IN an increasingly globalised world, it’s common for businesses to make regular foreign transactions to countries outside of the UK. It may be that you’re paying suppliers who are based abroad, for example, or perhaps you’re making payments to a contractor who freelances with your business but is based somewhere outside Great Britain.
The good news is that what you’re doing is likely to be helping make your business sustainable and more profitable in the long term, as international companies are often resilient and have bright futures ahead of them. But the less good news is that there are several traps that it’s all too easy to fall into if you’re making business transactions in a foreign nation. Here’s some information on what those traps look like – and how you can, hopefully, avoid them.
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Exchange rate fluctuations
The exchange rate between the two currencies you work with will be unpredictable and variable. It can vary based on everything from interest rate change announcements to macroeconomic data releases, and there’s no sure-fire way of knowing when the best time is to convert it. However, all of this is little comfort to those who need to make a transaction urgently, thereby running the risk of wiping out profits made once the money is converted from the foreign currency back into sterling. One option is to set up a bank account in the foreign country and leave the money there until a later date, but that’s not necessarily an option for many firms.
Forex account management services, and especially those that come recommended from a trusted site like Forex Fraud, can provide the sort of expertise that helps you get your business-to-business transactions over the line in a way that makes you less vulnerable to problems like these. They can, for example, often provide what are known as “hedging” products – services that control your exposure so that you can limit your loss even if the exchange rate turns against you.
Finding the right provider
When making a business-to-business foreign exchange transaction, you’ll need to make sure you pick a provider that suits your needs. In some instances, this will be a provider that can also offer forex account management services. In others, it might simply be a remittances provider who performs the actual transfer. Either way, what matters is that the service offers a fee that is cost-effective enough not to affect your business – and which gives you peace of mind when it comes to security and speed.
Language barriers
Language barriers are also a potential issue. If you’re sending money to a country that also speaks the language in which your business operates, of course, this wouldn’t be a problem. But most countries are likely to speak other languages – and it’s here that a skilled translator, or at least a multilingual money transfer service, can help. These services can help prevent expensive linguistic mistakes, such as sending money to the wrong recipient, from being made.
Scam risks
Finally, it’s also worth bearing in mind that it’s eminently possible for your international B2B financial transaction to be at risk of a scam. It’s not necessarily any more or less likely than if you were operating in just the UK, but it’s true to say that sending money online brings with it its own set of risks.
In a domestic transaction, you’ll likely be familiar with both the sending and receiving infrastructures. They may be two banks you know well, for example, or two money transfer websites with URLs you regularly visit. When the international equation is brought in, however, the picture changes somewhat. You may find, for example, that you’re unfamiliar with the provider at the international end of the process and don’t have the tools to assess whether their site is legitimate. For that reason, it’s always worth trying to use a professional to help you make your online money transfer if you possibly can.
International B2B transactions, then, can appear fraught with difficulties. Whether it’s the risk of the exchange rate going against you or the possibility of a scam taking place, there’s a lot to consider. However, by following the advice outlined in this article, it’s possible to defend yourself against most of these problems and raise the chances that your business-to-business online money transfer goes as smoothly as it possibly can.
