Our "Learn More" series provides businesses with an introduction in subjects of foreign exchange and international payments.
✔Money transfers from bank account to bank account can be conveniently made online directly from a PC or mobile device. Physical cash can be wired through a bank or money transfer operator directly into a bank account. No need to use time-consuming and manually intensive cheques.
✔Foreign exchange can be integrated with the money transfer process – no need to keep accounts in multiple currencies.
✔Funds are delivered securely to international customers, often within the same day using the Reserve Bank of Australia’s, real-time gross settlement (RTGS) system or Direct Entry. Funds are consistently delivered to Australian customers on the day they are sent.
✔In 2017, Australia is set to launch its New Payments Platform (NPP) service allowing businesses, households and government agencies to make nearly instant payments on a 24/7 basis.
✔More widely accepted internationally than credit cards, especially by smaller businesses and individuals.
✔Potential for integration with invoicing, cash flow management and accounting software.
"It has never been so easy to make international money transfers. The days of having to send paper cheques, which took ages to reach their destination and then had to be processed by local banks, are gone.”
✔Have suppliers, employees or contractors in foreign countries who need to be paid in local currency.
✔Want to be able to accept payments in foreign currencies to make their business more attractive to international customers.
✔Want to establish new business relationships in foreign countries without having to set up accounts with local banks.
✔Want to have full control over the timing of payments in order to manage cash flows efficiently or mitigate FX risk.
✔Need the certainty that urgent payments in AUD will settle within a few hours.
✔Want the peace of mind that comes from using a trusted intermediary for large and international payments.
“Notably, for most businesses, the largest operating expense is that of their human capital, in the form of their payroll expense.”
✔Although money transfer operators can handle currency conversion, there may be no opportunity to lock in FX rates ahead of payment, so there may be unforeseen FX gains or losses.
✔Money transfers can incur fees for both the sender and the recipient.
✔International money transfers can arrive several days after they have been notified to the recipient. The exact period depends on the country and the receiving bank’s terms of business.
“SWIFT’s member banks will need to ensure not only that their software is secure, but their employees and partners are trustworthy. For in the end, systems are only as secure as the people who use them.”
With 17 years experience in the financial industry, Frances is a highly regarded writer and speaker on banking, finance and economics. She writes regularly for the Financial Times, Forbes and a range of financial industry publications. Her writing has featured in The Economist, the New York Times and the Wall Street Journal. She is a frequent commentator on TV, radio and online news media including the BBC and RT TV.