Receiving international payments

[Natavir]

My first post here so thank you for letting me join this forum.

I'm a small business in the UK and have a question about receiving payments from abroad, mostly from USA but potentially also from Europe and Australia.

My business operates a subscription kind of service so will be receiving regular, mostly monthly but also annual subscription payments from clients.

I've read through other posts to see what my options would be when it comes to international banking and some of you recommended Transferwise Borderless account which appear great but in an ideal scenario I would like an option for me to bill my clients monthly, transferwise don't offer that.

I've looked at PayPal, worldpay and stripe but they seem expensive and I don't know how much my US clients would be charged for paying into a GB bank account.

Is there another option out there?

If transferwise borderless is really the bees knees then I would like to know how much in reality it costs to convert and withdraw currencies into my UK bank account?

Any advice will be appreciated.

 

[Mr D]

Have you looked at currency accounts such as worldfirst?

 

[Nochexman]

...I don't know how much my US clients would be charged for paying into a GB bank account.

I don't understand this comment. What charge are you thinking of?Why would they be charged for paying into a GB bank account?

 

[Natavir]

I don't understand this comment. What charge are you thinking of?Why would they be charged for paying into a GB bank account?

When I use my visa debit card to pay for something in the US my bank charges me some fees, e.g when I pay $200 the fees and charges from my bank come to around £5.
I'm guessing this might be the case for US clients paying into an account in the UK.

 

[Natavir]

Have you looked at currency accounts such as worldfirst?

Yes I've looked at Worldfirst but could not find clear information about their fees, I don't like it when a provider doesn't list their pricing clearly.

 

[Mr D]

Probably because they don't know how much to charge you?



There is no fee to open or hold any account with WorldFirst.

The way WorldFirst operates as a business is to take a small profit from the difference between the rate that we buy your currency at and the rate that we sell that currency to you – this is known as a ‘spread’. For more information on spreads, talk to your Account Manager.

In addition, World Account customers might be charged a small fee for same currency payments – i.e. GBP to GBP. Again, your Account Manager can explain more.

WorldFirst Online customers may be charged a pre-agreed fee on international payments (ranging from £1 to £15) but this will be discussed with your Account Manager in advance.

That’s it. Simple and transparent money transfers for your business.

 

[Nochexman]

When I use my visa debit card to pay for something in the US my bank charges me some fees, e.g when I pay $200 the fees and charges from my bank come to around £5.
I'm guessing this might be the case for US clients paying into an account in the UK.

I'd check what you are paying with your bank. It may be they are charging you a surcharge for converting your GBP payment into UKD.

Your US customers will incur a conversion charge if they are paying in USD into GBP. To avoid this charge you could get yourself a USD account and receive these payments in USD. However, the charges for this service tend to be high unless you are doing a significant amount of business each month.

One of the things you need to consider is who do you want to pay for the conversion: if you use paypal, worldpay or Nochex, the customer pays for the conversion; other solutions will tend to charge you.

 

[Raw Rob]

Gocardless might be a solution, for reoccurring payments by direct debit. Very reasonable fees, they currently support the UK, Eurozone, Sweden and Australia. The USA is listed in the "Coming soon" section: https://gocardless.com/schemes/

 

[Ecowritingtablet]

https://www.veem.com/ any one use this one? one of our clients use it. it is free for him, and it takes about 3 days to arrive for international payment. And 20USD will be deducted from our side. I think it is good and fast as it save our clients a lot of bank fee.

 

[masterbee]

With Paypal, you would be charge instead of your clients for payment. Furthermore, Paypal policy for business account requires many complicated conditions and usually limits users. However, it's free

 

[HostXNow]

I would say PayPal is probably the easiest one.

US customer pays through Paypal and that's it for them. The charge for PayPal doing this would come from you as a fee. Like 3% of the transaction. You may double check that.

There are no doubt cheaper options than PayPal but I found PayPal "just works" and easier for everyone to use and so it is my preferred choice.

It depends how much total sales you will get each month/year too as some have lower fees the more sales you have each month/year.

It depends whether you use Express Checkout, Website Payments Standard or Website Payments Pro.

For Express Checkout & Website Payments Standard

No monthly fee
From 3.4% to as low as 1.9% + 20p per transaction

Or for Website Payments Pro I believe there is a fee of £20/month plus one of the following:

Merchant fee structures
There are 2 fee structures available for this solution:

Blended fee structure

The blended fee structure includes two components – a set percentage plus a fixed fee on each transaction. You’ll pay the same rate regardless of the card type used, with PayPal absorbing any fluctuations in the actual cost of performing the transaction. For example, you might be charged 3.4% + 20p for each transaction. You’ll receive the money in your PayPal account as soon as your customer makes the purchase, and that money is usually available immediately to withdraw to a bank account.

The Blended fee structure may be preferred if:

• Immediate availability of funds on all your transactions is important
• Predictable transaction costs are essential for planning
• Quick and simple reconciliation of PayPal and card sales is preferred

Interchange Plus fee structure

The Interchange Plus fee structure includes three components – interchange fees (set by MasterCard and Visa), a set percentage, plus a fixed fee on each transaction. Interchange Plus rates apply only to transactions in which your customer has paid you directly with a debit or credit card. Interchange fees may vary depending on the country of issuance, category and type of card used to make the payment. For example, you might be charged an interchange fee + 2.9% + 20p for each transaction. PayPal doesn’t know what the interchange fee is at the time of the transaction, and only receives interchange fee information from processors at the end of the business day. You’ll usually receive the money in your PayPal account the next business day after the payment has been made.

The Interchange Plus fee structure may be preferred if:

• The vast majority of your sales are from consumer card types in the UK or from within the European Economic Area where interchange fees are capped.
• Delay of one to two business days to the availability of your credit and debit card funds is acceptable.
• Differing settlement times between card sales and PayPal sales doesn’t impact reconciliation.

I hope that helps.

 

[Ray272]

Could depend on the cost per transaction. We use transferwise but that borderless bank accepting all currencies is not as straight forward as it sounds. Transferwise become the bank and your USD payments would be better off held in TW as opposed to transferred to a GBP or even a USD GBP based account.

We use TW for clients to transfer to our USD account. We are charged $9 per transaction but the value is irrelevant.