This article is contributed by Veem
Cross-border business payments help businesses grow faster and succeed in an increasingly complex global trade environment. There are several different ways to make payments across borders. Traditionally, this happens with the assistance of a bank, with little visibility into the process and high likelihood of markups or currency exchange differentials.
In the shipping industry, this traditional process causes confusion and further delays that businesses cannot afford.
Nowadays, making cross-border payments can be as easy as a click of a button, with all the information instantaneously available, transparent and easy to understand. Businesses that take advantage of digital cross-border payments open up their organization to better customer service and fewer barriers and delays standing in the way of their business growth.
Here’s a quick primer on cross-border payments and the benefits of being able to facilitate them smoothly.
What are cross-border payments?
Cross-border payments occur anytime two entities need to transact from different countries (or across borders). Traditionally, this process has been complicated, complex, and headache-inducing.
For example, if one company based out of Germany needs to transact with a company based out of the United States, they both must pay fees to a bank and pay the differential during currency exchange. Some of the more costly variables include taxes and credit card percentage fees.
Additionally, this process is subject to regulations from both countries and can take a matter of weeks to authorize in the worst of cases. Many organizations have whole departments dedicated to seeing this process through, resulting in a huge amount of overhead to the company.
Needless to say, the traditional means of authorizing cross-border payments is cumbersome and restrictive.
But cross-border payments don’t need to be complicated or expensive. Today, by utilizing a digital platform, businesses can reduce their operational costs and even grow their revenue by reaching new markets in countries previously inaccessible.
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Benefits of paying a business cross border
Demand for cross-border payments—both in a B2B and a B2C setting—has increased dramatically even in the last ten years alone. No longer are cross-border payments the domain of only large corporations—small businesses are increasingly gaining market share and competing more effectively because they are able to access this time- and cost-savings tool.
Remaining flexible is an integral part of any business’ success. Especially when your client is another business, or a small-to-medium business (SMB), seamless operations help both parties succeed. Retention is higher and customer service rates soar.
The growing need for B2B cross-border payments
Retaining B2B customers is a key strategy employed by many businesses, no matter their size. Because there are many lucrative opportunities available in the B2B space, businesses create models to service those market segments specifically.
But for a strategy to be successful in the B2B space, it needs to account for international expansion and the ability to facilitate easy, transparent and less costly alternatives than competitors. To succeed, businesses must remain flexible and adapt to changing conditions, which is especially important in today’s global economy and trade environment.
SMB cross-border payments
One of the biggest expenses for every company—especially those that fall into the SMB category—is labor. Management of cross-border payments often translates into increased labor expenses. But, in fact, digital cross-border payment platforms can decrease labor costs to a company instead.
For example, if your company spends less of its time monitoring transactions for fraud and error, it may not need to hire additional headcount to bolster these processes. Instead, much of this overhead is made irrelevant due to the digitization of data and computer processing accuracy. And this doesn’t even begin to account for the lower cost of labor in hiring cross-border workers and being able to pay them efficiently!
Capitalize on cross-border business payments
Cross-border business payments are essential in expanding an organization’s network of suppliers, workers and consumers. They open up doors previously barred and break through barriers that inhibit growth and success.
It all starts with a reliable cross-border payment provider and a platform that enables businesses to move money around the globe with as few barriers and as much oversight as possible. A great cross-border business payment platform will also do everything possible to provide a safe and secure experience. Compliance with regulations internationally is a headache, but it pales in comparison to a data breach or fraud!
Automation and the move to the digital sphere have given rise to a plethora of options for every business. The right payments partner helps businesses build the solid foundation they need for reliable cross-border payments, unlocking all the benefits and capabilities that come with global transfer of funds.
This article was contributed by Veem
Who is Veem?
Veem empowers small and mid-size businesses with financial tools to simplify and grow their business. For almost a decade, Veem is trusted by more than 400,000 businesses in over 110 counties to send and receive money globally. Veem offers secure accounts payable and receivable solutions with tracking and seamless integration. Veem is licensed and regulated in each country and state it serves.
Veem is partnered with Freightos.com to provide an easy all-in-one solution for businesses looking to book and pay for cross-border shipping with Freightos.com.
Visit Veem for more information.
* This blog provides general information and discussion about global business payments and related subjects. The content provided in this blog (“Content”), should not be construed as and is not intended to constitute financial, legal or tax advice. You should seek the advice of professionals prior to acting upon any information contained in the Content. All Content is provided strictly “as is” and we make no warranty or representation of any kind regarding the Content.
