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10th November 2011
Finding the best international payment provider
Raphaels Bank offers top tips to SMEs on reducing costs and risks
Back to news indexIncoming and outgoing payments are the life-blood of organisations. Finding a provider who can do both FX and payments seamlessly at the right cost is worth investigating as it can heavily impact cash flows. Raphaels Bank, the UK's leading independent bank providing CFX services to SMEs, offers top tips on choosing an international payment provider.
"There are a number of issues SMEs need to consider when conducting overseas trade," explains Tony Wilson, Director of Commercial Foreign Exchange of Raphaels Bank. "Businesses must ensure they protect their profit margins whilst maximising their opportunities to trade internationally. With some initial investment in time researching the options and costs, businesses can find a fast, efficient payment system designed to deliver the best results for their international customers and suppliers."
- Count the Cost - a good provider should minimise correspondent bank charges, for a faster, affordable payment service
- Reduce Errors - choose a provider that checks the details to avoid payments getting lost and incurring more charges
- Functionality - check you can add invoice numbers and references to payments
- Fixed Costs - find a supplier that can fix your payment costs to suit your business
- Visibility - make sure you can view payments and incoming funds online
- Confirmations - Ensure you get an immediate confirmation of the transaction clearly showing the transaction and costs
- Brokers - watch out for brokers that have to rekey payments, increasing the risk of errors
- Customer Care - don't trust a bank or broker's customer service claims without testing them
- Dedicated Service - request a dedicated point of contact rather a general call centre
SMEs need to ensure their payments don't incur additional time and costs, for example some High Street banks may send electronic funds transfers (EFTs) via multiple correspondent banks before the funds get to their final destination. If they are not routed correctly payments will cost more and take longer. Also some of the largest global Banks leave the liability with the customer. This means if the business enters the detail incorrectly the bank can still release the payment and not repair the anomaly of the data. The first thing a business will know about the problem is the beneficiary chasing payment.
Tony Wilson adds: "Payment providers should check the detail of a payment entered, otherwise it could get lost in the correspondent bank network. Locating a lost payment can take weeks and a business could end up paying the same supplier twice. In addition, once the funds are returned, they may have been exchanged on a number of occasions, resulting in more charges.
Also, look for a supplier who will fix payment costs and make sure international incoming and payout funds are viewable online.
Finally, try before you buy. A good gauge of customer care is if the FX and payment provider requests your beneficiary data to check and upload your payment data prior to you using their systems. They will also give you a dedicated contact, rather than a general call centre. By taking the time to choose the right payments and FX partner, SMEs can benefit from a seamless international payment processes, enhancing the strength of their business and minimising the risks" concludes Tony Wilson.
