Cross-border Payments for Businesses: How to Pay and Get Paid Internationally

In 2022 alone, businesses made over $150 trillion in B2B cross-border payments. With staggering numbers like that, it’s no surprise that cross-border trade is top of mind for businesses looking to scale and diversify their revenue.

‍

However, that is easier said than done. Sending and receiving funds across borders can get complicated real fast. With complex regulatory processes, long settlement times and unplanned fees, it’s enough to give any business owner pause.

‍

That’s not to downplay how far cross-border payments have evolved. Today, they’re faster, smarter and more accessible than ever. But for your business to truly benefit, you need to understand what it takes to pay a supplier in China, receive funds from a client in the UK, or manage payroll across Africa.

‍

In this article, we’ll walk you through the nuts and bolts of cross-border payments: the methods, common use cases, benefits, and how to streamline it all. If your business is looking to scale globally, this guide is your starting point.

‍

What are Cross-border Payments?

‍

Cross-border payments are financial transactions where the payer and recipient are located in different countries. They allow businesses and individuals to send and receive funds or assets internationally, usually through banks or other financial platforms.

‍

Today, cross-border payments power everything from international trade to remote work and global supply chains.

‍

These payments are used by:

• Businesses paying suppliers, partners, or employees in other countries
• Freelancers and remote teams getting paid across borders
• Exporters and importers managing international transactions

‍

As more businesses look to scale and expand beyond their local markets, it has become critical to their growth that they be able to move money in multiple currencies across borders quickly and securely. But without efficient cross-border payment practices, that same growth can quickly get weighed down by delays, fees, and operational strain.

‍

How Does Cross-Border Payments Work?

‍

While on the surface cross-border transitions might seem pretty easy— enter the recipient’s details, amount, etc and hit send, a lot more goes on behind the scenes to move funds safely and compliantly from one country to another.

‍

Behind-the-Scenes of a Cross-Border Transaction

‍

Every cross-border payment typically goes through a few critical layers:

1. Initiation: The payer (sender) initiates the transaction through their bank or a payment service provider (PSP). They provide details like the amount, currency, recipient’s bank information and account number.

• Intermediary Network: If the sender’s and recipient’s banks don’t have a direct relationship, one or more correspondent banks help bridge the gap.
• Currency Conversion: If the transaction involves different currencies, an FX provider converts the funds, often applying a spread or fee.

2. Transfer: The sender’s bank or PSP sends the payment information to the recipient’s bank. This often involves the SWIFT network, which acts as a messaging system for international bank transfers. However, if the sender’s and recipient’s banks don’t have a direct relationship, the payment may be routed through one or more correspondent banks.

Correspondent banks enable international payments between two banks that don't have a direct relationship. These banks serve as intermediaries, offering pathways to global financial networks and enabling transactions across various currencies and jurisdictions.

3. Clearing and Settlement: The payment is cleared (verified and matched) and settled (funds are transferred between banks), which can take anywhere from minutes to days depending on the payment corridor. When the payer and receiver use different currencies, the payment process may involve a  currency conversion. Once settled, the recipient's bank deposits the funds in the recipient's account.

‍

Key Stakeholders Involved in a Cross-Border Transaction

‍

1. Sender: The party (individual or business) who initiates the payment.
2. Recipient: The party who receives the funds.
3. Banks: Both the sender’s and recipient’s banks, and often, correspondent banks.
4. Payment Service Providers (PSPs): Fintechs or platforms like Cedar Money that simplify the process by offering faster routing, compliance automation, and better rates.

‍

The Compliance Aspect

‍

Cross-border payments are closely monitored due to anti-money laundering (AML), counter-terrorist financing (CTF), and sanctions regulations. These transactions are frequently screened against global compliance standards, often at multiple points in the payment process. This necessary attention to detail can slow things down or flag issues if not carefully managed.

‍

That’s why businesses making cross-border payments need partners that are capable of automating these checks efficiently, without compromising speed or a positive user experience. Cedar, for example, offers multi-factor authentication and other enterprise-grade security features to keep payments secure, while also simplifying the entire cross-border transaction process from initiation to settlement.

‍

Common Ways to Send and Receive Money Internationally

‍

When it comes to moving money across borders, there are quite a number of options available, each with its own pros, cons and use cases. Choosing the best cross-border payment method for any transaction depends on several factors: the amount to be transferred, the payment corridor (i.e., the originating and receiving countries), the currencies involved, and the associated fees, which can vary between providers and methods.

‍

These are the most common ways to make cross-border payments:

‍

1. Wire Transfers:

‍

This is the more traditional, well-established, and widely accepted method for sending funds internationally. It involves the electronic movement of funds from one bank account to another. Wire transfers are a go-to for many businesses, particularly when dealing with high-volume transactions. However, they can be quite costly, especially when routed through multiple correspondent banks.

‍

2. Electronic Fund Transfers (EFTs)

‍

This is a broad term for any transfer of funds initiated electronically between accounts, utilizing methods like SWIFT, Fed-wire or other systems.  Some types of EFTs include ACH payment or ACH direct deposits, Credit card or debit card transactions, peer-to-peer payments and even wire transfers.

‍

All wire transfers are EFTs but not all EFTs are wire transfers.

‍

3. Digital Wallets and Fintech Platforms

‍

Modern platforms like Cedar Money are redefining how businesses make cross-border payments. With faster processing and settlement times, transparent fees, and user-friendly dashboards, fintechs offer a more flexible experience. They often support multiple currencies and payout options, making them ideal for businesses that need to move fast and efficiently.

‍

4. Card Payments

‍

Debit and credit card payments can be convenient for smaller, one-off international purchases, think SaaS subscriptions or travel expenses. But for B2B transfers or high-volume transactions, they often come with high interchange fees, limited payout control, and stricter usage caps.

‍

5. Cryptocurrency

‍

Crypto offers speed, transparency, and low fees, making it appealing for some startups and freelancers. However, adoption remains uneven, and regulatory uncertainty can pose risks for businesses. Cedar doesn’t currently support crypto, but it’s an area many fintechs are watching closely.

‍

For both businesses engaged in international trade and individuals sending or receiving funds across borders, a thorough evaluation of the available payment solutions is paramount.

‍

This careful consideration ensures the selection of a method that not only aligns with their specific financial requirements but also optimises for speed, cost-effectiveness, security, and convenience. Understanding the nuances of each option empowers users to navigate the complexities of international payments efficiently and effectively.

‍

How Businesses Use Cross-Border Payments

‍

Cross-border payments are the engine behind countless business operations. Here’s how they show up in real-world scenarios:

‍

1. Paying International Suppliers and Freelancers

‍

Whether you're sourcing materials from Asia or working with a designer in Canada, businesses need a fast, reliable way to pay overseas vendors. Delays or errors here can strain relationships and slow down production.

‍

2. Receiving Customer Payments from Abroad

‍

Cross-border payments don’t just go out, they come in, too. E-commerce brands, B2B services, and exporters need infrastructure to accept payments from customers in other currencies and countries. The easier it is to pay you, the faster your global business can grow.

‍

3. Cross-Border Payroll for Remote Teams

‍

With distributed teams becoming the norm, businesses need seamless ways to run payroll across multiple countries. Ensuring employees and contractors are paid accurately and on time (in their local currency) is a must.

‍

4. Settling Marketplace Earnings

‍

If you sell on global marketplaces like Amazon, Etsy, or Upwork, your earnings often come in different currencies. Managing payouts across platforms and countries can get complex, unless you have a centralized solution.

‍

5. Paying for B2B SaaS or International Services

‍

Think email platforms, cloud hosting, legal support, or marketing consultants. Businesses frequently rely on international services and tools, and having an efficient payment method simplifies vendor relationships.

‍

Benefits and Limitations of Cross-Border Payments

‍

No payment method is perfect. Here’s what to expect when dealing with international transfers:

‍

Benefits

‍

• Wider Reach: You’re not limited by geography. Tap into talent, customers, and markets around the world.
• Business Scalability: As your operations grow, you can expand into new regions without needing to overhaul your financial setup. Note that this is only possible if your chosen payment platform is scalable.
• Process Efficiency: Modern platforms offer automation, API integrations, and dashboards that help reduce manual errors and administrative overhead.

‍

Limitations

‍

• High Costs: Traditional payment routes often involve multiple intermediaries, hidden fees, and costly FX margins.
• Slow Settlement: Some corridors still take several days for payments to clear, especially with banks.
• Compliance Complexity: Varying regulations across countries can slow transactions or even block them if not properly handled.

‍

‍

How to Make a Cross-Border Payment (Step-by-Step)

‍

If your business is sending or receiving money internationally, here’s a clear process to follow:

‍

1. Choose a Payment Provider

‍

Look for one that supports the currencies and countries you operate in, offers favourable rates, and meets your speed and compliance needs.

‍

For instance, Cedar Money enables businesses to send over 30 million dollars daily to other businesses in over 190 countries around the world and receive from 9 major African markets.

‍

2. Check the Exchange Rate

‍

Understand how much your recipient will receive and how much the transaction will really cost after FX spreads and fees.

‍

3. Add Recipient’s Details

‍

This typically includes the recipient’s name, account number, bank name, SWIFT code (or local equivalent), and address.

‍

4. Verify and Send the Payment

‍

Review all the information carefully. A small error (like a typo in the account number) can delay or bounce the transfer.

‍

5. Track the Payment

‍

Modern providers like Cedar Money let you follow the payment in real-time with updates at every stage, no need for “just checking in” emails.

‍

6. Confirm Arrival

‍

Make sure the recipient receives the funds in full. Some platforms (like Cedar) generate payout confirmations to help you document the arrival and build trust with partners.

‍

How Cedar Money Helps You Send and Receive International Payments

‍

Whether you’re scaling operations, running payroll, or settling invoices across borders, Cedar Money is built to keep your money moving fast, safe, and stress-free.

‍

• Send payments to 190+ countries

From Europe to Asia, North America to Australia, send funds globally without dealing with multiple providers or high FX markups.

‍

• Receive payments from 9 African countries

‍Collect money from clients, partners, and marketplaces in Nigeria, Kenya, Ghana, South Africa, Tanzania, Rwanda, Uganda, Zimbabwe, and Ivory Coast, all through a single Cedar account.

‍

• Transparent rates and fast settlements

Cedar offers competitive exchange rates and T+1 settlement speeds, so your funds move as fast as your business. No surprise fees along the way.

‍

• Smart account controls

Invite team members, assign access roles (owner, admin, viewer), and manage approvals without needing to share passwords or chase updates.

‍

• Real-time tracking and payout confirmations

Get updates on payment status, delays, and arrival confirmations, keeping you and your partners in sync.

‍

• Developer- friendly API

‍

Use our developer-friendly API to automate payouts and reporting, and manage everything from our clean, intuitive web dashboard.

‍

Conclusion

‍

Cross-border payments aren’t just a back-office function, they’re a key driver of global business growth. But only if they’re done right. With the right tools, providers, and strategy, you can save time, reduce costs, and build stronger global relationships.

‍

Whether you’re just getting started or looking to streamline your existing process, Cedar Money is here to help you move money smarter. Get started today!