What is a 'Wire Fate Item'

Wire fate item is an archaic term that refers to a request made by a bank when it sends a check or draft for encashment to a bank in a different jurisdiction for prompt advice or notification of payment or non-payment. It is usually transmitted by bank wire or federal wire, which are high-speed electronic communication networks used for transmitting information on transfers of large dollar amounts and other extremely time-sensitive information.

BREAKING DOWN 'Wire Fate Item'

"Wire fate" items or acknowledgments are of critical importance, since notification of non-payment of a check needs to be made to the payee as soon as possible. The term "wire" has carried over from previous generations when most time-sensitive information was transmitted by telegraph.

Wire Fate Items in Practice

Check clearing is the process of moving funds from one account to another. When a check is deposited or draft initiated, funds may not be available immediately, as checks need to be transferred to the clearing system, where the bank that accepted the deposited check notifies the bank that issued the check that the funds are being requested by the depositor. Today, most checks are processed with electronic imagery, so this process is much quicker than decades ago when paper checks were sent between financial institutions for verification. The bank that received the deposited check may request or receive a wire fate item notification from the bank that issued the check, letting the depositing bank know if the check can be paid or not.

RELATED TERMS
  1. Wire Transfer

    A wire transfer is an electronic transfer of funds across a network ...
  2. Book Transfer

    A book transfer is the transfer of funds from one deposit account ...
  3. Positive Pay

    Positive pay is a banking service used to match the checks a ...
  4. Check

    A check is a written, dated and signed instrument that contains ...
  5. Check Hold

    A check hold denotes the maximum number of days that a bank can ...
  6. Electronic Check

    An electronic check is a form of payment made via the internet ...
Related Articles
  1. Personal Finance

    The Complete Guide to Checking Accounts

    Here is the A to Z of checking accounts: types of accounts, basics on check writing, debit cards, overdraft protection and much more.
  2. Personal Finance

    The Ins and Outs of Bank Fees

    These service charges could nickel-and-dime you right out of your nest egg.
  3. Managing Wealth

    Review: Discover Checking Account

    Will having a Discover checking account save you money? It will save you fees.
  4. Personal Finance

    Cut Your Bank Fees

    Find out how to get the bank to pay you for using their services, not the other way around.
  5. Personal Finance

    The 6 Different Types of Checking Accounts

    Know exactly what you are getting before you open an account with this guide to checking account options.
  6. Insights

    How to Open And Access an Offshore Bank Account

    You don't have to be a master criminal or billionaire to open an offshore bank account. This article will walk you through the process.
  7. Tech

    New Bank Account? Don't Be Without These 6 Features

    Certain banking features can make managing your finances easier, so it's important to choose carefully when opening a new checking or savings account.
  8. Personal Finance

    Which Banks Pay the Highest Interest Rates on Savings Accounts?

    Online banks offer the best savings account interest rates, but all banks offer the same features, so it pays to read the fine print.
  9. Personal Finance

    Your Second Chance at Checking

    If you've made a few banking mistakes in the past, several banks offer "second chance" checking accounts that overlook your history.
  10. Personal Finance

    The 8 Best Bank Perks

    Many banks are now offering free perks to entice new customers.
RELATED FAQS
  1. When do checks expire?

    There's a grace period for cashing checks, but depositors and issuers risk overdraft fees if a late check shows up unexpectedly. ... Read Answer >>
  2. How can I cancel a bank draft that I have purchased?

    Learn about a bank draft, how it works, the circumstances under which a bank draft may be cancelled, and what the cancellation ... Read Answer >>
  3. How do you Fund a Forex Account?

    Forex traders are usually given several options when deciding how to deposit funds into trading accounts, learn how and what ... Read Answer >>
Trading Center