in their ad.

It's a common practice for many banks to offer a much lower direct sending fee if you allow them to accomplish the currency exchange. If you don't allow them then a higher direct sending fee applies which will usually be the best deal for you...less total direct and indirect fees...put the most baht in your Thai bank account at the least cost to you.



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6 hours ago, Pib said:

As already mentioned the Chase ad says a $5 sending fee if sending a foriegn currency which means Chase will do the exchange on their end at an exchange rate less than the exchange rate given by Thai banks. This means Chase will be basically hitting you with a healthy indirect (hidden) fee they are disguising in their ad.

Yes I knew the exchange rate would not be as good however it is only my monthly social security so the lower sending fee "i think" will be more than enough to compensate.  I know you can determine the rate before.  Do you happen to know if the wire transfer will satisfy the immigration in Thailand.  I understand the ACH does not for whatever reason. 

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20 minutes ago, Thomas J said:

Yes I knew the exchange rate would not be as good however it is only my monthly social security so the lower sending fee "i think" will be more than enough to compensate.  I know you can determine the rate before.  Do you happen to know if the wire transfer will satisfy the immigration in Thailand.  I understand the ACH does not for whatever reason. 

I think you will probably be sadly disappointed with whatever the Chase exchange rate is for baht....it will surely be several percent below the Thai bank rate...and the lower sending fee will "not" fully compensate sending dollars instead.  Chase is basically dangling a tasty worm on a sharp hook.

 

Let's say the Chase exchange rate is 2% lower (and it could easily be closer to 3% lower) and your social security payment is $1500. 

 

2% of $1500 is $30....add the $5 direct sending fee and you have $35 in Chase direct plus indirect fees....plus you will still have the Thai bank receiving fee of 0.25% (Bt200 min, Bt500 max) which would work out to Bt200/approx $6.50.  But that Thai bank receiving fee applies to any international transfer arriving via SWIFT or ACH and in any currency.  Total fees now up to $41.50 assuming no intermediary bank fees.

 

3% of Bt1500 is $45....add the $5 direct sending fee and you have $50 in Chase direct/indirect fees....plus 

you will still have the Thai bank receiving fee of 0.25% (Bt200 min, Bt500 max) which would work out to Bt200/approx $6.50.  Total fees now up to $56.50 assuming no intermediary bank fees.

 

Sure, a SWIFT transfer should be coded as an international transfer which definitely makes immigration happy.  I say "should" be coded international because there is a "small" chance it may not if the routing of the SWIFT uses a intermediary Bahtnet SWIFT code/bank...then the transfer will be coded as a BTN/Bahtnet vs an international transfer.   Then you may need to provide additional paperwork to prove the transfer was indeed an international transfer.

 

Summary: over the years I can't recall any situation where allowing the western Sending bank to convert to baht on their end worked out better for the customer than "not" letting them convert on their end and sending your home country currency (USD in your case).  Western sending banks "love it" when you allow them to accomplish the currency exchange as they make a larger profit at the customer's expense due to their crappy exchange rate.  Always fully price-out a transfer in both fees "and" exchange rate....not just fees nor just exchange rate.  Biting the tasty looking $5 transfer fee worm may cause you to get filleted.

 

 

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6 minutes ago, Pib said:

I think you will probably be sadly disappointed with whatever the Chase exchange rate is for baht....it will surely be several percent below the Thai bank rate...and the lower sending fee will "not" fully compensate sending dollars instead.  Chase is basically dangling a tasty worm on a sharp hook.

You may be correct, I have never used Chase allowing them to set the exchange rate.  However Transferwise Fees are now upwards of $20 USA and you get nicked with their exchange fee too.  Though the exchange rate is better, I would have to do a calculation to see which is better.  

Are you a former banker?  I am too but on the Trust side so my familiarity with the ACH/IAT system is more limited. 
Do you happen to know if you do a direct deposit from social security if it qualifies for the monthly minimum when it is coded into a Thai bank? 

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6 minutes ago, Thomas J said:

You may be correct, I have never used Chase allowing them to set the exchange rate.  However Transferwise Fees are now upwards of $20 USA and you get nicked with their exchange fee too.  Though the exchange rate is better, I would have to do a calculation to see which is better.  

Are you a former banker?  I am too but on the Trust side so my familiarity with the ACH/IAT system is more limited. 
Do you happen to know if you do a direct deposit from social security if it qualifies for the monthly minimum when it is coded into a Thai bank? 

 

Transferwise fees would be $16.20 on a $1500 transfer.  You do not get nicked on the exchange rate with Transferwise as they use the mid-market rate....the same rate that the big boy currency traders/banks get.

 

Nope...not a former bank...have just made it a point over the years to best understand my personal finances/investments.

 

Having your SS directed deposited via "ACH system direct deposit" to Bangkok Bank (your only Thai bank choice if using ACH Direct deposit) will be coded as an international transfer.   Assuming your are talking a retirement extension of stay then the monthly requirement is Bt65K deposit which means SS needs to be paying you around $2100/month before any tax/medicare deductions.   And to ensure that ACH Direct Direct deposit from SS is transmitted as an ACH "IAT" format you must have a foreign/Thailand address onfile with SSA; otherwise, SS transmit your payment as a ACH "domestic" format which would be rejected by Bangkok Bank beginning 1 Jan 2020 since it not in the ACH "IAT" format.

 

Now, just over the last few months "International Direct Deposit (IDD)" for Thailand has went operational....SS Direct Deposit via IDD uses the SWIFT system vs the ACH system.  Unfortunately, IDD via SWIFT uses an intermediary bank "Bahtnet" SWIFT routing code which does not give the normal international transfer coding on your receiving Thai bank account.  Instead you get "BTN/Bahtnet" coding which appears like a local domestic transfer.  However, if your go get a Credit Advice from the Thai bank it will show the transfer was indeed an international transfer....it's just will not show on your passbook/ibanking as an international transfer.  Hopefully, that Thai bank Credit Advice would satisfy your immigration office the transfer was indeed an international transfer.

 

 

image.png.51b20f92ae83d51eb7869040c21cc785.png

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17 minutes ago, Pib said:

Now, just over the last few months "International Direct Deposit (IDD)" for Thailand has went operational....SS Direct Deposit via IDD uses the SWIFT system vs the ACH system. 

Is the attached image what you are referencing when you are talking about the international direct deposit system?  The whole system is about as clear as mud and why it would matter to Thai immigaration that a person shows they have income coded as IAT vs ACH is beyond my comprehension.  So just to be clear, if I was to convert my social security deposit to a Thai bank there is a chance that it would not be properly coded in my passbook?  

Thai Bank.JPG

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4 hours ago, Thomas J said:

  So just to be clear, if I was to convert my social security deposit to a Thai bank there is a chance that it would not be properly coded in my passbook?  

Your post included an image talking the SS International Direct Deposit (IDD) program which went operational over the last few months.  I have a family member using SS IDD....first IDD payment occurred 3 July 2019.  The IDD coding that will appear on your Thai bank statement/passbook (whoever your Thai bank is) will be a "Bahtnet" code which generally means it was a local/domestic transfer...it's just the routing the IDD program uses that causes that Bahtnet coding. If you had a Bangkok Bank acct it would appear as "BTN" in your passbook and Bahtnet in your ibanking Description.  But if you go get a Credit Advice from your Thai bank it will show it was an international transfer.

 

Now for the muddy water time.  Based on various ThaiVisa posts were people are beginning to report their experiences at their immigration office "when attempting to use the monthly deposit/transfer method (i.e., Bt65K/month being sent to Thailand)."  Some posts have said their office wanted a letter from their Thai bank that individually listed each international transfer on the letter.  Then when going to their bank to get that letter some Thai banks have said they can provide the letter but they will only list transfers on the letter that received the international coding used by that bank" and Bahtnet coding does not necessarily meet that requirement.

 

For example Bangkok Bank international coding is "FTT" which stands for Foreign Telegraphic Transfer.  Other Thai bank have their own unique coding to represent an international transfer.   Since Bahtnet gives a BTN coding Bankgok Bank will not list it on their letter even through if your get a Credit Advice from Bangkok Bank for that transfer it clearly shows it came form overseas....specifically shows the SS IDD payment came from the Federal Reserve Bank of New York.   Now if you can't get your Bangkok Bank branch (or whoever your bank is...SCB, K-bank, Krungsri, TMB, etc) to include that transfer on their letter then you will  have to rely on/hope your immigration office will be happy with the Credit Advice or some other document you provide showing the transfer came from overseas.  As always, different results being reported by ThaiVisa posters since posters use different immigration offices...the only consistent thing with immigration offices is the inconsistency between offices.

 

Now if your do not want to use the SS IDD program, you can use the SS ACH program to a Bangkok Bank special Direct Deposit account...those SS ACH transfers will be reflected as FTT/International Transfer.  Bangkok Bank is only Thai bank with ACH receiving capability.   But this special Direct Deposit account comes with restrictions like no debit card allowed, no ibanking transfers from that account, the account only in your name, and you can only withdraw/transfer funds from that Direct Deposit account by "you" with passport in hand visiting any Bangkok Bank branch to prove your are still alive each and every time your want to withdraw/transfer funds for that Direct Deposit account.

 

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1 hour ago, Pib said:

Your post included an image talking the SS International Direct Deposit (IDD) program which went operational over the last few months.  I have a family member using SS IDD....first IDD payment occurred 3 July 2019.  The IDD coding that will appear on your Thai bank statement/passbook (whoever your Thai bank is) will be a "Bahtnet" code which generally means it was a local/domestic transfer...it's just the routing the IDD program uses that causes that Bahtnet coding. If you had a Bangkok Bank acct it would appear as "BTN" in your passbook and Bahtnet in your ibanking Description.  But if you go get a Credit Advice from your Thai bank it will show it was an international transfer.

 

Now for the muddy water time.  Based on various ThaiVisa posts were people are beginning to report their experiences at their immigration office "when attempting to use the monthly deposit/transfer method (i.e., Bt65K/month being sent to Thailand)."  Some posts have said their office wanted a letter from their Thai bank that individually listed each international transfer on the letter.  Then when going to their bank to get that letter some Thai banks have said they can provide the letter but they will only list transfers on the letter that received the international coding used by that bank" and Bahtnet coding does not necessarily meet that requirement.

 

For example Bangkok Bank international coding is "FTT" which stands for Foreign Telegraphic Transfer.  Other Thai bank have their own unique coding to represent an international transfer.   Since Bahtnet gives a BTN coding Bankgok Bank will not list it on their letter even through if your get a Credit Advice from Bangkok Bank for that transfer it clearly shows it came form overseas....specifically shows the SS IDD payment came from the Federal Reserve Bank of New York.   Now if you can't get your Bangkok Bank branch (or whoever your bank is...SCB, K-bank, Krungsri, TMB, etc) to include that transfer on their letter then you will  have to rely on/hope your immigration office will be happy with the Credit Advice or some other document you provide showing the transfer came from overseas.  As always, different results being reported by ThaiVisa posters since posters use different immigration offices...the only consistent thing with immigration offices is the inconsistency between offices.

 

Now if your do not want to use the SS IDD program, you can use the SS ACH program to a Bangkok Bank special Direct Deposit account...those SS ACH transfers will be reflected as FTT/International Transfer.  Bangkok Bank is only Thai bank with ACH receiving capability.   But this special Direct Deposit account comes with restrictions like no debit card allowed, no ibanking transfers from that account, the account only in your name, and you can only withdraw/transfer funds from that Direct Deposit account by "you" with passport in hand visiting any Bangkok Bank branch to prove your are still alive each and every time your want to withdraw/transfer funds for that Direct Deposit account.

 

Thank you for your help.  You know far more than anyone else.  I do have Bangkok bank.  I just don't want to get into the situation where I conscientiously transfer the money for 12 months only to find out the "thai surprise" that no they don't accept that. 

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15 hours ago, Pib said:

As already mentioned the Chase ad says a $5 sending fee if sending a foriegn currency which means Chase will do the exchange on their end at an exchange rate less than the exchange rate given by Thai banks. This means Chase will be basically hitting you with a healthy indirect (hidden) fee they are disguising in their ad.

 

A nice bit of deceptive advertising on Chase's part.

 

They promote a big about their $5 wire transfer fee. But they don't explain that because they're requiring the sender to let Chase do the conversion to foreign currency at Chase's poor exchange rates (vs. what the sender would get having the money exchanged in the destination country), the sender is already paying Chase thru the nose via its poor exchange rate.

 

And as for the OP's core question, no this has nothing to do with IAT transfers. It's strictly about the traditional wire transfers.

 

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Pib, I may have asked this before but with all these alternatives its confusing. 

Does DFAS do the method you described in the following quote?

 

"Now if your do not want to use the SS IDD program, you can use the SS ACH program to a Bangkok Bank special Direct Deposit account...those SS ACH transfers will be reflected as FTT/International Transfer.  Bangkok Bank is only Thai bank with ACH receiving capability.   But this special Direct Deposit account comes with restrictions like no debit card allowed, no ibanking transfers from that account, the account only in your name, and you can only withdraw/transfer funds from that Direct Deposit account by "you" with passport in hand visiting any Bangkok Bank branch to prove your are still alive each and every time your want to withdraw/transfer funds for that Direct Deposit account."

 

Again, my question is will DFAS do as described above?

 

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Posted (edited)
7 hours ago, Thomas J said:

why it would matter to Thai immigaration that a person shows they have income coded as IAT vs ACH is beyond my comprehension. 

 

The IAT vs ACH issue is mainly relevant for people who are using the Bangkok Bank New York branch to send transfers from their U.S. bank to Bangkok Bank in Thailand via BKKB's New York branch. (No other Thai bank currently allows ACH transfers from the U.S. to Thailand.)

 

And that issue has pretty much nothing to do with Immigration or the way foreign transfers are coded. Because....any transfer being sent to Thailand from a private sender's U.S. bank account to their BKKB Thailand account via the New York branch is going to be coded by BKKB TH as a foreign transfer, period. So that's not really an issue for Immigration.

 

The issue, however, is right now as far as anyone knows, there is no U.S. financial entity that provides IAT transfers for its consumer customers. Only simpler ACH transfers. And those simpler ACH transfers are the type that BKKB NY says they're going to stop forwarding (now their latest cutoff date) starting Sept. 1 for consumer senders.

 

So after that, for the consumer sender, if BKKB follows thru on that ACH cutoff requiring IAT transfers that no U.S. consumer bank customer has the actual ability to send, it will be mean several things:

 

--consumer transfers from the U.S. via BKKB NY and onward to BKKB Thailand will no longer be allowed via the ACH method.

 

-- consumer DOMESTIC wire transfers from the U.S. via BKKB NY and onward to BKKB Thailand will still be allowed, and will be coded by BKKB TH as foreign transfers, thus satisfying Immigration.

 

-- consumers no longer able to send traditional ACH transfers via BKKB / BKKB NY may look elsewhere for alternative services such as Transferwise, and it's in those cases where the issue more likely will arise as to how the receiving Thai bank codes those incoming transfers -- Bahtnet domestic, or foreign.  If Bahtnet domestic, it has the potential to cause problems with Thai Immigration.

 

Edited by TallGuyJohninBKK

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