ISME members know better than most the pressures of running a small or medium-sized business. You juggle cash flow, manage staff, and push for growth in a competitive market. When dealing with overseas suppliers or clients, another challenge often slips under the radar—the true cost of international payments.
Why SMEs can’t ignore this
Expanding into foreign markets brings opportunity, but it also exposes firms to fees, weak exchange rates, and delays. More than a third of Irish SMEs report difficulties with cross-border transfers. For businesses already operating on fine margins, this can be a serious drain.
Breaking down the hidden charges
International transfers are rarely as simple as they appear. Beyond the visible transaction fee, Irish SMEs often face:
• Transfer charges of €15–€50 per payment
• FX markups of 2–3% over the mid-market rate
• Receiving bank deductions of €10–€40
• Undisclosed intermediary fees
These add up quickly. Send €100,000 abroad and a poor exchange rate alone could cost €2,000, dwarfing the upfront fee.
The danger of exchange rate swings
Without a hedging strategy, SMEs leave themselves exposed. A sudden market shift can turn a profitable order into a loss. For some, one badly timed payment could mean strained supplier ties or cash shortages at home.
Operational headaches
According to LexisNexis, almost half of businesses report serious costs from failed payments. Simple mistakes, like mistyping an IBAN, can stall transfers, tie up funds, and add costly repair charges.
The growing risk of fraud
Invoice redirection scams are rising fast. FraudSMART figures reveal Irish SMEs lost more than €17 million through such schemes in just two years. Criminals know smaller firms often lack specialist defences, making vigilance vital.
Invoice redirection and CEO impersonation scams remain as top threats to businesses, which have seen average losses of €11,500.
Practical steps for ISME members
• Explore alternatives: Specialist FX payments companies often deliver much more competitive rates and lower costs than traditional banks.
• Lock in rates: Forward contracts provide certainty in planning and safeguard profits.
• Insist on clarity: Don’t accept vague fee structures—demand upfront transparency.
• Build awareness: Train your team to recognise fraudulent payment attempts. Never reply by email to requests to change bank account details. Fraudsters may be impersonating your supplier. Always verify change of bank detail requests by phone using the supplier number which you have on record.
Turning risk into control
Cross-border payments need not be a drain on resources. With the right systems, SMEs can take charge of costs, protect their bottom line, and trade with greater confidence.
Fexco International Payments, an Irish company headquartered in Kerry, partners with ISME to support members with smarter, safer payment solutions. We combine ZERO TRANSACTION FEES, competitive rates, and advanced safeguards designed for SMEs.
For ISME members, every euro saved strengthens competitiveness. Take the next step—review your payment processes and see what you could save with Fexco International Payments today.
Visit our dedicated ISME Member page for more – https://www.fexco.com/payments-and-fx/international-payments/isme/
