Ukrainians massively block money transfers: what is happening

Recently, customers of Ukrainian banks have begun to experience inconvenience associated with payment systems and money transfers.

The editors of Segodnya collected user reviews on the website of the Ministry of Finance and found out what the problems of Ukrainians who made the transfer of funds could be related to.

On June 25, a PrivatBank client transferred money from the USA using the MoneyGram service. The bank received the money, but they were not credited to the bank account. The funds were intended for the purchase of aid to the Ukrainian military.

The financial institution noted that the system automatically blocked the MoneyGram transfer. After processing the application for unblocking, money can be received through Privat24, self-service terminal, at an ATM or PrivatBank branch.

Some Ukrainians faced problems even earlier. In particular, on May 31, a client of Oschadbank was supposed to receive a SWIFT transfer in dollars. The operation was carried out in foreign currency through Wise to a foreign currency card in a Ukrainian bank, but two weeks later the money was not credited to the account. Subsequently, it turned out that the payment was frozen, and the money is now in an account with the American central bank.

According to the support service of Oschadbank, there are delays in crediting payments through the SWIFT system. The National Bank of Ukraine should understand the situation in detail and provide an explanation to banks and their clients.

A similar problem arose with a client of PrivatBank, who was supposed to receive money on June 8, but as of June 25 they were not credited. The transaction went through, but the money was returned to the account of the main US bank. The slow processing of transfers through Payoneer was also noticed by Monobank customers.

What could be the problem?

As Monobank co-founder Oleg Gorokhovsky explained, recently clients of Ukrainian banks have had problems sending transfers to Mastercard cards of other banks. This may be due to guarantee deposits covering such transactions in payment systems.

“The volume of transactions after the start of the war has grown significantly, and banks cannot send foreign currency for additional coverage”he remarked.

In particular, PrivatBank and Oschadbank regularly hit the 26-hour limit from Mastercard, which is set depending on the size of the security deposit. So far, representatives of Ukrainian banks are trying to negotiate direct transfers, bypassing payment systems.

Features of SWIFT transfers

International bank transfers SWIFT is a payment and information transfer system between financial institutions in most countries. More than 11 thousand banks and other organizations are members of the network. The system has existed for almost 50 years and is distinguished by the security of transfers.

However, the guarantee of security comes at a price of time. The peculiarity of SWIFT lies in the rather lengthy verification procedures, which can take up to 5 working days or more. If intermediary banks are involved in the transfer, this additionally affects the duration of the operation.

The source currency from one bank is converted into the destination currency before being received at another bank. Sometimes there is a double conversion that affects the size of the final amount.

At the same time, from April 1, when making transfers to the army or paying for treatment in the system, the commission was canceled. Until September 30, 2022, a 0% commission is also provided for crediting payments to a card for payments in hryvnia.

Segodnya used to compare how to send money faster and cheaper – using SWIFT or Western Union, and also told how Tinkoff steals money transfers to Russians and leaves customers without money.