Telegraphic Transfer or telex transfer, often abbreviated to TT, is a term used to refer to an

electronic funds transfer Electronic funds transfer (EFT) is the transfer of money from one bank account to another, either within a single financial institution or across multiple institutions, via computer-based systems. The funds transfer process generally consists ...

. Although the term is historic and the technology it describes is no longer in use, the telegraphic transfer name is still used today in several countries where it has become synonymous with an international Society for Worldwide Interbank Financial Telecommunication (SWIFT) transfer.

History

Historically telegraphic transfer meant a

cablegram Telegraphy is the long-distance transmission of messages where the sender uses symbolic codes, known to the recipient, rather than a physical exchange of an object bearing the message. Thus flag semaphore is a method of telegraphy, whereas pi ...

from one bank to another in order to effect the transfer of money, hence the name. This was later replaced by a message directly between banks via a

telex Telex is a telecommunication Telecommunication, often used in its plural form or abbreviated as telecom, is the transmission of information over a distance using electronic means, typically through cables, radio waves, or other communica ...

network and then later by an electronic funds transfer. Despite the obsolescence of the technology that spawned the term, the term is still in use today and usually used to describe an international electronic bank transfer.

Current use

Japan

Unlike its use in other countries, in Japan, "telegraphic transfer" has become the industry term for quoting retail

exchange rate In finance, an exchange rate is the rate at which one currency will be exchanged for another currency. Currencies are most commonly national currencies, but may be sub-national as in the case of Hong Kong or supra-national as in the case of ...

s (larger quantities are quoted individually), and is divided into three rates, stated in

yen The is the official currency of Japan. It is the third-most traded currency in the foreign exchange market, after the United States dollar and the euro. It is also widely used as a third reserve currency after the US dollar and the euro. T ...

, from the point of view of the quoting bank: * TTM: Telegraphic Transfer Middle rate (

mid price In financial markets, the mid-price is the average price between a seller's ask price of a stock or other commodity and the best buyer bid price of that stock or commodity. In some cases, the mid-price will be rounded up or down to the nearest "tic ...

) * TTS: Telegraphic Transfer Selling rate (

ask price Ask price (also called offer price, offer, selling price, asking price, or simply ask) is the price a seller states they will accept. The seller may qualify the stated asking price as firm or negotiable. Firm means the seller is implying that th ...

) * TTB: Telegraphic Transfer Buying rate (

bid price A bid price is the highest price that a buyer (i.e., bidder) is willing to pay for some goods. It is usually referred to simply as the "bid". In bid and ask, the bid price stands in contrast to the ask price or "offer", and the difference betw ...

) The middle rate is the average of the buying and selling rate, and these trade at a fixed bid–offer spread (in yen). For example, the USD is quoted with a spread of 2 JPY, so if the mid-market rate is 100 JPY = US$1, the rates are as follows: * TTS: 101 JPY: bank will charge ''more'' than mid price to sell USD * TTM: 100 JPY: average, bank does not trade at this price * TTB: 99 JPY: bank will pay ''less'' than mid price to buy USD These rates are published daily by major Japanese banks, and used for accounting and tax calculations, in addition to retail use.

Singapore

The term Telegraphic Transfer is a frequently used term in

Singapore Singapore, officially the Republic of Singapore, is an island country and city-state in Southeast Asia. The country's territory comprises one main island, 63 satellite islands and islets, and one outlying islet. It is about one degree ...

to describe cross-border funds transfer. Other less commonly used terms in Singapore are

wire transfer Wire transfer, bank transfer, or credit transfer, is a method of electronic funds transfer from one person or entity to another. A wire transfer can be made from one bank account to another bank account, or through a transfer of cash at a cash ...

and bank transfer.

United Kingdom

The term is now most often used in UK

banking A bank is a financial institution that accepts Deposit account, deposits from the public and creates a demand deposit while simultaneously making loans. Lending activities can be directly performed by the bank or indirectly through capital m ...

and in law to refer to either a domestic transfers by a

CHAPS Chaparreras or chaps () are a type of sturdy over-pants (overalls) or leggings of Mexican origin, made of leather, without a seat, made up of two separate legs that are fastened to the waist with straps or belt. They are worn over trousers and ...

or an international transfer by

SWIFT Swift or SWIFT most commonly refers to: * SWIFT, an international organization facilitating transactions between banks ** SWIFT code * Swift (programming language) * Swift (bird), a family of birds It may also refer to: Organizations * SWIF ...

. The term is also sometimes incorrectly used to describe other electronic funds transfer methods such as low cost everyday payment methods such as BACS (Bankers' Automated Clearing Services) payments,

Faster Payments Service The Faster Payments Service (FPS) is a United Kingdom real-time gross settlement system which facilitates transfers between different banks' customer accounts within a few seconds. The system offers faster settlement times than the long-establ ...

and SEPA credit transfers.

References