International Business Money Transfers

Whether you want to pay suppliers or expand into global markets, you’ll need to make an international business money transfer to send money abroad.

However, sending money to another country can be complicated, time-consuming and expensive.

In this article, I will explain the different types of international business transfers and how you can send money to other countries.

What is an International Business Transfer?

An international business transfer is when a business sends money electronically to another country.

Businesses can send money to almost any country, making doing business with suppliers, partners, and customers in different countries easier.

However, international transfers can be expensive because there are fees involved in sending the money.  

On top of that, the exchange rate between currencies can fluctuate, meaning the amount of money the other business receives might be different than what you send because of currency conversion.

What is an International Wire Transfer? 

Wire transfers are a secure and commonly used method for electronically sending money internationally in business transactions. 

They’re preferred for their speed, typically delivering funds to the recipient within 1 to 5 business days, faster than traditional cheques or bank drafts.

The process can be initiated electronically through specialist money transfer services like TorFX or your bank’s online platform, providing a streamlined transfer experience. Alternatively, you can contact your bank in person or by telephone to initiate the transfer.

Despite their security, wire transfers often involve significant fees, including initial charges by your bank and receiving fees by the recipient’s bank. 

Additionally, they are subject to fluctuating currency exchange rates, which may affect the final amount received due to conversion fees or mid-market rate fluctuations.

What is a SWIFT Transfer?

 SWIFT transfer is a wire transfer that uses the SWIFT network to send and receive money internationally between banks.

SWIFT stands for “Society for Worldwide Interbank Financial Telecommunication,” which is the organisation that helps banks communicate with each other securely.

Mainly used for international payments, the SWIFT network provides a standardised messaging format that streamlines the transfer process and reduces errors.

It uses an 8 to 11-character alphanumeric code that helps identify the bank within the global network. 

However, SWIFT transfers may involve complex processes and documentation requirements, particularly for businesses unfamiliar with international banking procedures.

Similarly, not all banks or financial institutions may have direct access to the SWIFT network, which could limit the availability of SWIFT transfer services in specific regions or for certain types of accounts.

Whilst a SWIFT transfer is a type of international business transfer, not all international wire transfers use the SWIFT network. 

Other networks and methods are available for transferring funds internationally, including SEPA (Single Euro Payments Area) for payments in participating Eurozone and non-Eurozone countries and ACH (Automated Clearing House) for transfers in the USA.

Best International Business Money Transfers

The best way to send international business money transfers depends on your needs and priorities. 

Providers like XE, Remitly, Wise and Revolut are best if you want to send smaller amounts of money, as they don’t have minimum transfer limits. 

Similarly, TorFX, OFX and XE are the best ways to send large international business money transfers. TorFX and OFX don’t have maximum transfer limits, whilst XE has a high limit of $15 million, approximately £11.7 million, per transaction.

The fastest way to send international money transfers is by using Remitly, with most transfers being received within 2 hours of payment. Alternatively, Atlantic, Revolut and Wise can offer instant transfers depending on the currency and transfer method.  

XE and Wise offer the most extensive currency support if you send money to multiple countries. XE supports over 190 currencies, and Wise supports 62, allowing you to send payments to more countries.

How to Send International Business Money Transfers

There are several ways you can send an international business money transfer.

1. Online Money Transfer Service: Providers like Currencies Direct and XE specialise in sending money to other countries and usually offer more competitive exchange rates and lower fees than traditional methods. However, some platforms may have limits on transfer amounts or destinations.
2. Through Your Bank: You can request an international business money transfer in person, by telephone or through your bank’s online platform. Although a secure, reliable and familiar method, international money transfers through banks are often expensive, with high fees and less competitive exchange rates. 
3. Payment Providers: Platforms like PayPal and Payoneer offer an alternative way to send money internationally. Transfers are faster than other methods but incur high fees and significantly lower maximum transfer limits, making them less suitable for sending large amounts of money. 
4. Cryptocurrency Transfers: Some businesses may use cryptocurrencies like Bitcoin or Ethereum for international transfers. While this method can be fast and potentially cheaper, its value could be more volatile, causing your recipient to receive less money.

What Information Do You Need to Send International Business Money Transfers?

To send international business money transfers, you typically need the following details and documents:

• Recipient’s Contact Information: You’ll need the recipient’s full name, address, e-mail address and telephone number.
• Recipient’s Account Details: The exact details you need depend on your transfer method but could include their bank account number, 8-11 character SWIFT/BIC code, IBAN and the bank’s name and address.
• TIN: Depending on the countries involved, the amount transferred and local regulations, you may need to provide your and your recipient’s tax identification number.
• Purpose of Transfer: Some countries may require you to specify the purpose of the transfer, such as payment for goods or services, investment, or personal remittance. You may be asked to provide an invoice or contract. 
• Your Identification: Depending on the transfer amount and local regulations, you may need to provide government-issued identification, such as a passport or driver’s license.
• Any Additional Documentation: Certain transactions, such as large transfers or those involving specific industries like finance or healthcare, may require additional documentation or compliance with regulations like Know Your Customer (KYC) and Anti-Money Laundering (AML) policies. This could include proof of address and source of funds. 

Having these details and documents ready ensures a smooth and efficient process when sending international business money transfers, minimising the risk of errors or delays.

How Much Does an International Business Money Transfer Cost?

Depending on your method, sending an international business money transfer can have different costs. 

Larger transfer amounts and expedited transfers typically incur higher fees, while online money transfer services like TorFX may offer lower fees than traditional bank wire transfers. 

Comparing different transfer options and understanding these factors can help businesses minimise costs and choose the most suitable method for their needs.

Transfer Fees

These are fees charged by the service or institution facilitating the transfer. 

Transfer fees can either be a fixed fee, a percentage of the transfer amount or a combination of both.

Banks typically charge between £10 and £50 per transfer, whilst online money transfer services like OFX are cheaper, with costs ranging from £5 to £20. 

Exchange Rate Markup

When converting your money into the recipient’s currency, banks and transfer services often apply a markup to the exchange rate. 

This markup represents their profit margin and can vary significantly between providers. 

The higher the rate, the less currency you will receive for your Pound. 

Traditional banks usually have an exchange rate markup of 1% and 3% above the mid-market rate. 

In contrast, online money transfer services like Wise have an exchange rate between 0.5% and 2%.

Intermediary Bank Fees

If the transfer involves intermediary banks to route the funds to the recipient’s bank, each intermediary bank may deduct a fee. 

Intermediary bank fees are common for international wire transfers and depend on the banks involved.

Typically, fees range between £10 and £30 per intermediary bank involved. 

Receiving Bank Fees

The recipient’s bank may charge a fee to receive the funds. 

This fee varies by bank and can range from £10 to £30 or more, depending on the recipient’s bank and fee structure.

Additional Charges

Some providers may levy additional charges for specific services, such as expedited transfers, currency conversion, or cancellation fees.

These charges can vary widely and may significantly impact the overall cost of the transfer.

How Long Does an International Business Money Transfer Take?

Wire transfers through banks can take 1 to 5 business days, whilst online money transfer services offer quicker transfers ranging from a few hours to 4 business days. 

Several factors influence the transfer speed of international business money transfers, including the processing times of the banks involved, regulatory requirements, and whether intermediary banks are involved. 

International business money transfers funded by bank account debit or credit may be processed faster than transfers funded by alternative methods like cash or cheque.

Similarly, transfers to countries with advanced banking infrastructure may be processed more quickly than those with less developed systems.

Sending money in widely used and highly liquid currencies may be faster than involving less common or illiquid currencies.

Can I Set Up Recurring International Business Money Transfers?

You can set up regular international business money transfers using several methods.

1. Online Money Transfer Services: You can schedule recurring international business money transfers using providers like Wise and TorFX. It’s quick and straightforward to set up, but certain services may restrict transfer amounts or frequencies. 
2. Standing Order: You can set up a standing order with your bank to automatically send a fixed amount of money to a recipient regularly. You’ll have control over the frequency and timing of payments, but it may be difficult to change these details once set up.
3. Direct Debit: Setting up a direct debit authorises a 3rd party, like a supplier, to automatically withdraw funds from your account regularly. Whilst convenient, you will have limited control over timing and amounts as the recipient initiates the transfer.
4. Payment Providers: Some platforms like PayPal offer options for setting up recurring international transfers. Services usually have buyer and seller protection for transactions but charge higher fees than other methods.

How Much Money Can I Send Through International Business Money Transfers?

The amount you can send through international business money transfers depends on the transfer method, service provider, and specific circumstances. 

Different banks, online money transfer services, or payment platforms may have their own limits on the maximum amount you can send in a single transfer or within a specific timeframe. These limits can vary significantly between providers.

International money transfers may be subject to regulatory requirements and anti-money laundering regulations. As a result, financial institutions may limit the amount you can send to comply with these regulations and mitigate the risk of fraudulent activities.

Similarly, your UK bank account or credit card may have limits on outgoing transfers, affecting the maximum amount you can send internationally. These limits may vary depending on your account type and transaction history. Established customers with a history of large and frequent transactions may have higher limits than new or occasional users.

Certain transactions, such as investments or business payments, may have higher limits than personal remittances or gift transfers.

Things to Consider When Sending International Business Money Transfers

When sending international business money transfers, it’s crucial to consider several factors to ensure a smooth and cost-effective transaction. 

1. Transfer Amount: Consider any fees, exchange rate markups, and destination country regulations that may affect the final amount received by the recipient. You should also be aware of limits on the maximum amount you can send in a single transaction or within a specific timeframe.
2. Exchange Rates: Compare exchange rates offered by different providers to ensure you get the best value. Be aware of any exchange rate markups or fees that may impact the overall cost of the transfer.
3. Fees: Evaluate the costs associated with the transfer, including transaction fees, intermediary bank fees, receiving bank fees, and any additional charges for services such as expedited transfers or currency conversion.
4. Payment Timing & Speed: Consider the timing of your transfer and payment speeds, taking into account factors such as business hours, holidays, and any cutoff times imposed by the provider for same-day processing.
5. Security: Ensure the transfer method offers strong security measures to protect your funds and sensitive information from unauthorised access or fraud.
6. Regulatory Compliance: Be aware of any regulatory requirements that may apply to your transfer and ensure compliance with applicable laws and regulations.
7. Customer Support: Consider the availability and quality of customer support provided by the transfer service provider or bank, especially if you encounter any issues or need assistance during the transfer process.
8. Payment Tracking: Check if the transfer service provider offers tracking or confirmation mechanisms to monitor the progress of your transfer and receive notifications once the funds are delivered to the recipient.

By carefully considering these factors, you can choose the most suitable transfer method and ensure a successful and efficient international business money transfer.

Frequently Asked Questions