How to Make FX International Payments Easier and Cheaper

Get an FX payments business analysis

 

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An international payments business analysis (also known as savings analysis) is a customer-first and collaborative approach CXI provides to help you analyze and see how much your business could be saving on international payments.

Here’s a snapshot of how we break down your cost savings analysis into three main categories:

• Estimated Savings – 3-month savings vs. 1-year savings 
  • Comparing one-off rates from your current payments vs CXI is the first step. The next time you have a payment, get an immediate rate quote with CXI to compare one-on-one.
  • After confirming we can beat your current provider's rates, 90 days of activity will establish a long-term projection of how much you could be saving - quarterly and annually.
  • Account statements can identify additional costs you may not even know you were being charged for such as account management fees, check or payment issuance fees, software fees, and more. Understanding these in totality gives you a 360-degree view of the true cost of your international payments.
• Price Volatility –  A single currency is used to show you the FX exchange rate market trend
  • The price you pay today for a currency is not the same as the price you'll pay in the future. This currency exchange rate volatility introduces uncertainty in how much USD you will owe on future invoices. 
  • Becoming familiar with which currencies you will need for your supply chain and the timing of the payments is the start of developing your FX payments strategy. Reducing cost risks due to rate volatility must be the goal of every CFO and Treasurer today.
• Hedging and Risk Management – A hedging example based on data 
  • Armed with the knowledge of your foreign currency rate exposure you can now ensure profit margins, protect your balance sheet, and enhance your cash flow with the right hedging tools.
  • Your FX payments strategy will continue to be reviewed and adjusted based on market conditions and the needs of your business.

Leverage forward contracts

Forward contracts allow you to reduce exposure to exchange rate movements by locking in your currency exchange rate for international payments, up to 12 months in advance. Businesses can benefit from using forward contracts with their international payments by: 

• Protecting balance sheets and giving clarity to budgets 
• Establishing the exchange rate for a future date with no upfront cost 
• Utilizing the most common hedge for known currency receivables 
• Ensuring full protection against currency depreciation on the underlying position 

There would be no benefit to the business should the forward contract currency appreciate.

Utilize a dual invoice 

 

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To pay an invoice in a foreign currency, you should request a dual invoice. This is one of the most cost-effective and efficient ways for businesses to save when paying global vendors. When you pay a global vendor with their local funds, you eliminate any price buffers they add for rate fluctuation. You may save 15% just by paying in the vendor's local currency. Taking a closer look at a dual invoice helps you compare two prices of different currencies side by side. Above is an example of what a dual invoice is and how much it can save you.

Find your FX international payments advantage

International payment clients with CXI get access to a variety of benefits. Take advantage of having a trusted international bank group that makes foreign currency exchange their only focus so you can:

• Take control of your international payments easier and faster with industry-low rates 
• Reduce conversion costs with multi-currency accounts 
• Send and receive foreign currency payments globally with one provider 
• Know the status of your international payments with SWIFT gpi wire tracking 

CXI’s knowledgeable account managers provide risk-based strategies and market expertise that saves time and protects budgets. In our case study, this customer is among one of the top 10 financial institutions located in the United States. Due to the company’s increase in costs, compliance, and regulatory risks that are often associated with foreign exchange, they needed a trusted foreign exchange provider that would ease the burden and streamline their process.

CXI was able to provide an all-in-one customized solution for foreign currency exchange with a more personalized approach. The customer is now successfully delivering a groundbreaking level of superior customer service through a monthly grading system and ticketing reports with real results.

CXI provides a business review of each corporation’s specific situation and takes the time to build the right solutions for every relationship. Get your free business analysis. See how much you could save by uncovering the real costs of your international payments. Get started now to secure the best exchange rates and low fees.

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