International Payments and Expenses – Part 1: What is the problem?

16 August

Jamie Allen

The world of international payments and expenses management has become much more of a focus area for businesses, as increasingly stringent regulatory requirements globally have made it more difficult to send and receive cash in an efficient and cost-effective way. Instability in global markets as a result of COVID and Brexit has also meant FX is a huge risk area for many businesses, and with import and logistics prices increasing, it is more important than ever that business owners maximise their margins wherever possible and reduce unnecessary costs to remain profitable.

When making international or cross-currency payments, most businesses will simply use their current account via their online banking platform. This means that you are using a rate that is supplied by your bank which is not only often less favourable than rates available on the market but also incurs additional bank charges. On a single payment in isolation, this may not seem like a huge issue, but over a longer period, this can add up to significant amounts of money simply being wasted for lack of shopping around for better/cheaper solutions. 

I was once working with a multi-national insurance company in the UK whom as a mid-sized business was spending the equivalent of a person’s salary on Bank Charges as a result of International Payments and Internal bank transfers between their own currency accounts. Some of this was down to poor cash flow management, but equally, it shows how, if you do not manage this area of your business, it can become a significant cost. With some focus, we were able to save the business over £15k on bank charges per annum with some slight process adjustments.

The other issue with international payments is the lack of control or oversight over the routing of the funds through the banking network. With a number of different banks involved in the routing of a single payment, it is not uncommon that funds can be held up, returned, or even seem to disappear into a banking black hole as funds are passed through intermediary banks. Queries from banks and chasing transactions can take a significant amount of time to resolve, causing delays in payments which can sometimes have severe business consequences.

In terms of business expenses, with international travel being less of a concern now, this issue might not be top of the agenda, but it is interesting to see the movements some companies have made in this area to increase the breadth of their service offering. These will be discussed more in the second part of this blog series. But in the same way that paying suppliers in different currencies is an issue, paying employees carries the same type of problems as mentioned above. Many businesses will also allow travelling employees to carry cash, which can be a real headache to monitor and reconcile. Not to mention this is also a key fraud risk area.

Look out for our next blog to see how we can help you save time and money in these areas of your business and if you have any questions in the meantime, don’t hesitate to get in touch at

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