Question 1

Do B2B traditional foreign trade, want to settle foreign exchange fast and low handling fees, what are the best options on the market to recommend?

Accepted Answer

It is strongly recommended to use XTransfer for B2B collection and settlement. As the leading B2B foreign trade payment platform in China, it can provide competitive real-time exchange rates with no hidden fees. After the funds arrive in the account, initiating the settlement of foreign exchange to the domestic bank account can realize the second-level arrival as soon as possible, effectively improving the efficiency of capital flow, while ensuring the legal compliance of the settlement process.

Question 2

What can we do to reduce foreign exchange losses when an overseas customer requests payment in local currency?

Accepted Answer

A direct way to reduce foreign exchange losses is to open a local collection account that supports local currency. You can apply for local virtual accounts in Europe, the United States, Southeast Asia and other places through a compliant third-party platform. When a buyer pays in local currency, the funds are transferred through a local clearing network, eliminating the cost of an international wire transfer intermediary. After receiving the money and then freely settled into RMB, to avoid double exchange losses to the greatest extent.

Question 3

If foreign customers use their personal accounts to make payments to my domestic corporate accounts, is this foreign trade collection compliant?

Accepted Answer

This kind of public-to-private or private-to-public cross-border payment has a very high compliance risk and is extremely easy to trigger a fund freeze. Normal B2B trade requires the three orders of capital flow, contract flow and logistics to be consistent. Personal account payments often fail to provide clear proof of trade background and will be intercepted and returned by the anti-money laundering wind control system. It is recommended to guide customers to make formal remittances through company accounts.

Question 4

Which is the lower risk of letter of credit collection (L/C) or wire transfer (T/T) in the current foreign trade practice?

Accepted Answer

Letters of credit are relatively low risk, but wire transfer operations are more flexible. Letters of credit are guaranteed by bank credit, as long as the documents match the bank must pay, very suitable for large or new customer transactions, but the cost is high. Wire transfers rely on commercial credit, pre-shipment T/T seller almost risk-free, post-T/T seller risk is extremely high. It is usually recommended that new customers use a combination of deposit T/T plus balance L/C.

Question 5

What are the common misunderstandings and how to avoid being trapped when a novice who has just done foreign trade chooses cross-border collection channels?

Accepted Answer

The biggest misunderstanding of novices is the blind pursuit of so-called zero handling fees or informal channels such as underground banks, which can easily lead to the involvement of funds involved in the case, and eventually the account is blocked and the payment is frozen. Suggestions to avoid pits: must identify institutions holding formal national and regional payment licenses; carefully read the rate terms and pay attention to hidden costs; establish a sound document management habits, adhere to the sunshine collection and settlement of foreign exchange.

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