Key Takeaways
- Cross-border payments are important to many businesses
- But high costs and slow payments can slow down critical operations
- Transparency and the ability to make mass payments are other issues
- Fortunately, there are ways to address these challenges
Cross-border payments are vital to businesses that work internationally.
However, the complexity of these transactions can cause challenges that impact your entire business and prevent it from operating in a timely manner.
Here are a few factors that you should be aware of — and some ways in which you might go about solving the problem.
Long Processing Times
Cross-border payments often take longer to complete than domestic transactions. Sometimes, cross-border payments take multiple days due to the involvement of intermediary banks and the need for extensive regulatory checks.
Delayed transaction processing doesn’t just slow down each payment — it can slow down all of your business operations.
For example, if a payment is not received on time, you might be prolonged in:
- Receiving orders from suppliers and vendors
- Filling orders for clients and customers
- Taking the next steps in important partnerships
- Signing on contractors and employees globally
Accordingly, it’s important to choose a payment solution with rapid settlement, which will allow all parties to receive payment by the time they need it.
Higher Costs
Cross-border transactions are often expensive, primarily because these payments include both transaction fees and conversion fees.
It’s also important to consider foreign exchange risk, which means that currency fluctuations can cause your business’ funds to lose value in FX transactions.
These additional costs can leave your company with fewer funds to put aside for other critical operations, such as:
- Purchases and other regular expenses
- Hiring staff and contractors
- Investing in new opportunities
- Pursuing business expansions
In short, failure to account for and accommodate extra costs can slow your business’ growth, meaning that saving money on foreign transactions is critical.
Lack of Transparency
Because cross-border transactions often move through several countries and third parties, it can be difficult to predict details and monitor status.
That means you might not know a transaction’s fees, rates, or expected completion time before you send it. Sometimes, you’ll find out after you initiate the transaction — but you might need to wait for it to reach its final destination.
This lack of transparency can cause problems for your business, including:
- An inability to manage cash flow and budget
- The need to pay overdue fees or interest on late payments
- Payment disputes and complaints from transaction partners
- The possibility of stuck, lost, and reversed payments
Unnecessary payment complications waste valuable time — but finding a payment solution that provides insight into your transaction status at every step can help you avoid all of these problems.
Large Payment Volumes
If your business is large enough, you’ll need to send and receive transactions between numerous parties, and the amount may overwhelm you.
Poor coordination can have unwanted effects on your business, like:
- Time wasted on manual payment scheduling and arrangement
- Unnecessary reliance on old and slow payment methods
- Funds needlessly spent on individual transaction costs
Fortunately, some services offer bulk payment tools that allow you to set up and schedule bulk payments, saving valuable time and resources.
How Payset Can Help Speed Up Your Global Payments
At Payset, we allow you to send and receive funds in more than 180 countries.
Plus, you can exchange more than 38 currency pairs through our FX exchange and hold 34 currencies in a multi-currency IBAN account.
You’ll be able to plan your payments and make them on time thanks to:
- 24/7 availability and fast execution
- Affordable and transparent fees
- Real-time foreign exchange rates
- Transparent rates and service pricing
- Ways to monitor your transaction status
- Bulk payments to multiple recipients
