Leveraging Options for International Money Transfers for Small Businesses

BY: ON MONDAY, DECEMBER 18, 2017

In general, international money transfers are complicated, especially for small business owners. Financial leverage for a small business owner is limited, at least in the first couple of years of business. There is the need to keep the cash flow running smoothly and without any delays.

Dealing with domestic payments is simpler as payments are just a bank transaction away. However, collecting payments from international clients is risky without the correct resource because you’re essentially depending on the service of a financial facilitator to transfer the payment from the buyer to the seller (you).

Any delay, irregularity or lack of transparency on the part of the financial facilitator can bring the small business to a standstill, and that is a worse situation to be in.

Here are some:


. Moneycorp

Started in 1979, it is a trusted name in the foreign exchange industry with around £22.6bn in annual turnover for 2016. Moneycorp has a full banking license, highest credit rating D&B, sophisticated hedging offers, and has won many consumer and business awards.

Brands like CNN, Virgin Atlantic and The Telegraph have worked with Moneycorp. UK residents receive a prepaid MasterCard allowing the user to load multiple currencies. All the client money is safeguarded in differentiated client bank accounts, and there are NO fees for overseas payments. It is an authorized payment institution by the FCA.


. TransferWise

An authorized payment institution by the FCA, Taavet Hinrikus and Kristo Käärmann laid the foundation of TransferWise with the belief that money should flow freely, without any hidden transfer fees or delay in payment processing. The founder duo established the company in 2011 and the platform enables transaction in 38 currencies. They operate under the Financial Conduct Authority (UK), and users can trade via the online platform, mobile application, chat and email.

Currency transfers happen instantaneously, and they use a peer-to-peer money transfer system. In 2017, the company moved around $5 billion and served thousands of clients. Unlike other payment systems, the money doesn’t sit in the mediator’s accounts. TransferWise doesn’t hold the money. It directly facilitates the transaction between the payer and the receiver.


. Currencies Direct

Established in 1996, Currencies Direct is a payment transfer company authorized by Financial Conduct Authority (UK) and FinCen (USA). They have a ‘No Fees’ worldwide policy, and currently, they offer 63 currencies with a minimum transfer threshold of $100. They have over 150K active clients, worldwide offices in 18 places, and deals with £4.5+ billion annual transactions. They have the highest possible Dun & Bradstreet credit rating, implying that they have the lowest possible level of risk.


. World First

Established in 2004, World First enables three kinds of transfers – business transfers, online seller transfers and personal transfers. They conduct over 100,00,00 transfers per year, which is £54 billion globally. World First is regulated by Financial Conduct Authority (UK), Financial Transactions and Reports Analysis Center (Canada), FinCen (USA), Customs and Excise Department (Hong Kong) and ASIC (Australia).

The minimum transfer threshold is $1000 or £1000. Their transfer process is simple. The sender needs to contact them with the amount, nature of payment, receiver’s details and currency of choice. World First shares the conversion quote and the sender books the transfer. World First takes care of the rest.


Endnote

Unsorted payment channels pose a risk for any small business owner. If there are troubles with the current payment facilitator, it’s time to review other options, and I have mentioned some of the best ones above.





Image via Shutterstock

About the Author

Chitraparna Sinha

Chitraparna Sinha is the Founder and Director of Esmee Network. She's also a guest contributor for ChamberofCommerce.com

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