What Are the Benefits of Cross-Border Payments?
Globalization has created a growing demand for more goods and services from all over the world. Business, in particular, has never been so global. In fact, the majority of businesses now hire international employees in at least some capacity. And many more sell to international customers.
Among other things, cross-border payments help small businesses both directly and indirectly:
- Significant operational savings
- Improved ROI
- Reduced need for physical office space
- Better payment security
- A larger talent pool
- Broader audience
- Improved profits
What Are the Steps Needed for Making a Cross-Border Payment?
As promised, here are the various steps a small business must take to ensure that they are sending international payments correctly:
Get the Right Platform for Your Employees
Different countries have different regulations and different platforms for sending and accepting payments. China, for instance, mainly uses WeChat and AliPay, two platforms mostly unheard of in the United States.
Find out what the most common platforms are for the area in which you’re hiring and make sure you offer those as options.
Navigate the Currency Issue
Make sure that any payment you send can be accepted or easily transferred to the local currency. You don’t want your employees to have a major hassle each time they’re paid.
Familiarize Yourself with SWIFT and CHIPS
These are nearly universal international regulations for sending and receiving cross-border payments. They roughly achieve the same thing.
SWIFT codes are created and maintained by the Society for Worldwide Interbank Financial Telecommunication, or SWIFT. These identify the country and bank of the person receiving payment and help ensure that the money is received promptly and securely.
CHIPS, on the other hand, does the same thing for the sender of the money.
Reduce Your Fees
Payment fees are a major pain. Even small fees add up quickly and dig into your ROI. Traditional banks created payment fees because they used to hold a monopoly on the payment market.
With the rise of more digital payments, digital currencies, and other forms of secure instant payment, non-traditional financial institutions have emerged in droves. Many of these institutions offer far more favorable payment fees for a small business account.
Ensuring full compliance is even more important when sending international payment. You need to make sure you’re following the laws of both your own country and the country to which you’re sending the payment.
And many countries are taking more and more steps to protect workers and consumers. Europe’s GDPR is the most prominent example and a good indicator of where many countries are likely to gravitate.
Make sure you find a payment platform that maintains full compliance in the country to which you’re sending the money.
What Are the Steps for Accepting a Cross-Border Payment?
Retailers who sell to an international audience also need to make sure they’re well-suited for accepting cross-border payments. Below are some important things to keep in mind:
Optimize Your eCommerce Page
No one likes a tedious checkout process. Make sure your eCommerce store has a smooth checkout page that is seamless for all currencies in the countries you sell to.
Track Routing and Processing
Make that your store is set up to receive all payments made from any country in which you do business.
Stay Compliant Here, Too
Compliance is also important when it comes to payments, whether you’re on the sending or receiving end. Follow all laws in your own country and, again, all laws in each country to which you sell.
Settle and Track
Ensure the prompt delivery of all payments by settling and tracking. Treat cross-border payments the same as any other type of payment to ensure that you can receive the revenue of each of your sales.
It Starts With the Right POS System
To ensure that you can accept all cross-border payments, you’ll need to work with the right retail POS and credit card processing. KORONA POS integrates with all major credit card processors. This allows our users to always find the best solution for their business, no matter where they’re selling.
For more info, sign up for a free trial below, and we’ll walk you through how to ensure a seamless process of sending and accepting cross-border payments.