Monthly Archives

December 2015

B2B payments

By | Banking, Money transfer

The business to business payment is the latest flourishing trend observed among the businesses, especially on the international level. Many companies now prefer to pay directly to the companies they are dealing with, instead of carrying the transactions through any bank. This direct payment method is beneficial for both sides in many ways.

The Unconventional B2B Transaction

The transaction of money in today’s world happens for two reasons;

  • A customer pays some company for their product or services
  • A business pays some other business for their products or services

B2C or C2B

Business to Customer or Customer to Business payment scenario is the conventional payment scenario, where a customer pays money to a firm that just provided its services to the customer. This scenario of payment is pretty well understood and is the bedrock of modern commercialization.

B2B

In the 20th Century, companies decided that to achieve their sales target and to improve their productivity, the customer needs to be satisfied at all costs. Hence, the business became “Customer centric”. In order to satisfy the customers so that they would persist with them, companies had to adapt policies that would help them keep their customers in line. Later on, companies realized that to maximize their profits, it would be better if instead of molding their business around customers, they balanced it between customers and their own needs. Hence, the B2B payments or the Business to business payments were devised. Business-to-business (B2B) means a scenario where one business makes a profitable deal with another. This usually transpires when:

  • A corporate is collecting resources for their manufacturing process, let’s say, a food manufacturer acquiring sugar.
  • A corporate requires the facilities of another for functioning details, say, a food manufacturer paying an accountancy organization to review their capitals.

The general capacity B2B (Business-to-Business) transactions is considerably greater than the capacity of B2C transactions. The chief reason for this is that in a usual supply chain there will be numerous B2B dealings concerning sub modules or resources, and only one B2C transaction

In B2B payments, a written invoice is always a requirement, and the payment is done on the basis of credit provided by the supplier. In business to business payments, buyer pays the cost of payment and paper checks dominate the transaction.

Saving service charges

The banks charge their clients a certain amount of money in terms of service charges. The companies opting for B2B method save these charges, especially in Export to Europe. Also, in many cases, the companies save the percentage of money that the banks keep when making international transactions. B2B payments rule out the third party, the banks in most cases, which lessen the amount of money to be paid to the one doing the transaction of money, thus saving a considerable amount of money.

Increasing profit margin

Having saved the processing fees and other service charges, obviously the companies make more profit in case of Global b2b payments. This directly has an impact on the fiscal budget of the business. The transfer of money from one country to another involves currency exchange.  Huge amounts of money can include huge losses, due to the constantly fluctuating currency rates, when transferred through banks (like Bank Account in Italy), which can be avoided or at least limited to minimum when carrying out B2B payments.

Flourishing personal businesses

The B2B payments encourage personal businesses as they are not as costly as the bank transactions. Individuals can explore ways to deal with banks and other monetary agencies in lieu with their own benefits; looking for the best bargain they have to offer. One can always find a bargain to avoid unnecessary expenses when dealing with other businesses and making B2B payments.

Ethical aspects

The security issues might be a reason for businesses when making B2B payments. But in long term businesses, they actually serve as a strengthening factor between the companies doing business with each other. The trust that they develop over the period of time is not just a corporate matter but also has positive personal impacts on the individuals involved in the process. People tend to be friendlier, affectionate and open with each other.

 

 

SWIFT money transfer

By | Money transfer, Outsourcing: an original view

A Brief about Society for Worldwide Interbank Financial Telecommunication

The world has turned into a global village due to the advent in technology. Technology has made this world pretty small and compact, interaction between people far away geographically requires only a few keystrokes now. This global village-ness of the world has made it so comprehensive for people to get humongous things done from the comfort of their home. One of these activities is the transfer of money from one place, to a location that is hundreds of miles away.

One of the chief medium through which money is transferred from one place to another is SWIFT money Transfer. A SWIFT money transfer is a kind of global wire transmission that is an electronic way of transferring currency from one nation to another. SWIFT initiated in 1974, when seven worldwide banks fashioned the “Society for Worldwide Interbank Financial Telecommunication (SWIFT)”. The money can be transferred and can be received by the receiver’s account in as short as a few minutes, but due to some unforeseen circumstances, it can also take up to about a few days. The transmission appears to be like a piece of paper with data in print, for instance the sending bank’s info, the entities tangled in the transmission and a sequence of codes that define how the money will be received. SWIFT money transfers permit money to be directed to far-off nations further quickly than by mail or courier facilities. They similarly offer receivers with an assurance that they will take delivery of funds as payment and that the money received is what was arranged upon throughout the deal.

Charges of $30 usually are obligatory to initiate SWIFT transmissions and there are related fees to accept one. Moreover, SWIFT transfers are also used by perpetrators of scam who bid that money be wired to them for scamming the people obviously. Customers must be wary if they are requested by an unfamiliar individual to wire cash out of the country.

SEPA payments

Within Europe SEPA payments are the norm. These are a lot cheaper, most often even free.

 

Money transfer to India

By | Banking, Money transfer

How to Send Money Back Home without Much Ado

India is situated in the heart of Asia. It is known for its cultural diversification, its history, its monuments and what not. However, India also has the third largest population in the world. According to the census of 2003, the population of India is nearly 1.3 Billion people. It would not be much of a problem had all its occupants were living on a satisfactory income, but unfortunately, they are not. Almost 80% of Indian people live below the line of poverty. In this regard, most Indians strive to grow up and move abroad for earning money. This strategy of the people of India has brought fruitful results to the country because firstly, it has outsourced a lot of people which has decreased the population boom. And secondly, because when these people send money from abroad, part of it also assimilates in the national wealth of the country.

There are a lot of methods via which overseas Indians send money back to their relatives in India; some of these are Greenwich Money Exchange, Western Union Money Transfer, and Remit2India etc. But the most famous of these options is Continental Exchange Solutions. It is a huge conglomerate, whose division for India is called “Ria Financial Services”.

This assists millions of overseas Indians in their quest of money transfer to India.

Sending Money

Continental Exchange Solutions allow customers to send money from wherever in the world to India via a debit card or a credit card, whichever suits your needs. You can also go to one of the millions of branches of Continental Exchange solutions personally and handover cash to them to transfer it to a particular city in India.

Receiving Money

Receiving the money sent via Continental Exchange Solutions is as easy as 123. There are two options for your recipient in collecting the money. He or She can either transfer the money received directly to his bank account, or the money can be collected personally through the 44000 branches of Continental Exchange Solutions throughout India.

Variety Of Ways To Export Money To Germany

By | Outsourcing: an original view

There are various ways to export money to Germany. When you are in trading business you have to face situations like having an issue in getting a bank account in foreign land, approving of other party’s default condition and opponent’s reliability. Banks have their subsidiaries in different countries and have smooth relations with foreign banks to facilitate a trader and businessman with money transfer, and global b2b payments.

Ways to transfer

Open account: in this type of money export, goods and services are delivered before the payment is made. Export working capital financing, government guaranteed export working capital programs, export credit insurance and export factoring are few techniques of trade financing. These techniques are helpful in mitigating the non-payment risk.

Documentary collection: sender and receiver’s banks are involved in authorizing the money transfer. To export money to Germany, remitting bank that is exporter’s bank allows payment collection and sends all the necessary documents to collecting bank that is importer’s bank. So money exports through banks in this funds transfer technique. Documents are involved in it like document against payment, document against acceptance specifying the amount and time of payments. The drafts of such kind are reasonable as compared to get letter of credits.

Cash in advance: to avoid credit risk, being an exporter of money you must opt for cash in advance. In this payment is received before the goods are delivered or services are rendered. Wire transfer, credit card and payment by check are the three basic methods of cash in advance. Wire transfers is a trustworthy method of exporting money to Germany.

All the above types of money export to Germany are reliable and good, and equally good for Export to Europe. People exercise different techniques of each method to make sure that they get what they want. However, cash in advance is the type that attracts least buyers. Paying in advance invoke various questions about the credibility and reputation of the exporter.

Choose a wise method and technique of money export to Germany to make sure you don’t have to suffer a loss. Money matters are crucial and require great thoughts, skills, intelligence, experience and instincts to make a right decision.

B2B money transfer

By | Banking, Money transfer


Receiving money for shipments is not always straightforward for global exporters. Here we give an overview and tips about B2B money transfer. SWIFT transactions can be expensive (3-6%). SEPA payments are free, but only in Europe. Using a service such as B2B Pay can be a way to profit from SEPA.

B2B money transfer: an overview

Money transfer commonly states to one of the subsequent methods of payment systems, Electronic funds transfer, an umbrella term mostly used for bank card-based payments, Wire transfer, an international expedited bank-to-bank funds transfer, Money order, transfer by postal cheque, money gram or others.

The infrastructure that the money transfer is based on had to be made secure and reliable. For that companies use Linux based operating software with multi-level firewall protection and the transactions are encrypted using complex algorithms specifically designed for the purpose.

Business to business money transactions

Banks often charge a processing fee, which can be a flat fee, usually around 30 euro or 50 USD. What banks don’t tell you, there’s a percentage ranging anywhere from 3-6% on top of that, calculated from the mid-market price. Business to business (B2B) money transactions allows businesses to reduce costs, usually by a very major amount, and to simplify payments, because B2B transactions are direct and no banks are included in the middle of the process.

As the modern world has transformed into a universal community, businesses have also evolved internationally. Sending money is not confined to a physical cash dealing between two people because business organisation’s relations are not subjected to a local area or a demo graph anymore, hence the need for the B2B transactions emerged. B2B transactions are important, so that a business can extract the required output result from another business in form of raw materials or manufacturing logistical support.

B2B money transfer

Methods available for B2B transactions

Lately there’s been a rush in the online world including business to business payments. Lots of startups have launched platforms to create simpler business to business money transactions, several companies are grasping and using business to business payments as a method to cut costs and simplify payments, and countless organizations are using them as a way to reduce security risks related to paper checks such as hacked bank accounts, fake checks, or forged signatures.

Global B2B payments methods include Wire transfer, domestic and international ACH, Paper checks, prepaid debit cards and PayPal. Studies show that wire transfer, also known as the SWIFT and credit transfer is the most used method for B2B transactions nowadays. Within Europe SEPA payments are very common to make payments from one European bank account to another.

The new world’s fast track for sending money

In today’s world, people have gotten physically distant but are more connected socially, as the world has morphed into a global village. People have gone farther apart in pursuit of a better career or to support families, transferring money and funds was an issue of the modern day world, which had been resolved by money transfer services from anywhere around the world.

Understanding B2B money transfer

B2B money transfer is the transfer or exchange of any amount of money from one business enterprise to other on the basis of some product that is bought by one. This transfer of money is done through online banking nowadays and therefore requires certain methods to exchange money over the web. The methods used in B2B money transfer depend on the website or the organisation that decides which approach is more suitable.

In global transactions a B2B payment is most often initiated by the importer with their local bank. This means a wire transfer. Consequently the exporter bears the costs for the transaction.

Payment approaches followed

Different transfer and payment methods are available. Many of the firms choose to go for online debits or credit cards. Use of cheques is also done but is very rare outside of the United States, where these things are spelled checks and still used a lot. Usage of online debits or credit cards is the simplest one. While transferring money using online cards, you may be required to provide detailed information about the card, like the card number, name of the card holder, the expiration date on the card, and more. Once you are able to provide such information, the process of money transfer become very easy and quick. 

System of transactions

There are different transfer systems that are usually followed in B2B Money Transfer, these include SET (Secure Electronic Transactions), BBSePay etc. A new concept of ‘e-Invoice’ is also making its way in the B2B money transfer world.

This type of system involves two types of characters i.e. the creditor and the debtor.

  • the creditor transfers some amount of money online or over the internet
  • on the other hand the debtor is the one that will withdraw money from the bank once the creditor has transmitted it

There is an agreement that is made by the debtor with the respective bank that will receive the money from creditor.

Why I should go for online banking?

Online banking today is used vastly by an increasing number of organizations in their businesses as well as by people for their personal use. The reason for using this approach is its ease and simplicity. In the long run these organizations are in a need of a secure system for their exchange of money such that the money as well as the data regarding exchange is kept in a form which is accessible to the organizations involved only, keeping it secure from any third party or unauthorized accessibility.

Free of geographic limitations

B2B lets you enjoy exchange of money on the basis of the services offered between different buyers and sellers worldwide. The basic advantage of deciding to choose b2b online approaches of money transfer is also often the result of an objective of getting oneself free of the limitations faced due to geography.

More information

 

 

Global B2B Payments

By | Outsourcing: an original view

New Look on Global B2B Payments

Global B2B Payments refer to all money transactions or transfers occurring internationally from one business to another. A new trend in global B2B payments is to handle the transaction without the involvement of banks, cutting down the cost and time it takes to process payments.

Apart from fixed fees such as SWIFT charges (around 30$) the currency exchange rate is a huge factor in the costs, sometimes amounting even up to 6% on bigger transactions, costing the exporter 6000$ on a 100k$ payment.

Payment Methods

E-Payment System

This is a well-known method which requires the user to open up an account just like a bank account. These are available for small consumer oriented to Orbian for huge businesses. They charge five percent of the funds transferred by the companies. This b2b money transfer method works fairly well.

Wire Transfer

This method is known from very old times which include money transfers from bank account to bank account. SWIFT/BIC code is required in this case. Bank completes the procedure of transfer. It is considered a safe method but when you are making a huge transfer of money banks involved may charge a high processing fee.

Corporate Credit Cards

These are used by the huge business companies because credit cards are considered expensive. Companies are not much willing to hand over credit cards to their employees. Employees will not also use their personal credit cards for business purposes.

Check

Checks are still very common for payments in the US. For this mode of payment you must have a good relationship with the business you are dealing with. Otherwise it is not a good method for B2B transactions. Like if you are dealing with a company for the first time don’t use this mode of payment. Check is also not a good way of payment for online businesses.

Subsidiary company plus bank account

It’s possible to set up subsidiary companies in other jurisdictions. If you then open a bank account in that jurisdiction you have much more control over the money flow. It requires a big time and money investment in the legal setup and paperwork but this can definitely pay off if you are transmitting millions each year.

Virtual Bank Account

It’s possible to get a virtual bank account in another part of the world. Companies such as B2B Pay and Payoneer make it easy to do this. This can be huge time saver compared to setting up a full fledges subsidiary. It also gives you much better FX rates than normal wire transfers, especially with B2B Pay.

 

 

SEPA payments

SEPA payments

By | Banking

A Brief Overview of SEPA payments

SEPA payments are used by the countries within European Union (EU) as well as some other countries outside EU but to which Euro bank transfers are supported. SEPA stands for Single Euro Payments Area. It can be described as a system that is initiated in Europe. It is used to transfer euro money between different banks in Europe.  SEPA supports the transfer of Euro across the border and it is seen to transfer Euro within the area which is similar to the domestic transfer you do within your country.

How SEPA Based Banks Work?

If you are planning to exchange money from any bank which is based in SEPA jurisdiction then it can be said for sure that you will not bear any extra costs than the regular transfers that are done locally. For most businesses and individuals it is considered as a cost-free option.

This money is usually received to another EU IBAN account within two days or even less. The receiving bank may or may not charge receiving cost depending on the policies of the respective bank.

All SEPA countries use the IBAN numbering scheme.

Why should I prefer using SEPA based account?

  • Fast, Easy & Secure:

SEPA has made the money transfers very easy within the euro area. The money that is being transferred by the SEPA based bank accounts is very fast and very easy indeed. In addition to this, the transfer of money by SEPA is even more secure than the regular bank transfers. Improvement is observed in the money that is transferred by bank accounts when they stand their basis on SEPA.

  • Free of complicated steps for new account creation

Usually it is observed that SEPA provides more ease when you are living in any country within the euro area for short term or long term basis. You will not need to create new account there or go through critical or hectic steps for new account creation in a new country rather you can use your old account – the one from your home country.

Furthermore, if you are on a trip to any euro country then SEPA can be found very helpful in getting the required money from your home country. In addition to providing your required money from your home account it may also offer an array of other services.

The SEPA (Single Euro Payments Area) Initiative and Its Advantages

Europe is the second biggest continent on Earth; it roughly includes about 40 nations. These nations are highly industrially developed and so are its people. A few years back, a group of European heads of states sat together and decided to amalgamate these European countries into a single union, called, “European Union”. EU includes 35 countries, which means, not all countries in the continent of Europe are the member of this European Union.

Due to different policies of EU, most of the aspects within these countries have improved. One of these is travelling, now you need to be a member of EU and you can travel throughout the member nations without hesitation. Another aspect of this merger is the currency. The European Union has been successful in introducing a general currency that has united all the member nations on a single platform, known as “Euro”.

SEPA (Single Euro Payments Area) is an initiative by the European Union to transfer monetary funds from one bank account in a member nation to another without much ado. SEPA payments are rapidly becoming the norm for the common people of the member nations because it relieves them off all the hassle for currency conversion, tax issues and prostration to laws of different countries individually.

SEPA payments are a great example of how to reduce the annoyance that the customers encounter while banking. The institution of SEPA payments ought to escalate the concentration of rivalry among banks for clients from corner to corner of different borders within the member nations of EU. For customers and administrations SEPA means low-priced, extra resourceful and more rapid payment transmissions when transferring euros from one EU member to another.

The goal of this initiative is to advance the competence of cross-border outlays and turn the disjointed nationwide markets for euro payments into a solitary internal one. SEPA will permit consumers to make euro expenditures without cash to any person situated anyplace in the zone, by means of a sole bank account and a lone set of payment tools.

 

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