Learn how importers make international payments to overseas suppliers. Compare bank wires, letters of credit, documentary collections and trade payment platforms.

B2B Payments

How Do Importers Make International Payments in 2026

XTransfer Editorial | 10 min read | August 21, 2026

Introduction

If you are an importer, you know the feeling: you have found the right supplier, negotiated the price, and confirmed the order. Then comes the question that stops many businesses in their tracks—how do you actually get the money to them?

Sending money overseas sounds simple. But anyone who has done it knows the reality: funds that can take days to arrive, amounts that can come up short due to hidden fees, exchange rates that move against you between quote and settlement, and compliance reviews that may delay a payment while the bank or provider requests additional information.

The truth is, international payments for importers are not just about moving money—they are about managing risk, cost, and timing across borders. And not every payment method is built for the same job.

Quick answer: Importers commonly use bank wires, letters of credit, documentary collections, and digital trade-payment platforms. The best option depends on the supplier relationship, order size, payment timing, currency, required documents, and acceptable level of risk.

Why International Payments Are Different

Unlike a domestic transfer, an international payment does not always move directly from your bank account to your supplier's. A traditional cross-border wire may travel through a network of correspondent banks, each with its own fees, processing times, and compliance checks.

A cross-border wire typically involves:

Your bank (the remitting bank)—where you initiate the payment
One or more intermediary banks—that may relay the payment across borders
Your supplier's bank (the beneficiary bank)—where the funds finally arrive

Depending on the route and fee arrangement, banks in the payment chain may apply correspondent, receiving or other charges. These deductions can reduce the final amount received by your supplier.

Each leg of the journey may also trigger a compliance review. And because the payment crosses time zones and legal jurisdictions, the total time from initiation to arrival can range from same day to several business days, depending on route, currency, cut-off times, and reviews.

Step 1: Payment Initiation and Information Entry

The importer submits a payment instruction to their bank or payment platform. The required fields depend on the payment route; they may include the supplier's full name, account number (or IBAN), the receiving bank's SWIFT/BIC code, and in some cases the bank's physical address, purpose of payment, and amount.

Critical note: Even a small error in bank details can cause a payment to be queried, delayed or returned. Accuracy in this step is not optional.

Step 2: Compliance Review

The initiating bank or platform conducts a compliance review. This includes Know Your Customer (KYC) checks on the payer, as well as transaction monitoring reviews of the payment purpose and trade background.

Compliance screening can delay a payment when a bank or platform needs additional information about the parties, purpose or trade documents. For large transactions or payments to certain regions, the review may require additional documentation such as contracts, commercial invoices, or customs declarations.

Step 3: Clearing Network Transmission

Once approved, the payment is routed through the relevant messaging, clearing and settlement systems. A traditional wire may use SWIFT for payment instructions and may also involve domestic or regional systems such as CHIPS, CIPS, or European payment systems, depending on the currency and route.

Fee-code reminder: For payments using the relevant SWIFT message format, the charge code may indicate whether fees are intended to be paid by the sender, shared, or charged to the beneficiary. The codes are commonly described as OUR, SHA and BEN, but the actual deductions depend on the banks and payment route. Ask your bank or provider how charges will be applied and confirm the expected net amount.

Step 4: Receiving Bank Processing

The supplier's bank receives the payment instruction, conducts its own compliance checks, and credits the funds to the supplier's account. If conversion is required, it may occur at one of several points in the payment chain—the sending bank, an intermediary, the receiving bank, or a separate FX provider.

Bank Wire Transfer (T/T)

Telegraphic Transfer (T/T) is widely used in B2B trade for supplier payments. It is reliable and broadly accepted, but it can be slow (often taking one to several business days, depending on the route and bank), expensive (multiple bank fees may apply), and opaque (limited visibility into the payment's progress).

Depending on the relationship and bargaining position, contracts may also use cash-in-advance, open-account terms, or staged payments tied to production, shipment or document milestones.

Letter of Credit (L/C)

For large orders or new supplier relationships, a Letter of Credit provides documentary-payment protection within the bank-mediated payment process. Governed by the ICC Uniform Customs and Practice for Documentary Credits (UCP 600), a letter of credit is an irrevocable undertaking by the issuing bank to pay the beneficiary when the beneficiary presents documents that comply with the credit terms.

The issuing bank's obligation is generally triggered when the presentation complies with the credit terms, subject to the applicable rules and law. L/Cs provide strong documentary-payment protection but are costly and document-intensive.

Documentary Collection

This method uses banks as intermediaries to exchange payment for shipping documents. Governed by ICC Uniform Rules for Collections (URC 522), a documentary collection involves the seller shipping the goods and routing the shipping documents through the banking system.

There are two types:

Documents against Payment (D/P): Under D/P, the bank releases the shipping documents only when the importer pays. Payment is required upfront before the documents are released.
Documents against Acceptance (D/A): Under D/A, the bank releases the documents against the importer's signed undertaking to pay at a future date, which extends credit to the importer.

Documentary collection is less secure than a Letter of Credit—banks act as couriers for documents and do not guarantee payment. However, it is cheaper than an L/C and serves as a middle ground between cash in advance and a letter of credit.

Trade Payment Platforms

Digital platforms such as XTransfer provide an alternative to traditional banking channels. Some platforms use local payment rails or partner financial institutions, depending on the route.

For importers paying suppliers in China, XTransfer's "Pay to China" service supports CNY settlement to supplier bank accounts in Mainland China and Hong Kong SAR on eligible routes. For eligible CNY payments, XTransfer's help documentation states that it can complete the applicable FX reporting to the bank on the customer's behalf and send CNY to the supplier's bank account.

XTransfer-to-XTransfer transfers may be near-instant, available 24/7 and free on eligible routes. Pay to China timing, eligibility and fees depend on the currency, beneficiary account and route.

XTransfer and Société Générale announced on June 4, 2026 that they had signed a Memorandum of Understanding to enhance cross-border payment infrastructure and explore integrated financial solutions supporting international trade flows. The cooperation includes "Pay to China" services with USD and CNY settlement and transfer services in Hong Kong SAR and Mainland China, strengthening connectivity for trade flows between Asia and Europe.

Intermediary Bank Fees

Intermediary and receiving-bank charges vary by route, currency, bank and charge arrangement. Ask whether the payment uses OUR, SHA or BEN and confirm the expected net amount before sending.

Exchange Rate Spreads

The rate you see on Google is not the rate you will get. Providers may apply a markup or use a rate that differs from the benchmark rate; compare the quoted rate and final delivered amount. A 0.5% difference on a $100,000 payment would equal $500; a 1% difference would equal $1,000—so comparing the total delivered amount, not just the upfront fee, is essential.

Compliance and Documentation Costs

If a payment is flagged for compliance review, it may require additional staff time or document preparation; in unusual cases, external professional support may be needed. These costs are often unplanned and unpredictable.

Settlement Timing

A payment that takes extra days to arrive means extra days your supplier's production may be delayed. In supply chain terms, delayed payment can mean delayed delivery—and delayed delivery can mean lost customers.

The Five Costly Mistakes Importers Should Avoid

Mistake 1: Choosing the Cheapest Upfront Fee

The lowest transaction fee does not always mean the lowest total cost. A wire with a $15 fee but a 1.5% FX spread will cost more than a payment with a $30 fee but a 0.4% spread on a $50,000 transaction (about $750 versus $200 before fixed fees).

Mistake 2: Not Confirming Beneficiary Details

A mismatch in a supplier's name, account number or bank code can cause a payment to be queried, delayed or returned. Always confirm the full details—including the bank's SWIFT code and physical address where required—before initiating the payment.

Mistake 3: Ignoring Settlement Timing

If your supplier requires payment before shipping, a one-week delay in payment means a one-week delay in delivery. Factor processing time into your supply chain planning.

Mistake 4: Assuming One Method Works for All Suppliers

Different suppliers in different countries may have different preferences and capabilities. A method that works for a supplier in Europe may not work for one in Southeast Asia. Understand your supplier's receiving capabilities before choosing a payment method.

Mistake 5: Not Asking About Fee Sharing

Always confirm whether charges are SHA (shared), OUR (sender pays all), or BEN (beneficiary pays all). This determines who bears the cost of bank fees and can significantly affect the final amount your supplier receives.

Pre-Payment Checklist for Importers

Before initiating any international payment, there are several critical details that should be confirmed in advance.

First, verify the supplier's legal name and bank details through an independent channel. Payment currency should match the contract and invoice exactly. Confirm whether the payment will use SHA, OUR or BEN charges, and ask the bank or provider for the expected net amount the supplier will receive. It is also important to understand the expected settlement date and cut-off time for the specific payment route.

Ensure that the contract, invoice and shipping documents are ready if the payment route or bank requires them. Record the payment reference, confirmation and tracking details for future reconciliation.

Finally, never rely solely on an emailed bank-detail change—always verify any supplier bank account changes through a separate, independently confirmed channel before making a payment.

Choosing the Right Payment Method for Your Import Business

Payment Method	Typical Use	Main Advantage	Main Trade-off
Bank wire (T/T)	Routine supplier payments	Widely accepted	Route, fee and timing vary
Letter of credit	New suppliers or large orders	Bank-mediated documentary payment	Expensive and document-intensive
Documentary collection (D/P)	Established relationships, goods shipped	Lower-cost bank document handling	Payment required before documents released
Documentary collection (D/A)	Established relationships, credit extended	Buyer gets credit terms	Banks do not guarantee payment
Trade payment platform	Eligible recurring cross-border payments	May simplify local-route payments and fee visibility	Availability and terms vary by provider and corridor

How XTransfer Helps Importers Make International Payments

XTransfer is designed to simplify the international payment process for importers and exporters. The platform focuses on making cross-border payments clearer, faster, and more predictable for businesses engaged in global trade.

Pay to China

For importers paying eligible Chinese suppliers, XTransfer's Pay to China service supports CNY settlement to supplier bank accounts in Mainland China and Hong Kong SAR on eligible routes. For eligible CNY payments, XTransfer's help documentation states that it can complete the applicable FX reporting to the bank on the customer's behalf and send CNY to the supplier's bank account.

Importers remain responsible for providing accurate business and trade information and should confirm the applicable requirements before payment.

Partnership with Société Générale

Transparent Fee Structure

XTransfer publishes pricing information for specified services before payment confirmation. XTransfer lists free account opening, free account maintenance, and free receiving from another XTransfer account. Certain local currencies, including COP, PEN, CLP and ZAR, start from 0.5%. External bank transfers start from US$2 per transaction. XTransfer also lists a maximum fee of 0.4% for payments to China-based suppliers' personal bank accounts in CNY.

Account-to-Account Transfers

XTransfer-to-XTransfer transfers may be near-instant, available 24/7 and free on eligible routes. Availability and timing depend on account, currency, and route conditions.

Conclusion: Choose the Right Payment Method for Your Supply Chain

For importers, making international payments is not just about getting money to a supplier. It is about managing the cost, timing, and reliability of your entire supply chain.

The right payment method depends on:

Your supplier's location and banking capabilities
The size and frequency of your payments
Your relationship with the supplier
Your tolerance for cost versus your need for speed

Bank wires are reliable but can be expensive and slow. Letters of credit provide documentary-payment protection for new relationships but are complex to administer. Documentary collectionsoffer a middle ground but do not guarantee payment. Trade payment platforms such as XTransfer offer a modern alternative—with transparent fee structures, local payment connectivity, and integrated compliance support for businesses that make regular international payments.

If you pay suppliers internationally on a regular basis, request an account-specific quote from XTransfer to compare the total delivered cost for your routes.

Before choosing a payment method, calculate the total cost of your payment workflow—including fees, FX spreads, and any delays—not just the upfront transaction charge. The method with the lowest headline fee may not be the cheapest for your business.

Industry Context & Payment Methods

International Trade Payment Methods: Ultimate 2026 B2B Guide — Documentary Collection, Letters of Credit, Open Account: XTLINK0_TOKEN
International Payment Methods: Complete Guide for Importers — T/T, L/C, D/P and D/A: XTLINK0_TOKEN
Documentary Collections Explained for Importers — D/P vs D/A: XTLINK0_TOKEN
ICC Uniform Customs and Practice for Documentary Credits (UCP 600) — Letter of Credit Issuing Bank Undertaking: XTLINK0_TOKEN

SWIFT & Correspondent Banking

5. SWIFT — What Is SWIFT gpi and UETR?

(Tracking international payments): XTLINK0_TOKEN

XTransfer Official Sources

XTransfer — Services: Payment (Pay to China, X2X transfers, 24/7 near-instant): XTLINK0_TOKEN

7. XTransfer — How Can I Send Money Using My XTransfer Account?

(Pay to China: FX reporting, CNY to mainland China/Hong Kong): XTLINK0_TOKEN

XTransfer — Fair Pricing (Account fees, COP/PEN/CLP/ZAR from 0.5%, external transfers from US$2, CNY supplier payment max 0.4%): XTLINK0_TOKEN
Societe Generale — A Partnership to Streamline Cross-Border Payments for Global Trade (XTransfer MoU, Pay to China services, USD/CNY settlement): XTLINK0_TOKEN

Frequently Asked Questions

1. What is the most common way importers pay overseas suppliers?

A widely used method is bank wire transfer (T/T), which is accepted by most international suppliers but can be slow and subject to bank fees.

2. How long does an international payment take?

Traditional bank wires typically take one to several business days, depending on the route and bank. Some digital trade platforms may settle faster than traditional wires on eligible routes; check the provider's stated timing.

3. What information do I need to pay an overseas supplier?

Depending on the route, you may need the supplier's full name, account number (or IBAN), the receiving bank's SWIFT/BIC code, and in some cases the bank's physical address, purpose of payment, and amount.

4. Why did my payment arrive short?

Intermediary and receiving-bank charges vary by route, currency, bank and charge arrangement. Ask the bank or provider whether the payment uses SHA, OUR or BEN charges, and confirm the expected net amount.

5. What is the difference between D/P and D/A in documentary collections?

Under D/P (Documents against Payment), the bank releases the shipping documents only when the importer pays. Under D/A (Documents against Acceptance), the bank releases the documents against the importer's signed undertaking to pay at a future date, which extends credit to the importer.

6. Does XTransfer support payments to Chinese suppliers?

Yes. XTransfer's Pay to China service supports CNY settlement to supplier bank accounts in Mainland China and Hong Kong SAR on eligible routes. For eligible CNY payments, XTransfer's help documentation states that it can complete the applicable FX reporting to the bank on the customer's behalf. Importers should confirm the applicable requirements before payment.

7. What is a Letter of Credit and when should I use it?

A Letter of Credit is an irrevocable undertaking by an issuing bank to pay the beneficiary when the beneficiary presents documents that comply with the credit terms. It is typically used for large orders or when dealing with a new supplier.

8. Can I track an international payment?

Traditional bank wires offer limited tracking. For eligible SWIFT gpi payments, a UETR and tracking information may help identify payment status. Ask the sending bank what tracking information is available.

Disclaimer

This article is compiled from publicly available sources and interview content for informational purposes only and does not represent the official views of XTransfer. XTransfer accepts no liability for any damages arising from reliance on this content.