SMEs across the globe have had to pause much of their international activity this year, as a result of ongoing lockdowns and financial implications from the pandemic, but with a new year just around the corner, many are making plans for a more fruitful 2021.
As PagoFX for Business launches this week, enabling UK based small to medium enterprises to make fast and low cost international business payments, Rocio Almoguera runs through our top tips for SMEs on how to make sure you’re not paying over the odds for foreign transactions.
Here are our five top tips:
- Bank on FX Experts: Traditional UK banks typically can’t offer the range of payment options or innovative global payment technologies that FX specialists can, given their scope and size. There can also be a lack of price visibility when using a bank to make a transfer, meaning you can end up accepting whatever their exchange rate is at the time. Working with FX experts and dedicated money transfer services can give you access to more precise costs, advice on timings and ultimately, a better outcome.
- Track The Ever-Shifting Market: Global events like the pandemic, the recent US election and Brexit can shake economic and market confidence. As a result, there’s more risk of volatility in global exchange rates, creating cost implications for international payments. It’s worth staying cognisant of what’s happening both in the UK and more broadly across the globe to understand how news events may affect any upcoming or future transactions.
- Watch The Clock: There are certain times in the day or week which are more convenient for international transfers and also times which should be avoided, if possible. These are periods when profitability can rise or fall, depending on daily, weekly, and monthly patterns and trends. For example, market volumes and prices can change drastically first thing in the morning, meaning it might be worth avoiding foreign exchange transactions during these hours.
- Know Your Stuff: Some countries require additional information to process international payments, so it’s really important to make sure you check the specific requirements for the country you’re sending money to. For example, some countries (outside the European Union or European Economic Area) allow the bank receiving the payment to also charge a fee. It’s always good to ensure you know exactly what fees will be charged for your transfer and budget accordingly.
- Pay With Confidence: Using a trusted service like PagoFX for Business ensures you can make fast and easy international payments with confidence. You will get real-time, mid-market exchange rates with no added mark-up.
- New Year, New Rules: As a result of Brexit, from January, UK citizens will no longer be covered by the EU law which prevents mobile phone providers charging customers extra for making calls from a different country. Make sure you speak to your mobile provider to ensure you’re on the best package for business calls either from the UK to a foreign location or vice versa to ensure you’re not stung with an unexpected hefty bill at the end of the month.
- Lean on Expertise: If you’re thinking about expanding overseas for the first time or are just getting started with international payments, don’t expect to know everything from the outset. There are many blogs, social media pages, advice pages and customer support services from FX specialists and companies that are experts in this field and can help with any questions or queries you may have.
- Get Online, Not Left Behind: COVID has accelerated digital transformation across various industries, with customers and vendors expecting companies to be up-to-speed with digital platforms and offer efficient, online payment methods. Paying employees, freelancers and suppliers quickly in their local currency will help strengthen relationships and mutual respect, so make sure you also prioritise a digitally-enabled payment solution, as well as one that offers a good price!