How to make international business payments from the UK

Why international business payments are more complex than domestic transfers

When you pay a UK supplier by Faster Payments or BACS, the transaction moves through a single, well-defined domestic network under one regulatory regime. The money leaves your account and arrives in the recipient's account, typically within seconds or a day. Cross-border payments do not work that way. They usually travel through a chain of correspondent banks, each holding an account relationship with the next, and each potentially deducting a fee and applying its own cut-off times. The number of intermediaries involved is rarely disclosed upfront, which is one reason why the final amount received can be lower than expected.

Currency conversion adds a further layer of complexity. If you are paying a US supplier in US dollars, your bank or payment provider must convert your sterling into dollars at some rate. The mid-market rate, the midpoint between the buy and sell prices on wholesale currency markets, is the benchmark journalists and comparison tools use. Banks and some payment providers quote a rate that is less favourable than that benchmark: the difference is the FX markup. On a £50,000 supplier payment, a 3 per cent markup costs £1,500, which is often several times larger than any stated transfer fee. The Payment Systems Regulator has noted this issue and in December 2024 launched a consultation on remedies for excessive cross-border interchange fees, signalling that transparency in international payment pricing is a live regulatory concern.

There are also compliance obligations to consider. UK businesses making international payments must comply with HM Treasury sanctions lists, anti-money-laundering rules under the Money Laundering Regulations 2017, and, where relevant, the financial crime requirements of the Proceeds of Crime Act 2002. Large or unusual payments to certain jurisdictions may be reported to the National Crime Agency. For businesses paying suppliers in high-risk regions, these requirements can add time to the process and require documented due diligence.

Finally, settlement timing matters for working capital. If your supplier expects payment within 30 days and your payment takes three to five business days to arrive after you initiate it, your effective payment window is shorter than the invoice terms suggest. Planning around realistic settlement times is therefore part of good cash-flow management for any business trading internationally.

The main payment rails: SWIFT, SEPA, and local networks

SWIFT, the Society for Worldwide Interbank Financial Telecommunication, is the messaging network that underpins most international bank-to-bank payments. It does not move money itself but carries standardised payment instructions between member banks globally. A typical SWIFT transfer takes two to five business days end to end, though the SWIFT GPI (Global Payments Innovation) service, now widely adopted, tracks payments in real time and has dramatically improved predictability: SWIFT reports that around three-quarters of GPI payments reach the beneficiary bank within ten minutes and almost all are credited within 24 hours, although final credit to the beneficiary account can still take longer where local checks, operating hours, or currency controls apply. In November 2025 SWIFT ended the coexistence period for cross-border payments and retired the legacy MT message format in favour of the richer ISO 20022 standard, which carries more structured data and should reduce manual intervention and rejections over time.

SEPA, the Single Euro Payments Area, is the eurozone's standardised payment infrastructure. UK businesses lost direct SEPA membership after Brexit, but many UK-authorised payment institutions still route euro payments through European correspondent banks with SEPA access, meaning your supplier in Germany or France can receive a SEPA Credit Transfer rather than a correspondent-banking SWIFT chain. SEPA Credit Transfers settle on the next banking business day. SEPA Instant, which settles within 10 seconds and is now mandatory for all eurozone payment service providers under the EU Instant Payments Regulation effective October 2025, is available through a growing number of UK-based providers.

Beyond SWIFT and SEPA, many specialised payment platforms and FCA-authorised payment institutions maintain direct integrations with local payment rails in key markets: ACH in the United States, IMPS and UPI in India, PayNow in Singapore, and various African mobile money systems. Paying through local rails rather than correspondent banking can be significantly faster and cheaper, because the payment avoids intermediary bank chains and any associated lifting fees. Nasara Pay is built around this principle, connecting UK businesses to local settlement infrastructure in their key trade corridors.

The choice of rail depends on several factors: the destination country, the currency, the urgency, the payment size, and the provider's network access. For large, infrequent payments to major economies, SWIFT remains reliable. For regular euro-denominated supplier payments, a SEPA-enabled route is usually faster and cheaper. For high-frequency, smaller payments to emerging markets, local rail access through a specialist platform typically delivers the best combination of speed, cost, and transparency.

Which currencies UK businesses actually use

Official HMRC data on UK trade in goods by declared currency of invoice provides a detailed picture of how UK firms invoice and pay internationally. For imports in 2024, 39 per cent of the value of goods imported from EU countries was invoiced in euros. For imports from non-EU countries, 64 per cent of value was declared in US dollars. The US dollar's dominance in non-EU trade reflects its role as the global commodity and trade pricing currency: if you are importing electronics from South Korea, raw materials from the Americas, or manufactured goods from China, the dollar is almost certainly involved.

Pound sterling's share of import invoicing fell to its lowest recorded proportion in 2024 data. This reflects a long-run shift: as UK businesses source from more diverse geographies and suppliers in those markets price in dollars or local currencies, the pound plays a smaller role. For UK exporters, dollars dominated non-EU export invoicing at 58 per cent, while pound sterling led for exports to EU countries at 27 per cent of declared value. The practical implication is that most UK businesses with international supply chains need to manage at least two or three currencies regularly.

Currency risk, the risk that exchange rate movements change the sterling value of a foreign-currency payment between the invoice date and the payment date, is a material business issue. In a 2025 survey of more than 500 UK SMEs for the Bibby Financial Services Trading Places report, 54 per cent said they had been stung by volatile exchange rates over the past year, with affected firms losing an average of around £53,000, and 58 per cent said they had adjusted their FX strategy in response. Tools available to manage this risk include forward contracts, which lock in a rate for a future date, and limit orders, which trigger automatically when a target rate is reached. These are offered by most specialist payment providers and many banks, though the suitability of any specific instrument depends on the firm's circumstances and is a matter for professional advice.

Chinese yuan (CNY/RMB) showed a gradual increase in share over recent years in official HMRC data, reflecting growing UK-China trade volumes. For businesses trading with China, understanding the distinction between offshore renminbi (CNH, freely traded) and onshore renminbi (CNY, subject to Chinese capital controls) is practically important: settlement routes and availability differ, and not all providers handle both.

Costs and fees: what UK businesses actually pay

The cost of an international business payment has two main components: the transaction fee and the FX margin. Transaction fees are the amounts a bank or payment provider charges explicitly for processing the transfer. For a SWIFT payment through a high-street UK bank, fees typically range from £15 to £40 per transaction, and additional correspondent bank charges may be deducted from the amount in transit, meaning the recipient gets less than the sender expects. Some providers offer 'SHA' (shared), 'OUR' (sender pays all), or 'BEN' (beneficiary pays all) charge instructions, with 'OUR' preventing deductions en route but at a higher upfront cost.

The FX margin is usually a larger cost but less visible. When a bank converts your pounds to dollars at a rate of 1.24 rather than the mid-market rate of 1.26, the 1.6 per cent difference is revenue for the bank. On a £100,000 payment that difference amounts to £1,600. FCA guidance specifically identifies FX pricing clarity as a priority area, and the regulator has flagged that many firms' approaches do not adequately help customers understand the total price of the service. Published estimates suggest FX markups by traditional banks add 2 to 5 per cent to each cross-border transfer.

Specialist payment institutions and licensed platforms typically offer tighter FX margins than high-street banks, often working closer to or at the mid-market rate and charging a transparent flat or percentage fee instead. For businesses making regular or high-value international payments, the savings can be significant. A business sending £500,000 per year in international payments at a typical bank markup of 3 per cent versus a specialist at 0.5 per cent saves approximately £12,500 annually on FX costs alone, before counting transaction fee differences.

There are also indirect costs worth considering: the operational time spent managing manual payment processes, dealing with payment failures or rejections due to incorrect beneficiary details, and reconciling payments that arrive with deducted fees. Platforms that offer pre-validation of account details, real-time payment tracking, and structured data under ISO 20022 can materially reduce these operational overheads.

The UK regulatory framework for international payments

Any firm offering international payment services in the UK must be authorised or registered by the Financial Conduct Authority. Providers offering money remittance or payment services must hold Authorised Payment Institution (API) status for volumes above approximately 3 million euros per month, or Small Payment Institution (SPI) status for lower volumes. Electronic Money Institutions (EMIs), which issue e-money and may also offer payment services, operate under a parallel framework. The FCA's register is publicly searchable and the first check any business should make when selecting a payment provider.

Safeguarding is a core requirement for all APIs and EMIs. Under the Payment Services Regulations 2017 and Electronic Money Regulations 2011, these firms must segregate customer funds from their own operating money, either by holding them in a designated account at a credit institution or by covering them with an approved insurance policy. The FCA finalised major reforms to the safeguarding regime in 2025, with strengthened rules under PS25/12 taking effect in May 2026. These reforms were prompted in part by cases where payment institution failures left customers with significant shortfalls: the FCA noted that in past failures, customers recovered only 35 per cent of funds owed on average. When you choose a payment platform, understanding how it safeguards your money is as important as understanding its fees.

Sanctions compliance is a non-negotiable element of international payments. Since Brexit the UK has operated its own autonomous sanctions regime under the Sanctions and Anti-Money Laundering Act 2018, with financial sanctions administered by the Office of Financial Sanctions Implementation (OFSI) within HM Treasury. Businesses should note a recent change to how the data is published: the standalone OFSI Consolidated List of Financial Sanctions Targets closed on 28 January 2026, and the UK Sanctions List, maintained by the Foreign, Commonwealth and Development Office, is now the single source for all current UK sanctions designations. UK businesses must screen payment destinations against that list before initiating transfers. Most regulated payment providers screen automatically, but businesses retain their own compliance obligations and should not rely entirely on their provider.

The broader regulatory landscape for UK payments is evolving. HM Treasury announced in March 2025 that the Payment Systems Regulator would be absorbed into the FCA, consolidating oversight under a single regulator. The PSR's existing work, including its December 2024 consultation on cross-border interchange fees charged on UK-EEA card transactions following the post-Brexit removal of EU interchange fee caps, will continue under the FCA. Businesses that accept card payments from EU customers may be particularly affected by the outcome of that consultation, as interchange fees rose from 0.2 per cent to 1.15 per cent for debit and 0.3 per cent to 1.5 per cent for credit after Brexit caps were lifted.

Choosing the right provider for your business

The right provider depends on the nature and volume of your international payment flows. High-street banks offer familiarity and integration with your existing current account, but they typically charge higher fees and wider FX margins, and their payment operations may not be optimised for speed on less common corridors. For a business making one or two large international payments a year, a bank SWIFT transfer may be adequate. For businesses paying overseas suppliers regularly, the accumulated cost difference justifies comparing specialist options.

FCA-authorised payment institutions and EMIs designed for business payments offer tighter FX rates, more transparent fee structures, and often faster settlement through local rail access. When evaluating providers, the key questions are: Is the firm on the FCA register? How does it safeguard client money? What FX rate will I actually receive, and how does it compare to the mid-market rate? Does it offer payment tracking? Can it integrate with my accounting software or ERP system? What support is available if a payment fails or is delayed?

Nasara Pay is designed for UK businesses making cross-border supplier and trade payments, with FCA authorisation, transparent pricing, and direct local rail connectivity in key markets. For businesses whose international payments are part of a wider GRC (governance, risk, and compliance) framework, integrating payment controls into internal policies around sanctions screening, approval workflows, and FX risk management matters as much as the transaction cost itself.

It is also worth considering whether your business would benefit from a multi-currency account, which holds balances in foreign currencies and allows you to pay out without converting every time. If you regularly receive payments in dollars or euros and also pay suppliers in those currencies, holding a foreign-currency balance eliminates the round-trip conversion cost. Several UK-regulated providers offer multi-currency business accounts as part of their international payment service.

For businesses trading in emerging markets or making payments in less common currencies, due diligence on the provider's specific corridor capability is essential. A provider may quote competitive rates for GBP/USD but use a slow and expensive correspondent chain for GBP/NGN or GBP/KES. Ask explicitly about settlement times, rate sources, and any specific country or currency restrictions before committing.

Practical steps to improve your international payment process

Start with a payment audit. Map out every international payment your business makes in a typical month: destination countries, currencies, amounts, frequency, and the provider or method used for each. This baseline gives you the data to calculate what you are currently paying in fees and FX margins and to identify where the biggest savings or efficiency gains lie. Many businesses find that a handful of high-value corridors account for the majority of FX cost, making those the priority for optimisation.

Get supplier account details right before you send. A common cause of delayed or failed international payments is incorrect beneficiary account information. SWIFT payments require the IBAN (International Bank Account Number) for European accounts and the SWIFT/BIC code for the recipient bank. For US payments, you need the routing number and account number. For other markets, requirements vary: some use IBAN equivalents, others use local bank codes. Many providers now offer pre-payment account validation that checks these details against bank records before you submit, reducing failures and the operational cost of chasing misdirected funds.

Consider your FX timing strategy. If you know you need to pay a dollar invoice in 60 days, you have options. You can convert at today's spot rate and hold the dollars, buy a forward contract to lock in today's rate for settlement in 60 days, or wait and convert at the rate prevailing in 60 days. Each has risk and cost implications. The appropriate approach depends on your risk appetite, the size of the exposure, and professional advice tailored to your circumstances. The key point is that doing nothing is itself a choice with FX risk attached.

Build compliance into the payment workflow. Sanctions screening should happen before a payment is submitted, not as an afterthought. Your payment provider will screen as part of their own compliance, but as a UK business you have independent obligations under the UK sanctions regime overseen by OFSI. Maintain a documented record of sanctions checks against the UK Sanctions List for significant payments. Where your business pays into higher-risk jurisdictions, document the basis for the payment and the due diligence carried out. These records matter if questions are ever raised about a specific transaction.

Finally, integrate your payment data with your accounting and finance systems. Reconciling international payments manually is time-consuming and error-prone. Most modern payment platforms offer API connectivity or direct integrations with accounting software such as Xero or QuickBooks, allowing payment status, FX rates applied, and confirmation data to flow automatically into your books. Reducing the manual reconciliation burden frees finance resource for higher-value analysis and strengthens the audit trail for tax and compliance purposes.

Conclusion

International business payments are a core operational function for any UK firm with cross-border trade, investment, or supplier relationships. The market has changed significantly in recent years: SWIFT's ISO 20022 migration, the expansion of SEPA Instant across the eurozone, the growth of FCA-authorised specialist payment platforms, and a sharpened regulatory focus on FX pricing transparency have all created better conditions for UK businesses than existed a decade ago. The cost and friction of cross-border payments is falling for businesses that actively choose the right provider and the right rail for each corridor.

The businesses that gain most are those that approach international payments with the same rigour they apply to any other business cost: understanding what they are paying, why, and whether a better option exists. FCA authorisation, transparent FX pricing, strong safeguarding, and local rail access are the benchmarks to apply when evaluating any provider. Platforms like Nasara Pay are built specifically to meet these criteria for UK businesses trading across borders, combining regulatory compliance with the connectivity and transparency that modern international payments demand.

Frequently asked questions