What is the first step in a funds transfer?

The first step in a funds transfer process is the originator's payment order. This step involves the individual or entity initiating the transfer providing instructions to their financial institution regarding the amount of money to be transferred, the recipient's details, and how the funds should be transferred. This order is crucial as it sets in motion the entire transfer process.

Once the payment order is received by the originator’s financial institution, the institution begins processing the transaction according to the order specified. The subsequent steps, such as confirming receipt or completing the transaction, can only occur after the payment order has been established and acted upon. Thus, the payment order not only initiates the funds transfer but also outlines the basic parameters and intentions of the transfer, making it foundational to the entire procedure.