Global payments: 4 ways to improve your international transactions  

October 1, 2024

As international transactions become the norm for more and more businesses, streamlining cross-border payments to provide speed, visibility and cost-efficiency is becoming increasingly important.

In today’s globalized economy, cross-border payment capabilities are no longer nice to have –they’re imperative for increasing your company's reach and success. The World Economic Forum predicts that the value of cross-border payments will reach $250 trillion by 2027, a 60% increase in a decade.

“Companies are looking around the world for suppliers and services as well as new customer bases,” says Adam Towers, U.S. Bank vice president and group product manager of international solutions. “Making these transactions more efficient, cost-effective, and transparent is becoming increasingly important.”

But as organizations explore the opportunities of a global market and supply chain, they also encounter payment challenges. The right technology combined with global payment expertise can make all the difference, enabling your company to navigate a complex payment environment and find success.

Cross-border payment problems

Every opportunity often comes with challenges, and cross-border payments are no exception. Online marketplaces and increasingly globalized supply chains mean that international transactions are becoming the norm for many companies, even if they don’t have a customer base outside the U.S.

But the intricacies of doing so can stymie companies. For example, every country has its own rules and regulations to prevent fraud and protect client data. Failing to abide by these regulations can lead to fines, added fees, operational delays and more.

“The different regulatory frameworks require attention so that you don’t inadvertently make a misstep,” Towers says. But he notes that they’re just one piece of a complex payments puzzle. Organizations also need to manage fluctuating exchange rates, fees across the transaction lifecycle, and lengthy timelines that can make a simple transaction feel much more challenging than it should.

It's not uncommon, for instance, for companies to incur multiple charges as their payments reach the vendor. Sometimes, the fees mean the vendor doesn’t receive the full amount they’re owed. In addition, misunderstandings or mistakes regarding fees or rules can stall payments at various transaction stages, impacting supplier or customer relationships and creating cash flow challenges.

4 ways to improve cross-border payments

Though cross-border payments may have their challenges, you can streamline your international transactions by doing the following:

1. Establish a robust payments infrastructure.

It’s crucial for companies to have a reliable and secure payments infrastructure that supports efficient international transactions. This includes a combination of cross-border payments expertise and technology solutions that make it easy to pay vendors abroad and receive payments from international customers.

Businesses should prioritize the ability to access treasury management solutions online and easily integrate them with their other financial management or ERP systems. For example, U.S. Bank Global and International Payment Solutions provide a suite of cross-border payment tools, channels, and bank connectivity options, allowing you to find the best combination of solutions for your business—and then adapt your global payments capabilities are your company evolves.

2. Prioritize payment security.

Safety and security are a top priority for most organizations, as businesses want to protect their money — and their customers’ money. U.S. Bank Global and International Payments Solutions help companies safeguard their assets via ongoing transaction monitors to detect and prevent fraudulent transactions. In addition, the bank’s online solutions employ numerous security layers including multi-factor authentication for users accessing a company’s payment platform. Companies can also leverage U.S. Bank expertise to learn more about best practices for preventing fraud and protecting their payment processes at every point of the transaction.

3. Leverage legal and regulatory expertise.

Conducting cross-border payments means complying with everything from data security standards and counter-terrorism financing requirements to banking regulations and foreign exchange rules. Working with payments partners who have regulatory expertise can ensure that your transactions meet all necessary requirements — avoiding penalties or excessive fees. A payments partner with deep experience like U.S. Bank can help you navigate all the complexities of regulations in each country.

4. Maximize cash flow and payment timing.

Cross-border payments can take between one and five days or more to complete, depending on the bank or service you’re using. If international transactions comprise a significant portion of your expenses or revenue, optimizing the timeline—and having visibility into your cash position — is crucial. You want to see real-time balances worldwide and move money between your organizations efficiently. While this is always important, it’s especially critical in a high-interest-rate environment or when trying to take advantage of currency exchange rates. U.S. Bank offers same-day payments in multiple jurisdictions, lower-cost payments for less urgent transactions, and strategic FX guidance.

Global payments success

Improving and streamlining your global payments is well worth the effort. For example, many U.S. Bank customers take advantage of bulk payment processing to complete entire payment runs — with vendors in multiple countries — in one click. Another U.S. Bank customer, a nursery that sells plants worldwide, relies on U.S. Bank Global Payment and International Solutions to not only centralize their AP activity but integrate and manage multiple financial accounts in various jurisdictions.

As you consider global payments solutions, Towers recommends looking for a partner that provides visibility, speed, cost efficiency, FX expertise, and a safe and secure payments processing platform. “The combination is key to helping businesses tackle global payments and transform them into an advantage,” Towers says.

The experts at U.S. Bank are ready to help you create or improve your international payments and receivables strategies and equip you with powerful global payment solutions. Interested in learning more about U.S. Bank Global Payment and International Solutions? Connect with us today.