What Are Global Payments and How Do Businesses Collect Money Internationally?

In a world of online marketplaces and cross-border contracting, even the smallest of businesses can take a global outlook. India’s a big country but the world is even bigger, and if you’ve got your eye on ambitious opportunities, there should be nothing standing in your way. Making the move into international markets will mean accepting international payments.

Global B2B payments: The basics

If you want to expand beyond national borders, you will need to accept international payments online. Whether you’re selling manufactured products abroad or providing services to global clients, you’ll need to consider how you’re going to accept global payments. It’s not quite as straightforward as taking domestic payments as there may be a foreign exchange element, as well as moving money between different financial regulatory systems.

Collecting international payments can be more complex for a number of reasons, including:

• Currency conversion: Exchange rates can be volatile and conversions can attract additional fees, so managing your FX activities is important
• Processing times: Even though the money isn’t physically travelling between countries, global B2B payments can take longer to process
• Regulatory requirements: Transactions that pass from one regulatory system to another need to comply with the rules of both, and even accidental non-compliance can cause problems or result in fines
• Additional risks: These include an increased vulnerability to fraud, as well as geopolitical factors that may affect the movement of money between countries
• Transaction costs: For international payments, these are naturally higher because of conversion fees and charges levied by intermediary financial institutions.

It may sound like a lot, but don’t let this put you off doing business abroad. By using a corporate payment system such as Payoneer, B2B payment optimization is simplified and the risks mitigated.

Ways to accept payments globally

Whether you need global contractor management solutions for global mass payments or simply want to get paid by clients based in other countries, you’ll need to consider different types of cross-border transactions.

There are lots of different ways to accept international payments, and which you choose will depend on the size and frequency of your transactions, the charges involved, the speed of transfer and the preferences of those you’re taking payment from.

These are some of the most common B2B cross border payment types:

• International checks – but beware of longer processing times
• International money orders are prepaid and are often used for small or less regular transactions
• Wire transfers – good for large transactions as they are highly secure
• Foreign exchange brokers can offer competitive rates for global mass payments, such as payment of overseas staff and freelancers
• Online payment platforms such as Payoneer will allow you to receive online payments and are good for ecommerce businesses and global service providers – they are fast and competitive, and suitable for businesses of all sizes
• For larger companies, corporate payment systems such as Kyriba and TIS can provide enterprise payment hubs to manage international b2b payments, bank transfers and things like Visa or Mastercard b2b cross border payments
• Cryptocurrency transfers fall outside the banking system and might be risky for users unfamiliar with crypto

Managing your global B2B payments

Making the move into global marketplaces can seem daunting at first, but the opportunities are too good to miss out on. If you can identify potential customers in other countries, it’s important to enable them to pay you in their own currency. Accepting international payments online brings a new dimension to your financial operations, but with these best practice tips you can simplify and expand your cross border operations.

Best practice measures to make international payment requests safe, secure and simplified:

• Establish your payment terms from the outset to ensure the person paying you understands which currency to pay in, who’s responsible for transaction charges, when the payment should be made and when late payment penalties will come into effect
• Keep up-to-date records of sales and services provided to ensure regulatory compliance across the countries in which you operate – using a payment platform such as Payoneer means you can automate many processes including your record keeping
• Understand all the costs involved before you select the payment methods you’ll accept, including transaction charges, FX fees, intermediary bank fees and payment system fees – platforms like Payoneer are competitive on charges and fees, and even offer free transactions between Payoneer accounts
• Use local receiving accounts and multi-currency accounts, as offered by Payoneer, so you can manage your foreign exchange transactions to your advantage
• Ensure your invoices include all the details your customers will need to make international payments to you – failing in this will lead to delays and missed payments
• Be fraud aware and do your due diligence – use a b2b payment service with a good reputation for security and customer support
• Make sure you understand and can comply with the regulatory requirements involved with accepting payments from different countries
• If you use a platform like Payoneer to automate your accounts receivable, you’ll also be able to automatically receive your FIRA/FIRS/NOC directly into your Payoneer account at no extra cost