When I transfer money from my bank account to another, the money disappear immediately from my account but they appear after one or two days in the other account.
Where exactly is my money during this period? Who hosts it? Am I insured against loss? What happens if the the sender’s or the receiver’s bank bankrupts at that exact time?
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>Where exactly is my money during this period? Who hosts it?
Essentially the bank (or transfer service) is “holding” it, while they do paperwork to make sure the transfer is legit and properly documented and everything.
>Am I insured against loss?
It would probably depend on the contract/terms of service with the particular bank or service, but usually yes. Also there’s laws that say like “if you say this is a simple money transfer, that’s a binding contract and you can’t just lose the money. The customer can sue you for their property back.” And if its just between accounts at an FDIC-insured bank, then yeah it’s definitely insured.
>What happens if the the sender’s or the receiver’s bank bankrupts at that exact time?
It would seem unlikely that a bankruptcy could occur so quickly that a transfer could get lost in the 1-2 days it takes to complete. If one or the other bank is going out of business, they would stop allowing/accepting transfers probably weeks if not months before they actually went bust. Any pending transfers would be completed in the few days after they made that announcement, and then no further transfers would be accepted.
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