How to Utilize Money Transfer Providers to Make Business Payments

pexels photo 164652

pexels photo 164652

Estimated reading time: 4 mins

Money transfers are a huge deal for your business, especially when you need to send payments abroad. Not only do you need to ensure that they are secure, but also that the payment arrives fast and that the transfer itself doesn’t cost you a small fortune. Sadly, bank transfers won’t provide you with any of this bar the security of your funds. However, even that advantage is often outweighed by the low-quality service. Money transfer companies are taking the spotlight in the world of international financial transactions today due to being more efficient, affordable, and easy to use overall.

Disadvantages of Bank Money Transfers: Cost, Rigidity, Time

There is no arguing the fact that bank transfers are highly secure. However, that security comes at a cost, and it’s the cost that is the main disadvantage of using banks for business money transfers.

Bank money transfer fees are high because the cost of the bank operation is extremely high. As any business, a bank has to turn a profit, which means that it has no choice but to charge large fees for every service.

As money issues are the second most common reason for small business failure (CB Insights), you have to look for ways to cut the money transfer costs. This matter becomes more pressing when you need to deal with high-volume international transfers, which can cost exorbitant amounts in fees.

One also shouldn’t forget that there are other issues associated with bank money transfers. The duration of the transaction is a major concern considering how fast-paced the modern business world is. International transfers can take up to 5-7 days in some situations, which might lead to unacceptable delays when dealing with both suppliers and customers.

Another downside of transferring money abroad via banks is the rigidity of their regulations. There are multiple formalities involved in the procedure and you often need to prepare a lot of paperwork for the transaction. And if you need to be present in the bank in person, you might often encounter less than friendly service. In fact, going to a bank is often a stressful experience.

Are Money Transfer Companies Any Better? Why?

Money transfer companies operate very differently from banks. Therefore, you won’t face the same issues when sending money through them. To understand the minute differences and reasons behind them, you’ll need to study a comparison of one against the other. The most important distinction is that money transfer companies provide much cheaper services because of their lower operational costs overall.

For a small business, which works with foreign suppliers or sells its products overseas, saving 1% on each FX margin can make a huge difference. Money transfer companies allow you to do exactly that, thus increasing the total profitability of your business.

The main benefits of using money transfer companies include, but aren’t limited to:

Banks Vs. Money Transfer Companies: Best Choice for Business

Your business definitely must have a bank account in order to operate and using bank transfers on occasion will be a good choice. However, in many cases, you can save a lot of money and stress by using money transfer companies instead. They are faster, cheaper, easier to use, and secure.

Choose a company with a high user rating and good reputation, as well as one that is both certified and able to provide proof of its digital security.

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