Opening a Business Account for International Payments

No matter what industry you operate in, your company needs financial management tools that meet its needs and facilitate growth. That’s why opening a business account for international payments should be a top priority for every business. With the flexibility to send and receive cross-border transactions, you can streamline your workflows and expand your operations globally.

What Are International Payments?

International payments are simply cross-border payments that are sent from one country to another. If you’re sending funds from the UK to Australia, for example, this is an international payment. Conversely, sending money intra-country is considered to be a domestic transfer.

As the world becomes more interconnected and digital tools bring us closer together, more businesses are operating on a global scale. In today’s climate, you don’t need to be a major conglomerate with offices in every continent to enjoy global success. In fact, even smaller firms and SMEs can achieve worldwide global success – providing they have access to the right financial tools and services.

How Do International Payments Work?

There are various cross-border payment systems that facilitate international transfers. Popular options include:

SEPA
SWIFT
TARGET2

These systems all operate slightly differently but, essentially, they enable funds to be moved from an account in one country to an account in a different jurisdiction. When making a SEPA Credit Transfer, for example, you can send funds throughout the EU as easily as making a domestic transfer.

Alternatively, SWIFT payments are available throughout 200 countries, which makes it possible to send and receive funds from almost anywhere in the world. While SWIFT transfers tend to take 1-4 days, they do ensure cross-border payments can be made worldwide.

Similarly, TARGET2 operates globally and facilitates transfers in Euros. Operated by the Eurosystem, TARGET2 is a real-time gross settlement system that’s best suited to high-value transfers.

Do You Need a Business Account for International Payments?

An international business account is designed for companies that want to access streamlined cross-border services. This means that you’ll be able to send and receive funds internationally from a single account, without the need to use multiple accounts to manage transfers to different jurisdictions.

While some standard, domestic business accounts may offer international payments, these may only provide access to a limited number of cross-border payment systems, and they may charge high fees for some international transfers and foreign exchanges.

In contrast, international business accounts tend to offer more attractive terms for companies that regularly send and receive cross-border payments. By opening a business account for international payments, you can, therefore, benefit from access to a wider range of international payment options, lower transaction fees and more competitive foreign exchange rates.

What To Look for from a Business Account for International Payments?

Before you apply for an international business account, it’s important to compare what different providers offer so that you can find the best account for your company. Depending on your operations and commercial goals, be sure to consider:

International Payment Systems

Any business accounts that’s geared towards international payments should offer access to SEPA, SWIFT and TARGET2 but it’s worth double-checking that these are accessible via your preferred account provider.

As SEPA, SWIFT and TARGET2 are used for different purposes, depending on how much money you’re transferring and where the sender and recipient are located, it’s beneficial to have access to a range of cross-border payment systems from a single international account.

Fees and Charges

There are fees associated with both domestic and international business accounts but the fees applicable to cross-border transactions are typically lower when you’re using a dedicated international business account. Despite this, some account providers charge higher fees than others, so compare like-for-like accounts before deciding which account is right for your business.

Multiple Currencies

Choosing a multicurrency international business account means you’ll be able to hold, send and receive funds in more than one currency. This means you won’t have to exchange currencies before sending a transfer or after receiving cross-border funds. As well as being more convenient, this also means that you can avoid any charges associated with foreign exchange and/or choose to exchange funds at a time when the exchange rate is most competitive.

Online Functionality

Managing your company’s business account online gives you the flexibility to stay in control of company funds at all times, so you’ll certainly want to select an account provider that offers online banking services.

However, not all online banking services are as comprehensive or user-friendly as their counterparts, so double-check what features are available and view screenshots or sample a demo account to find out how user-friendly the online portal really is.

Customer Service

Although you may do the majority of your business banking online, it’s vital to have access to swift and effective customer service when you need it. Due to this, it’s well worth comparing banks or e-money institutions to find an account provider that can offer the customer service you deserve.

Debit Cards

If you want to maximise the functionality of your business account for international payments, select an account that enables you to use virtual and/or physical cards. This makes it easy to issue cards to trusted personnel and streamlines expenses management to increase in-house efficiency.

4 Steps to Opening a Business Account for International Payments

Once you’ve done your research and decided which account if right for your business, you’ll want to get started on the application process. To get your account up and running quickly, follow these four simple steps:

1. Check Your Company’s Eligibility

Different banks and e-money institutions have varying eligibility criteria, so it’s vital to make sure that your company is eligible for your preferred account before you begin the application process. Not only will this save you time, but it will also give you an indication of what documentation you’re likely to need to complete your application.

2. Gather Relevant Information

When applying for a business account for international payments, you’ll need to submit a variety of information, such as:

Company and director contact details
Proof of identity (e.g. driver’s licence, passport, etc.)
Certificate of incorporation (if applicable)
Confirmation of tax status
Projected turnover

By gathering the relevant information in advance and ensuring you have digital copies of requisite documentation, you can streamline the application process and get your application approved more quickly.

3. Complete the Application

Now you know that your business is eligible for your preferred account, and you have all the information you need to hand, you’ll be able to complete the relevant application form. Fortunately, virtually all banks and all EMIs provide online application forms, so you can submit your details from any location and open your new business account for international payments without delay.

4. Start Using Your Account

Once your account has been processed and approved, you can begin using it right away. You’ll be issued with relevant account information, along with additional documentation, such as online login credentials and/or business account debit accounts, so don’t hesitate to start benefiting from the features your business account provides.