Fees transferring USD to China

[19ninety]

I'm about to make a purchase from China, the company takes payments in USD rather than Chinese Yuan. They suggested PayPal however they charge a 3.5% PayPal handling Fee and the PayPal exchange rate is shocking so in all adding £75 to the total price.
Generally when I purchase from overseas I pay in their native currency, by bank transfer and I pay the associated fees. So I offered this as an option however they said they usually add $45 fee as when people transfer them $1000 they only receive $955. I can only guess that the $45 fee they mentioned they are charged is because their bank is receiving USD and having to exchange it to CNY?

Anyone got any experience making payments to China to can clarify what costs should be involved and what's the best way to pay, USD, CNY, Bank Transfer, PayPal?

Thanks,

 

[Daugela]

I wouldn't recommend transfers by a bank as they are very expensive, try alternative services like transferwise https://transferwise.evyy.net/c/420584/26105/985 I've used them many times, never any problems and exchange rate almost like quoted, excellent service.

 

[GraemeL]

We use CaxtonFX and make payment to our Chinese suppliers bank in USD.

 

[SH247]

I wouldn't recommend transfers by a bank as they are very expensive, try alternative services like transferwise. I've used them many times, never any problems and exchange rate almost like quoted, excellent service.

We use CaxtonFX and make payment to our Chinese suppliers bank in USD.

I'm in a similar situation.. the sourcing agent seems to be pushing for bank transfer. Do all sourcing agents accept systems like CaxtonFx and TransferWise? and are these the most cost effective ways of sending money to China?

 

[GraemeL]

I'm in a similar situation.. the sourcing agent seems to be pushing for bank transfer. Do all sourcing agents accept systems like CaxtonFx and TransferWise? and are these the most cost effective ways of sending money to China?

If they don't accept them then avoid them. Its a normal way of trading and yes its most cost effective for both parties.

 

[SH247]

If they don't accept them then avoid them. Its a normal way of trading and yes its most cost effective for both parties.

Graeme, I've put this to the sourcing agent I've been in contact with (one that I've seen recommended on this forum multiple times) and they are standing firm that they only accept bank transfer or PayPal... can you recommend an agent that you use? Can't imagine why they'd be refusing the methods suggested above..

 

[GraemeL]

CaxtonFX will send the money by bank transfer, exactly as required. You will need to input your suppliers bank details into the CaxtonFX system. I think there is some confusion in terminology.

 

[SH247]

Thanks very much. So CaxtonFx essentially are a bank, but without hidden fees that a high street bank would offer?

 

[GraemeL]

I suppose so, yes.

 

[Ecowritingtablet]

i would prefer westurn union business. 1. remitter will normally pay about 10-15 usd as bank fee only. 2. receiver will always receive full payment, no other intermediary fee(I hate this, they ever take 35USD as intermediary fee from us)

 

[Daugela]

With Transferwise, you only pay 0.35% and £0.80 per transaction, so a really attractive proposition. They also do business accounts.

 

[hongfunclothing]

Hi, as a t-shirts factory in China, we do business with customers mainly by 3 payment methods, Usually for amount of money above 5,000USD, by Bank transfer to our company account, and money 1000-5000USD by Western union, below 1000USD by Paypal.
Bank transfer, Western union and Paypal is the most common payment methods in international trade , depends on your amount of payment, you can compare the handing fee and pick the best one

 

[Skogy Dropshipping]

I would also recommended Transferwise
OR if you have a Hong Kong HSBC account you can connect it with your UK HSBC Account to make a transfer inbetween completely for free (then a small fee from Hong kong to mainland china)

 

[Maple Sourcing]

My clients have used HiFX, TransferWise to send USD from UK and USA to China, both are good.

 

[Nathan Abbott]

Sending money to China should be easier. I often try to explain to clients that paying in Yuan and of course negotiating with suppliers is often better for them as its likely that they will get a better price per until as ultimately the Chinese company may need to covert the USD to CNY (usually via HK) thus they add an additional margin to account for this.