If you’re paying international vendors and overseas suppliers in currencies different from your own, you may be dealing with:
There are a variety of methods you can use, each with its own benefits and limits. We’ve compiled the best ways to pay international vendors so you can find the right one for your business. In this article, we’ll cover 8, including:
Looking for greater transparency and convenience when paying international vendors? Try Jeeves Pay: the only business-to-business payment method with over 140 currencies to choose from, no hidden fees and a credit-backed approach that protects your cash flow.
Since we’re writing this article, we thought it would make sense to start with ourselves and be transparent about it.
Jeeves Pay is a new credit-backed business-to-business (B2B) payment service designed by Jeeves, a multi-currency financial infrastructure designed for companies with a global presence. Over 4,000 clients use Jeeves in 24 countries, including the US, the UK, the EU Canada, Mexico, Colombia, and Brazil.
With Jeeves Pay, you can use a line of credit to settle vendor invoices in over 140 currencies, without any additional service or processing charge.
Here are the advantages of using Jeeves Pay for paying foreign vendors and suppliers.
Jeeves Pay enables you to get started quickly because you can sign up and pay your foreign vendors in as little as 24 hours. There’s no need for a branch visit and you won’t have to wait days for us to process your request because Jeeves Pay is completely online.
We offer an easy 5-minute sign-up process and a 24-turnaround time to respond to your application. Once approved, you’ll have immediate access to Jeeves Pay and can send your transfer in just a few minutes.
Depending on the recipient’s country, your payments can settle instantly, on the same day or within 3 business days. For example, transfers to North America, South America and Europe can arrive as quickly as the same day.
We can give you more transparency on your international transactions because we make bank transfers on your behalf directly from our Jeeves remitter account to your international vendors’ bank accounts.
All Jeeves Pay transfers settle within 3 business days, with some country-to-country payments settling instantly or within the same day.
In the Jeeves dashboard, you’ll see how fast a payment will arrive as soon as you choose the currency and country. With this clarity, you can trade internationally with confidence, without worrying about late payment fees or waiting for products to be released.
Our fee is also transparent. Once you select your currency, you’ll receive a competitive interest rate to use the credit for one month. There are no additional costs, such as service charges, processing fees or transaction fees like other providers. You’ll also know the monthly interest rate upfront before agreeing to proceed with the payment.
Jeeves Pay is a multi-currency account so you can pay your suppliers and vendors across the globe.
You’ll get the best daily market exchange rate on the currency you choose. You can even ask for your line of credit in the currency of your choice. For instance, if you’re located in the US but have offices in Canada and Mexico, you can decide to receive credit in USD, CAD or MXN.
Jeeves Pay allows you to cut down on cross-border payment costs with no setup fees, no recurring fees, and competitive FX rates. You will be able to review the payment and the FX conversion prior to sending or scheduling your payment.
When you're sending funds to a new recipient, both parties may have to undergo a compliance check, known as a know-your-customer (KYC) or know-your-business (KYB) verification. These checks can delay your transfers by taking up to 5 to 7 business days or more to complete.
At Jeeves Pay, we also run a KYB, but ours are instantaneous so you can do business more quickly.
If we find any issues during our checks, we notify you immediately so you or the receiver can provide additional documentation (if required) as soon as possible.
As founders, we know how crucial timely communication is for business relationships, especially if you’re making advanced payments to release goods or services. But, often, B2B settlement times are unclear.
You’re never in the dark with your international transfers when you use Jeeves Pay.
With Jeeves Pay, you and your overseas vendor will receive an email notifying you that payment has left our remitter account and is on its way. Then, you’ll both receive a second email confirming the settlement of funds in the receiver’s bank within 3 business days.
This way, your global payments are more transparent without the hassle of having to reach out to your business partner or a customer service centre to know the status of your transfer.
Most banks and financial institutions apply caps on international payments, limiting the amount you can send in a single transaction. This means you’ll have to break a high-value transaction into many smaller-value transfers over several days to complete a single payment to your overseas supplier.
With Jeeves, you can send transfers that are as high as your self-funded Jeeves Cash balance.
For example, if you have a $100k balance with Jeeves, you can send $100k. If you have a $1m balance, you can send $1m.
Without the usual limits, you can better manage your overseas vendor and supplier invoices with one payment and save on additional processing fees of multiple payments.
With Jeeves Pay, you instantly become a Jeeves client. This means you’ll have access to a rolling monthly line of credit you that connects to:
Jeeves Pay is best for medium to large-sized enterprises making high-value or large-volume transactions overseas that want the added benefits of a complete financial infrastructure to help them grow their business more efficiently.
Sign up to Jeeves Pay today and you could be sending payments internationally (and domestically) in less than 24 hours.
International wire transfers are one of the most common ways to pay your global suppliers and vendors. Automated clearing house (ACH) and wire transfers tap into your cash flow by taking money directly from your business account.
Pros: Since this method is so common, it's an easier system to work with because banks will accept it worldwide. It’s also relatively cheap with overseas transfer processing fees ranging from $35 to $75.
Cons: International wires are prone to error. Since banking details can vary from country to country, you may not know until a wire bounces that there was missing or wrong information in a transfer. International wires may also have hidden fees and foreign exchange (FX) markups, which can increase your costs, but aren’t readily available upfront. Most times, you’ll only know the full cost when your transfer is about to be sent off.
International invoice payments also happen via an ACH transfer but in a different form.
With an invoice payment, your vendor or supplier will prefill their banking information to make sure there are no errors with the transfer process. This reduces the margin of error in bank wires where you have to fill in the banking information yourself.
Pros: Since the banking information is already filled in, there is less risk of error. And, like international bank wires, they are widely accepted and relatively cheap.
Cons: ACH transfers are slower than an international bank wire and can take up to 7 days. Just like wire transfers, they can also have hidden costs and markup fees, which can increase your costs.
Though not all foreign vendors and suppliers accept credit cards, some do. You can use your company’s credit card, prepaid or virtual cards to pay international invoices and settle overseas accounts payable.
Pros: Credit cards are a quick means of payment, with funds arriving in the merchant's account in near real time. If you have a company credit card that offers rewards, you could increase your margins with cash back or points you can convert into cash every time you make an overseas payment. You’ll also keep your cash flow healthy if you use a credit card versus a prepaid card.
Cons: Some overseas suppliers may require you to pay the additional fees credit cards charge merchants for receiving international payments. If so, they’ll stipulate these payment terms up front and add the cost to your international invoice. You also risk paying a high annual percentage rate (APR) on credit cards if you can’t pay off your monthly statements quickly.
In the end, whether or not you should use a credit card for making international payments depends on various factors. How much will a working capital loan with an interest rate cost you versus just sending the money directly? Or should you use a credit card and pay the processing fees charged by the vendor? Once you do the math, you can decide if card payments are beneficial to you.
You can open up a foreign currency account online or an in-branch foreign currency account where you can hold, send and receive funds in different currencies. These are also known as borderless or multi-currency accounts.
Pros: A foreign currency account can save you money because you can avoid FX fees and markups that come with currency conversion. You also won’t have to worry about currency exchange fluctuations.
Cons: Many banks and financial institutions offer only major currencies (USD, EUR, and GBP) for these types of accounts. So, if you’re working with overseas suppliers in countries that trade in currencies other than these, this method may not be your best payment option.
You can open up an overseas account if you’re paying several foreign entities from the same country or ones that are all using the same currency.
Pros: You’d be paying like a local, which means you won’t have to worry about FX fees and markups. Payments can also settle more quickly when they are in a local currency.
Cons: Opening a bank account overseas can be a complex process and could take weeks or months to set up. There will be legal implications to look into as well. You’ll still be at risk of currency fluctuations when you transfer funds from your domestic bank to your overseas bank.
Digital providers like PayPal, Zell, Venmo, and Wise provide bank-to-bank transfers on your behalf. You can get started with this type of payment method very quickly as they are all online.
Pros: These are near-instant transfers, which are not as prone to errors as other methods.
Cons: You’ll still incur processing fees, which vary between providers. You may also find that not all your vendors are so tech savvy and won’t accept these types of payments.
Payment solutions like Bill Pay are widely used in the U.S. and can work across multiple countries. You can access services like Bill Pay directly from your bank and use the cash reserve in your bank account to fund your transfer.
Pros: Bill Pay is widely accepted and can be a great fit for your finance teams and accountants because it connects to popular accounting software, your bank account and your company expense cards. You’ll have everything in one place so you can close your books quickly.
Cons: Unlike ACH or wire transfers, Bill Pay typically charges a flat fee and not a variable, which is good for any company making just a few large transfers per month, but not great if you’re making multiple payments per month, which may wind up costing you more.
We hope this selection of the best ways to start paying international vendors and suppliers has helped you understand which method is best for your company. International trading can vary widely so only you’ll know which method best matches your unique business needs.
With Jeeves Pay, you’ll not only pay your overseas supplier and vendors quickly, but you’ll also get access to a full suite of financial tools to help you run your business and expand globally.
Sign up now, get started in 24 hours, and start paying your international vendors with Jeeves Pay.