International business payments: Choosing payment methods and optimizing costs

Weigh up payment methods, consider forex pricing models, and learn how we price our currencies.

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May 13, 2024
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International business payments: Choosing payment methods and optimizing costs

When you're looking to make or accept international business payments, there's a whole lot at stake. Not only do you need to be aware of taxes and regulations in the countries you're looking to transact with, but there's the cost of foreign exchange itself.

For those reasons, a healthy awareness of trends and challenges in global commerce can only help. But, more than that, you need a good grip on the financial factors at play.

Whether you're providing international payment services, you need a way to manage multinational business expenses, or you're simply selling your goods and services overseas, this guide is a good starting point.

Firstly, we'll describe some of the ways you can make and receive international payments. Then, we’ll outline best practices for optimizing your global payments. And finally, we'll explain how you can get the right pricing model for your business.

Understanding international business payments

International business payments are financial transactions that take place between businesses in different countries. 

This could be for several reasons: purchasing goods and services, paying an international invoice, making card payouts, as well as a range of other cross-border economic activities.

Because international business payments typically involve more than one currency, they’re slightly more complicated than domestic business payments, and transactions tend to involve more parties. For example, a business in Germany paying a US-based supplier will pay in their local currency – euros – while the supplier will need to receive the payment in US dollars.

For this reason, international business payments qualify as foreign exchange (FX) payments, because one currency is transmuted into another during the transaction. Here, intermediary banks are often employed to act as ‘middlemen’: bridging the international gap between the two financial institutions involved, and translating the different languages of the transaction into a common dialect that both sides can understand.

Learn more: Multi-currency payments: benefits and use cases

Choosing payment methods for international business payments

When different currencies are involved – not to mention banking systems, regulations, and time zones from multiple countries – global payment processing can get complicated.

As you weigh up various payment methods, you should consider the following factors:

  • Convenience: Consider how easy or difficult it is for your customers to pay this way, and whether it's a familiar payment method
  • Cost: Ensure you factor in all the processing costs and fees, as well as currency exchange costs
  • Settlement: Some of these methods ensure funds are settled to your accounts sooner than others, so consider the impact of payment delays

International payment gateway

Imagine you run an online store in New York, selling products to customers from around the world. To be able to accept international payments, you’d integrate an international payment gateway into your website or app. This is the technology – often in the form of an API – which securely transmits the payment request to a financial processing partner.

That means when a customer from Sydney makes a purchase, your payment gateway will securely authenticate, verify, and process the transaction. Your customer will be able to pay using credit or debit cards (more on those, below) or any alternative payment methods you have connected to your website or app. The payment gateway also handles currency conversion, encryption, and deduction of fees for other parties in the transaction life cycle (such as the card schemes). Just remember to add on necessary taxes for any international sales. acts as a payment gateway, as well as a payment processor and acquirer. Our end-to-end solution helps your business accept international transactions online while remaining compliant with laws, regulations, and financial mandates.

Credit card

Credit cards remain one of the most popular ways to pay in the US, and they’re an important way of making and accepting cross-border transactions.

To accept credit cards from international businesses, you’ll need to join forces with a reputable payment service provider – like – to enable this infrastructure. Once you’re set up, you’ll be able to accept payments from international credit cards online, over the phone, or from the countertop of your brick-and-mortar store. You could even use convenient payment links to facilitate easy transactions.

Credit cards have the major benefit of being ubiquitous, as well as universally accepted and understood. Some drawbacks, however, are the interchange fees you’ll pay to accept credit cards, and the stringent data handling processes imposed by the Payment Card Industry (PCI).

We can help you to learn more about both credit card processing and your PCI compliance obligations as a card-accepting merchant through our guides and helpful sales team.

International wire transfer

Also known as a remittance transfer, international wire transfers are a form of EFT (Electronic Funds Transfer) payment that allows your business to send money directly from your bank to that of a business in another country.

You simply have to let your bank know how much you want to send, who you’re sending it to, and the SWIFT (Society for Worldwide Interbank Financial Telecommunication) or BIC (Bank Identifier Code) number of the recipient’s bank.

International wire transfers can often be settled on the same day you send them; and can even be immediate. However, wire transfers tend to be more expensive than some other forms of international business payment (such as ACH).

Compared to ACH payments, wire transfers are typically used more for larger, one-time transactions, rather than regular, continual payments (such as wages). 

ACH (Automated Clearing House)

ACH payments are a way of making and receiving cross-border payments to and from other businesses.

Unlike wire transfers – which are initiated by the sender of the international business payment – ACH transactions can be initiated by both parties, either as:

  • A ‘push’ payment, where the sender initiates the funds by ‘pushing’ the money into the recipient’s account.
  • A ‘pull’ payment, where the recipient, with prior authorization, ‘pulls’ the funds they’re owed from the payer’s account.

Check out our in-depth article on push payments vs pull payments to learn more.

Given ACH’s ability to enable both customer-initiated and merchant-initiated transactions (MITs), it’s ideal if your business model relies on you providing an ongoing subscription service (such as SaaS, or Software-as-a-Service) to your international customers, and need to be able to process regular recurring payments.

The ACH network processes transactions in batches, which makes them highly cost-effective. It also means ACH payments are better for processing smaller, recurring international business payments – rather than larger, one-off amounts, which are better suited to wire transfers.

For a full breakdown of the ACH vs wire transfer debate, our guide provides the big picture.

International money orders

International money orders are available from financial institutions – including post offices and banks – and can be used to pay businesses in countries around the world.

To pay a business in Mumbai, for instance, you could head to your local post office in Toronto and purchase a money order for a specific amount.

You’ll need to provide the cashier with the name and address of the recipient, as well as information about the destination country and currency. The money order is then sent through to the recipient in India, who simply cashes it at their local post office for the full amount (payable in their local currency).

International money orders are a reliable – if not a particularly scalable – way of paying a business overseas. They’re secure, and offer a paper trail; however, fees are generally involved, and international money orders tend to take longer to process than digital methods.

Letters of credit

A letter of credit is a financial document – issued by a bank on behalf of the buyer – that promises to pay you, as the seller, a specified amount of money. 

Essentially, a letter of credit acts as a guarantee of payment: providing security to both the buyer and seller in an international transaction.

Let’s say, for instance, that you’re a wholesaler in Chicago, importing goods from a manufacturer in Shanghai. To ensure the transaction proceeds smoothly, you request a letter of credit from your bank. The bank then issues the document to assure the manufacturer you’re working with that, once they fulfill the pre-agreed conditions – which, in this example, is delivering the goods – you’ll make the payment.

Letters of credit are particularly useful as a safety net for larger transactions. However, they also involved detailed paperwork. And, due to the bank fees involved and the need for both parties to comply with international regulations, can be both costly and time-consuming.

Cryptocurrency payments

Based on blockchain technology and secured with cryptography, cryptocurrency payments are faster than traditional international business payment methods.

Unlike traditional, government-issued currencies (such as the US dollar or British pound), cryptocurrencies are decentralized. The idea is that no central bank from one nation would control or regulate the currency. That makes them globally traded currencies, thereby eliminating cross-border exchange fees.

That said, cryptocurrency payments are not suitable for every business, and they're even banned in several countries. You should carefully check the local regulations of the country you are planning to make international payments to or from, to see whether or not cryptocurrency payments are permitted.

Best practices for global business payments

International business payments have big benefits – whichever side of them you’re on.

However, managing your global business payments involves careful planning, attention to detail, and a range of other best practices to ensure the security, efficiency, and compliance of your cross-border payouts.

We’ve listed a handful of these best practices for international business payments below:

  • Understand and stay abreast of local and international regulations, tax laws, and compliance requirements in your home country – and in all those you do business in.
  • Consider the stability of foreign currencies before deciding on a payment method. This will help you mitigate the impact of exchange rate shifts on your business’s bottom line.
  • Provide a wide range of international business payment methods (scroll up for a reminder!) to accommodate various customer preferences and reduce risk.
  • Work with a reliable, reputable payment service provider to help you accept international payments, and develop a comprehensive global payments strategy.
  • Invest in robust cybersecurity measures to secure sensitive payment data from threats and breaches; or ensure your payment service provider has fraud detection in place.
  • Maintain open lines of communication with your international customers and suppliers: clearly outlining payment terms, delivery schedules, and penalties for non-compliance.
  • Regularly review – and refine – your international business payment processes; responding to client feedback, changing regulations, and evolving market conditions.

Not sure how to choose the right company to process your international business payments? Our guide to selecting the right payment service provider for global expansion will help.

Benefits of international payment processing with Checkout

When weighing up an international payment solution, you should pay close attention to the fees you’ll be charged. Below we’ll outline how we offer competitive foreign transaction rates.

More currencies than most

As an international payments solution provider, we’re dedicated to helping your business expand globally. We offer payment processing in 146 currencies.

FX rate fixed at the point of capture

You need to know exactly what you’ll be charged per transaction – and our international payment gateway ensures you will. In the interests of transparency and fairness, merchants that submit cross-border payments to us are guaranteed the rate we provide at the point of capture. Even if the rate fluctuates before settlement. The exact FX rate we used per international transaction is visible in your financial action report and in a direct API call.

Flexible pricing framework

We provide varied pricing frameworks to suit your particular business needs:

  • Low volatility and high liquidity in the market  (i.e., major currencies)
  • Medium volatility and liquidity in the market  (i.e., minor currencies)
  • High volatility and low liquidity in the market (i.e., exotic currencies)

This is more variation than other providers, who limit your pricing options. In addition, we can customize pricing per currency pair and payment product (e.g. Acquiring, Pay to Card) to suit individual use cases. This allows you to tailor your FX cost strategy with precision.

Live market rates

While some payment processors will charge stubbornly high foreign exchange rates based on obscure FX rate sources, our FX fees map directly to the live FX market rate. When your customers pay in foreign currencies, we will use the rate closest to what the market refers to as the interbank or benchmark rate. This gets you a fair deal based on how the market is performing at the exact moment of funds capture.  

Reputable and transparent FX provider
Some PSPs offer blended FX rates, obscuring how they calculate them in a foreign exchange transaction. aims for transparency and commits to use a market leader FX rate provider that can be easily used for comparison and reconciliation processes

Coming soon: Predictable profits on FX

We are working to enable our merchants to view and use FX rates ahead of capturing transactions to help them have predictable profits when selling in currencies that involve FX. Merchants will be able to use FX rates to price and apply markups for their own services, with the confidence of knowing in advance how much will settle you in a foreign currency transaction.

Explore international business payments with

When you're looking to optimize costs and maximize revenue, will demystify the process for you, ensuring you spend as little time as possible worrying about foreign exchange fees and regional regulations.

At, we can offer partnership with experts in performance, tech, industry, and payment regulations.

We process international business payments in 145+ currencies. And we’ll give you access to all the business payment methods your customers want to pay with most.

Our international coverage solution will help boost your acceptance rates. Get in touch to find out how to limit the foreign transaction costs your customers – and ultimately, your business – will pay.

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May 13, 2024 15:35
May 13, 2024 15:35