Even if banks and money transfer companies ensure their payment systems are foolproof, there are many ways by which a remitter's money could be compromised, and the simple act of wiring money can lead to a considerable amount of headache and stress. For example, the wired money doesn't arrive in time for your sister's wedding or it somehow goes missing in transit.
Bear in mind that not all providers have insurance plans in place that will ensure your money is protected at all cost and in most cases, moneyback guarantees are provided only if an error was committed by the bank or one of its agents.
Osama Al Rahma, general manager of Al Fardan Exchange, says, "If the money does not reach the right beneficiary within the expected time frame, it could mean a few things: the sender supplied the wrong account number or incorrect beneficiary name, there's no advance payments infrastructure between the sending and receiving branch, or there was an internal "human error".
"It doesn't mean the money is lost. Any transaction should not be lost at any level. This is an obligation of all correspondent banks," he says.
"If the money did not reach the recipient, the transfer could have been delayed because some wrong information was provided — the account number did not match the beneficiary's name or a wrong branch information was given."
Human errors
"Certain human errors can also take place which might result in a delay in the transaction. Besides, how fast or slow the transfer goes through depends on the relationship between the remitting branch and the bank," he explains.
A customer also runs the risk of losing money if he's dealing with a stranger: you are making a down payment on your dream home to a broker in Nigeria who turned out to be a fraud.
Richard Musty at Lloyds TSB Middle East said that payments that are delayed or fail to reach their destination are usually a result of errors on the payment instruction itself, so it is the responsibility of the sender to ensure they quote the correct payment details.
No refund
Western Union pointed out that a money transfer can be paid out to the recipient within minutes, and after the funds are paid, consumers cannot obtain a refund even if the transfer was the result of fraud. "Once the money is sent and collected, it cannot be returned," said Marc Aubry, Western Union vice-president for marketing in the Middle East and Africa."
However, in cases where the money is released to an incorrect beneficiary because a sender provided the wrong account details, Lloyds TSB said the remitting bank would work with the beneficiary bank to try to get the funds remitted back to the sender.
