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Cost-effective International Payments

Updated: Nov 19, 2021

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International business payments: an overview

international payment overview

Implemented by thousands of banking partners and third-party financial organizations worldwide, relatively straightforward and habitually rather speedy, international wire transfer is undoubtedly the most common and widely used type of money transfer available today. What happens when proceeding with a payment? What further costs can one expect? How long exactly does the entire process take? To better answer these questions, in this article we will be delving a little deeper into the different aspects of wire transfers and some of the swifter more recent alternatives to sometimes lengthy bank-to-bank payments.

What is an international wire transfer?

Set aside the nitty-gritty of the technical inner workings of it, simply put, let's just say that wire transfers are merely messages sent from a debtor's bank (issuer) to the creditor's (beneficiary). To facilitate said international transactions between banks, countless reputable establishments have transitioned from paper money to digitalized e-banking, an online money management platform owned and powered by the banks themselves. Whether through a dedicated app or a dedicated website interface, one can consult their savings and execute payment orders, both nationwide and globally.

international wire transfer


To send money internationally (outside the euro area), the beneficiary's details, account number, and BIC or SWIFT code must be filled in the appropriate blanks:

When wire transferring money internationally (within the euro area) using euros, the recipient's details and account number must be typed in:


  • Contraction of Single Euro Payments Area, SEPA is a European initiative aimed at facilitating Euro-based (€) transfers for the 36 cosignatory countries affiliated to it. Thanks to it, transnational payments are no different than national ones.

Both SWIFT and SEPA are secure ways to issue payment orders internationally. However, whereas transfers with the former are rather tardy and generate high costs, with SEPA, usually no costs are expected.

How do international business payments work?

how international payment works

For the sake of argument only, let's say you (the debtor) live in Walles. Through your e-banking platform, you issue a payment order of a value of 2’500£ to be transferred to an American recipient. Given that The United States of America is outside SEPA, the corresponding 2’500-pound SWIFT order is sent off to the beneficiary's local bank. Upon reception, the converted sum in American dollars and all possible adjoining transfer fees are withdrawn from your savings and credited to the payee's account. It is worth noting that several days might sometimes be necessary for the transaction to be complete.

Cost of international payments

As a general rule, when it comes to international SWIFT wire transfers, not only do exchange rates apply but banks ordinarily charge different commissions as well, ranging from fixed minimal transfer fees to additional variable fees, dependent upon the total amount transferred.

Expected fees for international business payments

fees for international business payments

We have seen that SEPA payments are usually free of charge. The same cannot be said of SWIFT transfers, however, as briefly mentioned above, too. Yet, right before issuing your payment order, 3 options are at your disposal, namely:

1° OUR (as the sender): While the recipient is awaiting receipt of the entirety of the sum transferred, all extra costs incurred are to be paid by you.

2° BEN (BENeficiary) – Transfer and reception charges are to be paid by the beneficiary.

3° SHA (SHAred) – Default option. As stated in its name, all fees incurred are to be shared between the sender and the receiving party.

How fast are international business payments?

In comparison to SEPA international wire transfers taking roughly one business day to process, SWIFT payments are customarily noticeably slower, taking at best within one or two full business days to come through. However, different unfavorable factors, not all attributed to mere technical glitches, can be the cause of further slowdowns and delays: banks do not and will never process wire payments made on the weekends or public holidays nor past opening hours. Moreover, certain currencies are known to require longer processing times as well.

How to avoid excessive costs when sending money abroad?

Although extremely handy and made drastically simpler over the years, it should no longer come as a surprise that banks, more often than not when transferring money internationally, charge exorbitant prices - particularly with SWIFT wire payments. Commissions can very quickly pile up and escalate to hefty sums. It is not at all uncommon for them to charge by the dozen for payments of only a few hundred pounds in total, as an example.

avoid excessive costs

In response to this state of things, many Internet platforms catering to businesses and people in need of cheaper alternatives have emerged. Service providers such as Transferwise or Paypal have made a name for themselves for cutting down on some of these penalizing commissions. While banks still take their commissions, Transferwise, for example, with their reasonably moderate fees, and rapid processing time has helped people save up on otherwise pricey transfers.

Following this new cost-effective approach to international transfers, we, at Funding Routes, concerned with helping you get the best possible rates available, have concomitantly partnered up with the most money-saving, least time-consuming payment providers for your international wire transfers. We would be delighted to discuss it with you, so please do not hesitate to contact us to discuss the matter further! Further reading:

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