Transfer times are also likely to be faster, and currency risk solutions are often offered as part of a process where large money transfers are involved.
Business money transfers key points
Business money transfers are impacted by the following factors:
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Exchange rate
You’ll get better exchange rates when using a money transfer company for international business transactions vs. using a bank.
A money transfer provider will charge from the mid-market rate (0%) up to about 2%. This will be dependent on where the money is going.
This rate can also be agreed in advance and have a forward contract put in place.
Banks on the other hand can charge upwards of 1.5% to around 5% in some locations.
On large transfers, this greatly impacts the overall cost, and on smaller transfers, it simply does not need to be paid.
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Fees
As well as better exchange rates, money transfer companies often have lower fees than banks.
It is possible to get fee-free transfers from a lot of business providers.
Particularly when sending as part of a wider multi-currency account agreement.
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Currency risk
With a money transfer company, currency risk can be factored into a transaction.
Using self-serve portals it is often possible to guarantee a rate for sending for a short period of time, around 2 days.
For larger amounts, using an account-managed service allows for a forward contract or limit order to be put in place.
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Regularity of payments
With regular payments, for payroll or suppliers, money transfer companies can help reduce overall cost.
Using wallets or multi-currency accounts means EURs can be sent directly to EURs for example, as opposed to sending from USD or GBP accounts to EUR.
For regular payments, this ensures clarity on all upcoming payments and processes that will be part of financial planning.
With currency risk planning involved here as well.
Service (online or managed)
Choosing to use a money transfer service for sending business payments can be done in one of two ways. An account-managed option or a self-serve option.
Most companies do offer both options, but not all.
Generally speaking, self-service options are better for smaller transactions, or fulfilling forward contracts.
Managed options are best for where there is a large amount of currency risk, and the use of an account manager can help put in place strategic measures to mitigate risk.
Why opt for them over sending via a bank
There are a few reasons to opt for a money transfer company over using a bank account, there are:
Cheaper business transfers
Faster business transfers
Reduced currency risk
Access to multiple currencies
Be clear on
This is apparent for both the country and the currency being sent. For businesses, most core markets are covered and a lot of emerging markets also. However, depending on the specific route of the transfer it may be best to use a specific provider.
The best way to understand which provider is correct is to carry out a search for the route, currencies, and amount being sent.
This will give you the fastest and cheapest options, plus the exact cost, for the transaction.
The providers
Compare business money transfers
Use cases
Money transfer providers are used by many different company types across the world. Here are some examples of where they have been used.
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Recapping cross border payments for business
Money transfer companies offer better exchange rates and lower fees on cross border transactions
Money transfer companies will often be the fastest way to send money
Money transfer companies also provider access to currency risk solutions, multi-currency accounts and can be used for receiving international payments
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