Dealing with clients in USD
Discussion
Hey Guys and girls,
Just looking for some general advice. Situation is that the vast majority (90+%) are US based. When they pay their invoices Barclays helps themselves to a nice cut (£10 per invoice) beyond the % they make from the difference in commercial rates on currency.
To minimise this I asked my client to batch up the invoices into groups of 5 and then pay them, hence £10 rather than £50 per 5 invoices. That was all well and good pre-covid but now cash flow is becoming an issue. Ok so its not huge percentages but with an average of 10 invoices per month, it adds up, as a little side gig style business.
What is the best way to approach it to maximise income minimise cost? I am pretty pissed off with Barclays full stop because every time I ring I get off shore support. 'nuff said!
Just looking for some general advice. Situation is that the vast majority (90+%) are US based. When they pay their invoices Barclays helps themselves to a nice cut (£10 per invoice) beyond the % they make from the difference in commercial rates on currency.
To minimise this I asked my client to batch up the invoices into groups of 5 and then pay them, hence £10 rather than £50 per 5 invoices. That was all well and good pre-covid but now cash flow is becoming an issue. Ok so its not huge percentages but with an average of 10 invoices per month, it adds up, as a little side gig style business.
What is the best way to approach it to maximise income minimise cost? I am pretty pissed off with Barclays full stop because every time I ring I get off shore support. 'nuff said!
ChocyLint1 said:
Hey Guys and girls,
Just looking for some general advice. Situation is that the vast majority (90+%) are US based. When they pay their invoices Barclays helps themselves to a nice cut (£10 per invoice) beyond the % they make from the difference in commercial rates on currency.
To minimise this I asked my client to batch up the invoices into groups of 5 and then pay them, hence £10 rather than £50 per 5 invoices. That was all well and good pre-covid but now cash flow is becoming an issue. Ok so its not huge percentages but with an average of 10 invoices per month, it adds up, as a little side gig style business.
What is the best way to approach it to maximise income minimise cost? I am pretty pissed off with Barclays full stop because every time I ring I get off shore support. 'nuff said!
Have you checked the costs of setting up a USD bank account? If you have to make any payments in USD then you can make them from there.Just looking for some general advice. Situation is that the vast majority (90+%) are US based. When they pay their invoices Barclays helps themselves to a nice cut (£10 per invoice) beyond the % they make from the difference in commercial rates on currency.
To minimise this I asked my client to batch up the invoices into groups of 5 and then pay them, hence £10 rather than £50 per 5 invoices. That was all well and good pre-covid but now cash flow is becoming an issue. Ok so its not huge percentages but with an average of 10 invoices per month, it adds up, as a little side gig style business.
What is the best way to approach it to maximise income minimise cost? I am pretty pissed off with Barclays full stop because every time I ring I get off shore support. 'nuff said!
Alternatively can your clients pay into your GBP account using something like Transferwise. Low cost for them and the payments will hit your account in GBP.
ChocyLint1 said:
Hey Guys and girls,
Just looking for some general advice. Situation is that the vast majority (90+%) are US based. When they pay their invoices Barclays helps themselves to a nice cut (£10 per invoice) beyond the % they make from the difference in commercial rates on currency.
To minimise this I asked my client to batch up the invoices into groups of 5 and then pay them, hence £10 rather than £50 per 5 invoices. That was all well and good pre-covid but now cash flow is becoming an issue. Ok so its not huge percentages but with an average of 10 invoices per month, it adds up, as a little side gig style business.
What is the best way to approach it to maximise income minimise cost? I am pretty pissed off with Barclays full stop because every time I ring I get off shore support. 'nuff said!
I will follow this with interest. I bank with Barclays too and have a USD account with them which means no charges on the money that comes in regardless of how they pay the invoices but I then lose a chunk on the exchange rate and associated fees. I’m moving a lot of dollars each year so even small savings can add up. Just looking for some general advice. Situation is that the vast majority (90+%) are US based. When they pay their invoices Barclays helps themselves to a nice cut (£10 per invoice) beyond the % they make from the difference in commercial rates on currency.
To minimise this I asked my client to batch up the invoices into groups of 5 and then pay them, hence £10 rather than £50 per 5 invoices. That was all well and good pre-covid but now cash flow is becoming an issue. Ok so its not huge percentages but with an average of 10 invoices per month, it adds up, as a little side gig style business.
What is the best way to approach it to maximise income minimise cost? I am pretty pissed off with Barclays full stop because every time I ring I get off shore support. 'nuff said!
I was with Barclays dealing with customers paying in USD in 2017. They gave us no warning but suddenly closed all of our accounts and very short notice to make other arrangements. Since then I warn people of what happened doing international business transactions with Barclays.
We then moved to LLoyds who offer a much better USD service integrated into their commercial banking client which has been smooth sailing for us ever since.
Revolut and other online banks can offer better rates but I have heard horror stories of accounts getting frozen for months while they investigate source of funds and KYC.
We then moved to LLoyds who offer a much better USD service integrated into their commercial banking client which has been smooth sailing for us ever since.
Revolut and other online banks can offer better rates but I have heard horror stories of accounts getting frozen for months while they investigate source of funds and KYC.
Hey all!
So I took a look at Starling again. I am guessing things must have changed since the last time I looked as they never used do USD accounts. The offer they have is £5 a month for unlimited payments from USD into GBP, with a fee of 0.4% above base rate.
For my scenario, this works exceptionally well because I already pay Barclays a fee per month to do absolutely nothing other than lend my money to other companies and keep the profits. Starling is free but the £5 a month USD fee means it is still cheaper than a basic business account with Barclays without even considering USD.
If you then add in the £10 per payment Barclays chage, plus their cut on the conversion rate, its a no brainer. It means that all my invoices can now be paid individually, so no cash flow issues by bundling them together to save money!
Looks like PH has come good for me on this one. Cheers guys! Just need to change my account to Starling now
So I took a look at Starling again. I am guessing things must have changed since the last time I looked as they never used do USD accounts. The offer they have is £5 a month for unlimited payments from USD into GBP, with a fee of 0.4% above base rate.
For my scenario, this works exceptionally well because I already pay Barclays a fee per month to do absolutely nothing other than lend my money to other companies and keep the profits. Starling is free but the £5 a month USD fee means it is still cheaper than a basic business account with Barclays without even considering USD.
If you then add in the £10 per payment Barclays chage, plus their cut on the conversion rate, its a no brainer. It means that all my invoices can now be paid individually, so no cash flow issues by bundling them together to save money!
Looks like PH has come good for me on this one. Cheers guys! Just need to change my account to Starling now
I'm not closely involved in this, but isn't there a transfer fee that someone, either sender, recipient or shared, that you have to pay anyway? When we (work) get dollars into our USD account with HSBC, there's always $20 less than the amount we've invoiced for.
We use WorldFirst for conversion into £ and Euro and they make most of our onward Euro payments too.
We use WorldFirst for conversion into £ and Euro and they make most of our onward Euro payments too.
Have recently gone through all of this myself.
Starling do indeed offer a USD account. However, they use ACH routing and many banks still work on IBAN which Starling don't provide for USD accounts.
I've so far not found a mainstream bank willing to open a USD account unless I have my business account with them and I really don't want to switch.
Transferwise appears to offer the best rates and simplicity.
Starling do indeed offer a USD account. However, they use ACH routing and many banks still work on IBAN which Starling don't provide for USD accounts.
I've so far not found a mainstream bank willing to open a USD account unless I have my business account with them and I really don't want to switch.
Transferwise appears to offer the best rates and simplicity.
Lots of FX brokerage firms will open a USD account for you. My mate owns www.hawkfx.com - I had him set up a local USD account for one of my businesses earlier this year. As soon as a payment lands it is automatically converted into GBP and put in the main business account. No fees and the FX rate is very reasonable.
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