About 58% of businesses serve international customers. It’s never been easier for small businesses to enter new markets.
Cultural barriers, technological advances, and shipping make expanding into international markets simple. There are some challenges that go with it, though.
You have to handle more international money transfers. That can turn a new market into a money-losing venture.
There are common international money transfer mistakes that you can avoid. You just need to know what those mistakes are.
Read on to learn the top money transfer mistakes and tips for transferring money internationally.
1. Transferring Through Your Bank
It might seem like your bank is the most logical place to go to make an international money transfer. It’s likely to be the most expensive.
Banks aren’t usually set up to do money transfers. They consider them wire transfers, which come with a lot of fees. It could cost $50 in fees to wire $50 to another country.
That leaves you looking for the cheapest way transfer money overseas. Fortunately, you have a lot of online options to look at. Make sure you compare a few different money transfer providers before settling on one.
2. Using Your Credit Card
Most money transfer providers give you different options to initiate the transfer. You can do a direct transfer from your bank or use a debit/credit card.
If you’re in a hurry and can’t connect your bank account to the transfer provider, you might be tempted to use a credit card to finalize the transfer.
If you use a standard credit card, that counts as a cash withdrawal. The credit card company will charge between 1% and 5% for a withdrawal fee.
You’ll pay higher interest, too. That’s generally around 29%.
3. Not Verifying Payment Details
A simple typo can prevent your funds from reaching the right account. Always look over the bank information several times before you confirm the transfer.
Confirm the details you received and look over the payment details before hitting send.
4. Not Knowing Delivery Times
There may be bank holidays where you’re sending the money. The money transfer provider has its own timeline to send money.
Some send instantly, while others take several days. Be sure to consider all of these factors when transferring money internationally.
5. Ignoring Fees and Exchange Rates
Do you assume that if you’re transferring 100 American dollars to Europe, it’ll come across as 100 Euros? That’s not how money transfers work.
As of this writing, if you want to send 100 Euros to a business partner in Europe, it takes about 113 dollars to do it. That’s the current exchange rate.
The money transfer provider you choose charges money transfer fees on top of that. Take all of the transfer costs into consideration.
Don’t Make These International Money Transfer Mistakes
Business happens globally. If you really want to take advantage of a global market, you have to take into account money transfers and foreign exchange rates.
You can avoid these international money transfer mistakes. Calculate the true cost of money transfers and use the best money transfer provider.
For more money and lifestyle tips, be sure to come back to the blog often.