Bank Transfers: What They Are and How to Do Them

For business owners, moving money quickly to your bank account can make the difference in paying your bills on time or not. What is a bank transfer? Are there limits? How do you transfer money from one bank account to another?

Square cannot provide advice on tax issues. This article is for educational purposes and does not constitute legal or tax advice. For specific advice applicable to your business, please contact a professional.

For business owners, moving money quickly to your bank account can make the difference in paying your bills on time or not. You can use bank transfers to move around funds, accept payments from a customer, pay taxes associated with your business, and pay suppliers.

What is a bank transfer?

A bank transfer is a payment method that allows consumers and business owners to transfer money to a bank account. For business owners, this will typically happen when you are looking to transfer money from sales related to your business to a business bank account. 

If you use Square for your business, there are several types of transfers available:

  • Standard next-business-day transfer: When you activate your Square Point of Sale account, link a bank account, and start accepting payments, funds will transfer on a standard schedule of 36 hours to one to two business days within a transaction. 

  • Instant transfer: If instant transfers are available on your account, you can send funds to your linked, external bank account 24 hours a day, seven days a week, for a 1.5% fee per transfer. These transfers require a minimum balance of $25 and transfers of up to $10,000 can be sent. Balance not sent instantly will be sent on your normal schedule.

  • Same-day transfer: Same-day transfers are also available for a 1.5% fee per transfer and the most similar to instant transfers. These transfers are available to automatically transfer your funds at close of day, on an automated schedule you choose. You can send multiple payments as large as $10,000 with same-day transfers, but payments above that amount must be sent by next-business-day transfer.

Square Checking offers a checking account that gives you instant access to your sales with Square. You can use this account and routing numbers to allow third parties to debit your Square Balance using ACH at no additional cost to complete payments for things like bills or expenses.*

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Are there bank transfer limits?

When it comes to transferring money to any external bank account, the dollar amount limit — as well as speed of transfer — will depend on the banks involved in the transfer as well as the type of transfer itself. Below are some of the limits at common banks as well as Square transfer limits.

Bank transfer limits

Type of transfer Transfer limit
ACH Same Day transfer Up to $1,000,000
Bank of America Corp.  $3,500 per day or $10,000 per week
JPMorgan Chase & Co. Up to $25,000 per day
Citigroup Inc. Standard ACH Up to $10,000 per day 
Capital One Financial Corp. Up to $10,000 per day or $25,000 per month

Square transfer limits

Type of transfer Transfer limit Speed of transfer
Standard next business day None 1 to 2 business days.
Instant transfer Up to $10,000 Instantly 24 hours a day, 7 days a week.
Same-day transfer Up to $10,000, however, your transfers can be sent in more than one batch as long as no individual transaction is greater than $10,000. Daily at 5:15 p.m. PT / 8:15 p.m. ET or 15 minutes after your close-of-day time.

What is the difference between a bank transfer and a wire transfer?

While bank transfers and wire transfers are both types of electronic funds transfers (EFT), they do have some key differences. Wire transfers are often thought of as electronic checks — as soon as a transfer is started, it is taken out of your account. Unlike a bank transfer, a wire transfer doesn’t require bank accounts to be linked to one another in order to transfer funds. These types of transfers often come with a fee that can range depending on the payment service of the bank involved in the transfer.

Bank transfers can be sent from one internal account to another, from your bank account to an external account, and from your payments processing account to your bank account. These transfers typically cost less as they require lower fees (if at all), but do come with limits on dollar amounts per transfer as well as number of transfers you can send.

Is a bank transfer secure?

Bank transfers are considered a safe and secure method of payment, as there is proven identity verification associated with the transfer itself. However, it is critical to ensure you know who you are sending the money to. Whether you are initiating a bank transfer to an external bank account or a different account within your own, double check the name of the recipient. Once a transfer is initiated it cannot be canceled. As with other digital banking functionalities, the alternative could be less secure. Transferring funds to a bank account in cash form includes the steps for transporting money yourself and any security risks involved with physically moving that money from one location to another.

New Square sellers may be limited to $2,000 per day. Funds generated through Square’s payment processing services are generally available in the Square balance immediately after a payment is processed. Funds are subject to your bank’s availability schedule, but are generally available in your bank account within 20 minutes of initiating an instant transfer.