What is an intermediary bank?

An intermediary bank is a third-party bank that does an international wire transfer when the sending bank and the receiving bank don't have a direct relationship with each other. You can call it a relay station, where your money stops, the fee is deducted, and then whatever is left continues towards the destination.

Depending on the route and the countries involved, there can be 1, 2, or even 3 of these banks between you and your recipient. Each one charges a fee, and each one takes time.

Beyond just moving money, intermediary banks also verify the transaction and run compliance checks along the way. They are an active stop in the journey, which is exactly why they charge for it.

On the other side, intermediary banks may not always be part of the picture. When your bank already has a direct relationship with the recipient's bank, the money moves straight across with no stops in between. That's why using a platform with strong global banking connections can genuinely save you money on every transfer.

Correspondent bank meaning: is it the same thing?

The terms “correspondent bank” and “intermediary bank” are often used interchangeably, and most of the time they do mean the same thing.

There is a small difference, a correspondent bank already has a relationship with one of the banks in the transaction, and it usually includes the sending bank. Meanwhile an intermediary bank necessarily does not have a pre-existing relationship with the bank.

A correspondent bank works with multiple currencies and the intermediary bank deals with only 1 currency.

For a founder wiring money internationally, the distinction rarely matters. What does matter is knowing that a bank you've never heard of, one that isn't working for you, in many cases will be somewhere in the chain, and will deduct a fee before passing your funds along.

How do intermediary banks work

Here's what actually happens when you hit send on an international wire:

• You instruct your bank to send funds abroad
  
• Your bank checks whether it has a direct relationship with the recipient's bank
  
• If no direct path exists, it routes the transfer through 1 or more banks that do
  
• Each bank in the chain receives the funds, deducts its fee, and forwards what's left
  
• The recipient's bank credits the account with whatever arrives
  

For example, let’s say you are a founder based in the US, paying a supplier in Indonesia. Your bank in New York doesn't have a direct relationship with your supplier's local bank in Jakarta, so it can't just send the money straight across. Instead, it routes the payment through a large international bank like Citibank, which does have that connection. Citibank receives the funds, takes its fee, and forwards the rest to the bank in Jakarta, which then credits your supplier's account. Your supplier gets paid, just a little less than what you sent.

The whole process runs through the SWIFT network, a global financial messaging system used by more than 11,000 institutions across 200+ countries. Every bank in the chain is identified by a unique code called a SWIFT number, also known as a BIC (Bank Identifier Code).

It's also worth knowing how a SWIFT number differs from a US routing number, since founders working across borders run into both. A routing number is a 9-digit code used only for domestic transfers within the US. A SWIFT number is an 8 to 11 character alphanumeric code used for international transfers, and it tells the network which bank you're dealing with, which country it's in, and in some cases which specific branch.

What these fees actually cost you

Here's the part nobody warns you about. Your bank tells you what it charges to send the wire, but it doesn't tell you how many banks will touch your money on the way there, or how much each one takes before passing it along. Those deductions happen silently, with no notification and no breakdown. Your recipient just gets less than you sent.

Here's what a single international wire can actually cost:

[Table:1]

Lifting charges are fees that intermediary banks deduct for handling the payment, and they come out of what your recipient receives, not from what you were quoted upfront. The FX markup is where money disappears without a line item. When an intermediary bank handles the currency conversion, it uses its own rate rather than the real market rate, and that gap is profit for them and a cost you didn't see coming.

If your wire passes through 2 intermediary banks, that's potentially USD $30 to USD $100 gone before your recipient sees a cent. For a founder paying vendors, contractors, or a team across markets, this adds up fast and turns into a reconciliation problem that eats into your time as much as your budget.

The OUR, SHA, and BEN charge options

When you set up an intermediary bank for wire transfers, most banks let you decide how the fees are split. This is specified in the SWIFT message in a field called "Details of Charges." You'll typically see 3 options:

1. OUR means you as the sender cover all fees. Your recipient gets the full amount you intend to send. Your bank estimates the intermediary fees and collects them upfront.
   
2. SHA (shared) means you pay your bank's outgoing fee, and any remaining fees are deducted from the amount your recipient receives.
   
3. BEN (beneficiary) means all fees, including intermediary fees, are deducted from the transfer. Your recipient absorbs the entire cost.
   

For a founder paying a vendor a specific invoice amount, OUR is usually the most reliable way to ensure the right amount arrives. That said, not all banks offer all 3 options, and OUR estimates aren't always accurate if the exact number of banks in the chain isn't known in advance.

Common intermediary banks in global transfers

Intermediary banks are typically large, globally connected institutions with the infrastructure and relationships needed to move money across borders. When your bank doesn’t have a direct link to the recipient’s bank, these are the institutions that step in to route the payment.

Some of the most commonly used intermediary banks include:

1. Bank of America: One of the largest US banks, supporting international payments and global banking services
   
2. BNP Paribas: A French banking group with strong coverage across global financial markets
   
3. BNY Mellon: A global investment bank known for custody and transaction banking services
   
4. Citibank: A major player in international payments and trade finance
   
5. Deutsche Bank: A leading European bank active in cross-border financial flows
   
6. HSBC: An international bank with one of the largest correspondent banking networks
   
7. JPMorgan Chase: A global financial institution facilitating large-scale cross-border transactions
   
8. Standard Chartered: A multinational bank focused on emerging markets and international trade
   

These banks usually operate behind the scenes. You will not interact with them directly, but they play a critical role in ensuring your money reaches the right destination when payments move across different banking systems.

How to find intermediary bank information

As a founder, it is important for you to know the intermediary bank information. Knowing this before you send a wire can help you plan costs beforehand. Following are the most reliable ways to find the information you need:

Ask your bank directly

When setting up an international wire, ask which correspondent or intermediary bank your bank uses for that specific currency and destination. Some banks will tell you. Others won't confirm it in advance, which is itself useful information about how transparent your bank is.

Ask your recipient's bank

The receiving bank often knows which bank handles incoming USD wires on their end. Your recipient can check with their bank and pass those details on to you.

Check your bank's wire instructions

Many banks publish intermediary bank details in their international wire FAQs or help pages. You'll usually see a bank name, address, and SWIFT number listed.

Request the SWIFT message after the transfer

Once a wire is sent, the accompanying SWIFT message contains the details of every bank in the chain. Your bank can share this on request. It's especially useful if a transfer has gone missing or arrived short.

Decode the code

Once you have a SWIFT code, you can identify the institution it belongs to using any public SWIFT lookup tool. The first 4 characters identify the bank, the next 2 identify the country, the next 2 identify the city or location, and the final 3 (optional) identify the branch.

Why this matters more as you scale globally

If your business operates entirely within the US, you don't need to think about any of this. ACH and domestic wire transfers stay within the US banking system and don't involve any of the banks described above.

The moment your business crosses a border, though, this becomes a real concern. And for a founder building across markets, it creates 3 recurring problems:

1. Unpredictable costs: The top 10 US banks charge an average of around USD $38 for outgoing international wires, before any deductions mid-chain. Without knowing how many banks will handle your transfer, it's genuinely difficult to budget accurately for payment costs.
   
2. Delayed payments: Each additional bank adds processing time. A transfer that should take 1 to 2 business days can stretch to 4 to 5 when multiple banks are in the chain, and longer if there's a compliance review anywhere along the route.
   
3. Reconciliation headaches: When vendors or team members receive less than what you sent, your accounting gets complicated. You end up chasing discrepancies instead of running your business.
   

These issues create a lot of risks for founders. The vendor relationships can strain when payments arrive late or short. Payroll timelines can slip, and if a transfer needs to be recalled or traced, you’re dealing with multiple institutions across different time zones, each with limited visibility into the full chain.

At scale, this isn’t just a finance issue. It becomes an operational bottleneck that slows how confidently you can move money across markets.

The bottom line

Intermediary banks are a structural part of how international wires work. They exist because the global banking system is fragmented, and not every institution has a direct relationship with every other.

If you're running a business that pays people across borders, these hidden charges can quietly add up and hurt your finances. Simply understanding where your money goes is a big first win, and the next win is picking a payment setup that gives you clarity instead of confusion.

Aspire's global payments infrastructure is built for founders who operate across borders. When you send international payments through Aspire, you get transparent FX rates with no hidden markups, so you can see exactly what you're sending and what arrives on the other end.

For US-based operations, the Aspire business account comes with free ACH, wire, and real-time transfers, FDIC insurance through Column N.A.¹ up to USD $100M, and 24/7 human support for when things need to move fast.

Frequently asked questions about intermediary banks

1. What is an intermediary bank and when is one used?
   

An intermediary bank is a third-party bank that steps in when the sending bank and the receiving bank don't have a direct relationship. It's most common in international SWIFT wire transfers.

1. How much do intermediary bank fees typically cost?
   

These fees generally range from USD $15 to USD $30 per bank. If your transfer passes through 2 of them, that's potentially USD $30 to USD $60 deducted before your recipient sees the money, on top of your sending bank's outgoing wire fee and any receiving bank fees.

1. What is a SWIFT number for a bank and how does it connect to this?
   

A SWIFT number, also called a BIC, is an 8 to 11 character alphanumeric code that uniquely identifies a bank in the international payments network. Every institution involved in an international wire, including any bank in the middle of the chain, has its own SWIFT number.

1. What is the difference between an intermediary bank and a correspondent bank?
   

The key difference is that a correspondent bank typically has a formal, pre-existing account relationship with one of the banks in the transaction. Intermediary bank is a broader term covering any bank between the sender and recipient.

1. How can a founder reduce or avoid intermediary bank fees?
   

A few practical options: choose the OUR payment instruction when sending a wire so your recipient gets the full intended amount; pay in your recipient's local currency where possible, since this can reduce or eliminate some intermediate bank steps; consolidate smaller transfers into fewer, larger ones to limit the number of fee-incurring transactions; and consider a payments platform built for cross-border business that offers direct payment rails and transparent FX pricing from the start.