Making International Business Payment? Here’s What You Need to Know

You have business transactions going overseas.

You finally achieved your goal of having your brand’s global outreach touch its peak.

Yet, the banking hassle that comes with making international business payments might still be haunting you and that is why you are here.

To help you navigate the tedious processes in an international business transaction, we break down everything you need to know- what international business payment essentially means, what are your different options and how to go about doing it.

Read on…

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What Is an International Business Payment?

International business payments involve the movement of funds between accounts located in different countries.

International business payments commonly involve different currencies, with foreign exchange operations.

The significance of international business payments cannot be overstated.Without such transactions, international trade would be impossible.

The seamless flow of funds across borders enables businesses to engage in international collaborations, fosters economic growth, and empowers individuals to participate in the global marketplace.

What Are the Different Types of International Payments?

International business payments offer various options for execution. Bank transfers and card payments are generally what , involving currency exchange. Meanwhile, alternative methods like cryptocurrency, mobile payments, and e-wallets are gaining prominence as well.

1. Wholesale Payments

Wholesale payments are transactions conducted between banks and financial institutions, serving as a foundation for consumer and business operations.

This category of payments encompasses activities such as borrowing, lending, and foreign exchange. Wholesale payments also play a crucial role in facilitating imports, exports, and market trading for governments and corporations.

1. Retail Payments

Retail payments encompass transactions between businesses and consumers, covering a wide range of activities including e-commerce purchases and employee salary payments.

Put simply, any transaction that is part of our daily routine can be classified as a retail payment.

Options for International Business Payment Processing

1. Traditional Bank Transfers

Historically, banks have played a major role in facilitating international transfers. Business owners would provide their international bank account details to authorized bank representatives, who would then initiate SWIFT transfers. Bank transfers have traditionally taken 1-5 business days for payments to be delivered.

2. Fintech Services

Fintech companies play a vital role in assisting firms with international business payments. Here's how fintech helps businesses in this area:

Streamlined Payments: Fintechs provide digital payment solutions that simplify and international business payments.

Faster Transactions: Leveraging advanced technology and payment networks, fintech enables faster settlement of international business payments.

Compliance Support: Fintech platforms integrate compliance checks to ensure businesses meet anti-money laundering (AML) and know-your-customer (KYC) requirements.

How Do International Business Payments Work?

1. Payment Request: The recipient, usually the business or vendor receiving the payment, provides the sender with the necessary payment details, such as the invoice amount, currency, etc.
2. Payment Instruction: The sender prepares a payment instruction that includes the receiver’s banking information, such as their bank account number, SWIFT/BIC code, and relevant details.
3. Sender's Bank: The sender initiates the payment by submitting the payment instructions to their bank. The bank verifies the account balance and ensures compliance with regulatory requirements, and processes the payment. Banks may charge a fee for this service called NOSTRO charges.
4. Intermediary Banks: In some cases, the payment may pass through one or more intermediary banks, depending on the payment route.
5. Foreign Exchange: If the payment involves a currency conversion, the payment amount is converted from the sender's currency to the receiver’s currency. Foreign exchange rates are applied during this process.
6. Recipient's Bank: Once the payment reaches the recipient's bank, the funds are credited to the recipient's account based on the provided payment instructions.
7. Payment Confirmation: The recipient's bank confirms the successful payment to the recipient, usually in the form of a SWIFT invoice, payment advice, bank statement, etc.

How Do You Make an International Business Payment With Karbon Forex?

With Karbon by your side, businesses can unlock a treasure trove of opportunities, accepting payments from over 165 countries. Gone are the days of complicated currency conversions and hefty exchange fees.

Karbon has cracked the code, providing a seamless, hassle-free experience for international business payments. It's time to embrace a world of limitless possibilities, where international payments are no longer a challenge

• Customer Support: Experience exceptional client support like never before with Karbon. No more worrying about the status of your transactions. Simply log in to your Karbon User dashboard, and all the information you need will be right at your fingertips. But wait, there's more! In case you have any queries or need assistance, our dedicated team of customer executives is just a phone call away.
• Hassle-free compliance process: Say goodbye to the headaches of compliance processes with Karbon. We've streamlined everything to make it hassle-free for you. All you need to do is provide the necessary documents and leave the rest to us. Our expert team will handle the compliance procedures with efficiency and precision
• Cheapest markup rates: Unlock unbeatable savings with Karbon! Our markup rates are a jaw-dropping three times cheaper than those offered by traditional banks in India. With Karbon, you can enjoy the same reliable and secure international payment services at a fraction of the price. Experience the power of affordability with Karbon today! Sign Up Now!

FAQ

1. Is it necessary to have a business bank account with Karbon in order to initiate an international payment?

Answer: You do not need to have a current account with Karbon to make an international business payment. If you are conducting a transaction from any of the RBI-recognized banks such as ICICI, AXIS, HDFC, or others, your payment will still be processed seamlessly.

2. How long will it take for an international payment to get fully processed?

Answer: If you are making a payment to a vendor listed in our historical transaction records, we ensure a quick transaction time of as little as 24 hours (provided all required documents from your company's end have been provided). However, for first-time transactions with new vendors, the processing time may take up to 3-5 working days.

3. What are the charges associated with making an international business payment?

Answer: Karbon provides transparent disclosure of all fee components, including form 15 CA 15 CB, SWIFT fee, NOSTRO fee, and more. Contact us now to find out the markup fee you are eligible for!