B2B Payments

A Global Payments Study Guide For SMEs

Cross Border payments

FinTech and technology in general are helping SMEs bring their goods and services across time zones and currencies. Mike Ward, CEO of World First’s North American operations, discusses what the most critical knowledge points are when executives consider moving beyond home base.

The movement toward globalization, for B2B and for SMEs, has a number of benefits. There’s the entrance into new markets and the ability to reach new customers. For the supply chain, there’s the lure of finding lower-cost goods (or even services), the attendant margin improvement and the boon of having goods even closer to end customers in a local setting.

But, as with any shift beyond the home market, there are growing pains. Not just staffing issues, learning the local culture in a new market and, as is germane for payments, learning the local views on cash, credit and import and export taxes. Foreign exchange takes its place as a central concern among SMEs looking to work in a cross-border environment.

In an interview with PYMNTS, Mike Ward, chief executive officer of North America for World First, which enables international money transfers, including between businesses, said that the biggest challenge facing firms in North America as they seek to expand, especially into areas such as Asia, whether in goods or services, “is to work with the right infrastructure.” And that infrastructure need not necessarily be owned entirely by the firm in question, added Ward, but must be used in sync with the right partners operating in the areas marked for expansion.

Ward stated that businesses in the U.S. are further behind in knowledge about what is effective in working with FX services or with technology that can make money transfers streamlined, where as in, say, Canada, there is somewhat broader knowledge of what the alternatives are to traditional banking relationships. There can even be ennui on the part of business owners already doing FX and money transfers through banks, said the executive, with a “don’t-rock-the-boat” mindset with the partner that is already extending lines of credit or other services.

Offering his own firm’s perspective, said Ward, across a roster that numbers more than 25,000 SMEs globally (of which 11,000 are corporate clients), it is eCommerce — specifically, electronics and specialty items, especially clothing — that has been seeing the most rapid growth and desire to move internationally, thus leading to a need for currency transfers. “On the supplier side,” he said, “it is transport and manufacturing” where there is desire and opportunity “to expand across multiple currencies … but margin is critical. Also, within the travel industry,” he added, “margins are pressured, even while there is pricing pressure” and even a few basis points can make a difference.

AML requirements, said Ward, are largely dependent on the point of sale and where money winds up traveling. The executive noted that “some areas of regulations are gray” and that it is hard to get answers, in some cases, to exactly what needs to be done in specific countries. And with the disruption that has come with FinTech, said Ward, the fact remains that “regulators are playing catch-up” with an eye on transparency. It is transparency, said Ward, that helps level the playing field between buyers and sellers across B2B internationally, which means getting quick reads on market rates and exchange rates crucial to international trade.


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