In a corporate landscape where the world is ever increasingly accessible through technology, there is no longer a physical limit to where we may conduct our business. Overseas suppliers and customers are common place and bring with them a raft of new challenges, both fiscal and regulatory. Therefore it is important that businesses keep a finger on the global pulse to not only protect themselves but also make savings where possible.
Reduce foreign exchange costs and bank charges on overseas activities.
If you are buying or selling materials, ingredients, components, products or equipment overseas then you will be involved in foreign exchange currency conversions of some kind. Regardless of the size of your company you will not be receiving the best level of service, expertise or rates from your bank.
This service is only available to the largest multi-national companies, governments or sizeable financial institutions. Many will use the big high street banks however, by using a specialist in the field your company can achieve this level of service and reduce costs and fees.
Currency Exchange and Payment Services
As experts in corporate foreign exchange our Partners are trained to listen to your requirements, understand your business and help you develop bespoke strategies to maximise your profits and make the most of money market movements.
Our Currency exchange and payment service offers you:
- A dedicated Personal Account Manager
- Improved exchange rates guaranteeing to save you money
- A fast and straightforward payment to the recipient
- Hedging tools to protect your business against currency fluctuation
- Up-to-the-minute market knowledge to help you make informed decisions
- A 24 hour monitoring service
- A 24 hour rate alert service
- Increase in business and profit margins
- A fast and straightforward payment to your suppliers
- An easy to set-up direct debit facility to speed up your regular transactions and save you time
Authorised, regulated and compliant. Your peace of mind and security
The payments we receive from our clients to purchase foreign currencies are kept in segregated accounts at either one of the following banks: Barclays, Royal Bank of Scotland or NatWest. These accounts are dedicated to hold clients’ funds and are totally separate from our business accounts.
The company is authorised and regulated by the Financial Services Authority (FSA) under the Payment Services Directive. In addition, we are committed to upholding and adhering to all the requirements of the 1993, 2003 and 2007 Money Laundering Regulations and other legislation.
Furthermore, we always observe the highest levels of care when dealing with our clients data and are fully compliant with the Data Protection Act 1998.
International HR Payments
Many businesses have staff overseas and need to ensure those people get paid, more often than not in local currency and a safe and timely fashion. Keeping those staff happy is as much about them getting their funds as anything else.
Some businesses have a few staff overseas and some have lots. Some are centralised in one place and some are dotted about around the globe. Whatever your situation your business has a choice of how to pay them.
Most companies use their online banking systems or their Banks to transmit the funds but both are costly and administratively fraught. If paying by online Banking the FX still has to be done. Banks will treat theses as individual trades and we all know that the smaller the trade the worse exchange rate you will get.
If a business gets the bank to do the transactions this cost will be even higher as they will not only charge you excessive exchange rates, sometimes as much as 5%, they will also charge you individual remittance charge. That itself can prove very costly over a period especially for those with more than a few staff. Add to this the administration of handling tens or hundreds of individual payments or exchange deals then this can be burdensome to staff time and costs.
The alternative is to use a different provider who can wrap the whole process up into one payment saving you:
- Transmission costs
- Exchange rate costs
- Potential staff costs
These savings are likely to be in tens of thousands of pounds per annum even for a small firm and certainly hundreds of thousands of pounds for larger companies.
How does this work?
A specialist provider will download your overseas staff details including Bank accounts, fixed currency or Sterling amounts and any other specific necessary details and your company can make one payment in Sterling to them and within one day all of the individual salary payments, in local currency will be delivered to the respective accounts*. You will receive a full breakdown by statement of the individuals’ sterling costs and currency paid.
To many businesses the handling of Foreign Exchange is an unnecessary administrative burden as well as being a costly one. This leads to many businesses taking the easy way out by letting the Bank handle these transactions at their will which, as pointed out previously on this site, will normally result in excessive costs via the exchange rate.
Quite often businesses and those within them that carry this administrative burden are unaware of the choices open to them. Not only in using other providers to soften the exchange rate costs but also in acknowledging there are other products out there for them which could have benefits in:
- Reducing to a minimum or even mitigating altogether the need for FX transactions
- Reducing the administration and potentially cutting admin costs
- Removing all FX transactional costs
- Creating advantages over your competitors
The Technical Bit
How can this be done?
Invoices are normally sent in the accounting and therefore local currency of a goods provider. This means UK importers will receive currency invoices and UK exporters will send Sterling invoices abroad. Either way there is a cost associated to the UK company either by having to buy currency from their Bank or for the cost of a UK companies product being more expensive due to associated FX costs from the receiver of those goods.
To alleviate all of these problems companies could use the services of an FX Invoice warehouse. The way this works is as follows.
A UK Company sells £100,000 worth of goods overseas in Europe and sends out an invoice to be paid in a certain time frame. All that company is worried about is that they receive £100,000 but of course the recipient of the invoice has the time and cost problem of FX.
In place of this the UK Company sends the invoice to an invoice warehouse and they would forward the invoice in the recipients’ local currency therefore negating their administration and in all likelihood reducing the cost to them. They transmit the euros to the warehouse company who forwards the sterling on to the UK Company. Bear in mind if the overseas company is using more than one UK Company they would much prefer to receive a Euro invoice as well as the unit price being cheaper therefore affording you a competitive advantage.
The opposite works for UK importers. On ordering goods from overseas you request the invoice to be sent to the Invoice warehouse company who on receipt will then forward the invoice to the UK company in Sterling so that company will have a clear idea of costs without having to factor in the Exchange rate costs and the banking charges. The payment is made to the invoice company who transmit the currency abroad. This will reduce costs, make importing cheaper and reduce internal administration. On top of this it is also possible to ensure you know your ultimate and complete Sterling costs prior to ordering which in turn will alleviate Exchange rate swings, hidden charges and surprise costs.