4 Popular Payment Methods for Trading with China Suppliers

1 Bank TT (Wire transfer, bank telegraphic transfer)

For the first one, we want to talk about the Bank TT, it is a traditional and popular payment method, nowadays you can also choose to pay on an online bank website, it is convenient and secure.

How to use?

• You and beneficiary need to have international business bank account with the bank.
• Then you can ask the bank details from the beneficiary and usually it contains:

BENEFICIARY BANK/ SWIFT CODE NO/BANK ADDRESS/BENEFICIARY ACCOUNT NO/BENEFICIARY NAME/ BENEFICIARY ADDRESS

Feature and Cost

• It is secure to pay by bank wire transfer, and there are some significant and famous banks in each country, or all over the word, their service and efficiency is better than small banks.
• The transfer time is not very fast, usually 1~5days, it depends on the countries and Intermediary bank, but it will has a receipt immediately, the bank receipt can be a paper slip or screenshot, you can show them to the beneficiary as your payment proof.
• The bank TT cost is usually USD20-USD45, but usually you can choose to pay the bank cost by your side or by receiver side, or share it. Since the cost is fixed per time, it seems not expensive especially when you want to transfer a big amount money.

Tips

• Importers usually divide the payment into two parts, deposit and balance payment, then there will be two times bank fee, and since the transfer time is not immediate, you would better to consider the currency exchange rate before remitting.
• Please notice that for the beneficiary bank details, when you provide them to the bank, you can not abbreviate or miss any word of the beneficiary name, such as LIMITED can not be LTD, some banks will require the remitter to correct it before releasing the payment to the beneficiary, it will waste at least 2 days.

2 PayPal

PayPal is the most popular payment method, many users all over the word, people can associate their debit card or credit card to PayPal account, so that to pay or collect payment easily.

How to use?

• Register your account on PayPal official website.
• Associate you debit card or credit card with your PayPal account (it is an email address).
• Pay by your account online or pay to another account directly, or you can ask the seller to send you one invoice by PayPal, then you pay by the invoice on PayPal website.

Feature and Cost

• Suitable for personal use, for small amount
• No service fee on buyer side for regular payment
• Quick payment arrival for sellers
• Buyer Payment protection for eligible buyers

No service fee on buyer, and if you are curious about the seller side cost, sees below pictures.

Generally it is 3.4% – 4.4% commission+USD0.3 + each time withdrawing fee.

see this service fee image:

see this withdrawing fee image:

Tips

• The seller side cost is not very cheap, especially when your payment amount is a little big, sellers will bear a big amount commission, and sellers may require you to share the cost with them.
• PayPal protects buyer’s payment for 180days, long time protection is a risk for sellers, it may generate buyer cheat behaviors, so for many Chinese sellers, they do not like to use PayPal for big amount payment, small amount payment below USD1000 is more acceptable.

3 WESNERN UNION

WESTERN UNION is a very simple payment method, quick, convenient and reliable, however the transfer fee is not very cheap.

How to use?

• You just need to show your valid identification to your local WU cooperation bank (or online), you do not need to open a bank account, you only need to know the beneficiary information:

THE FIRST NAME, THE LAST NAME, DETAIL ADDRESS,PHONE NO.

• After remitting you will get the receipt with a NO. (MTCN: Money transfer control NO.) , send the no. to the beneficiary then he can get your money in 10mins, very quick.

For more questions, you can refer to this RFQ page:

https://www.westernunion.com/cn/en/frequently-asked-questions.html

Feature and Cost

• It can be very quick, the beneficiary can get your money in 10mins
• The service cost is not cheap and no upper limit, so it is usually for small payment, we do not recommend you to pay that for more than USD3000, because the charge will be more than Bank TT method or other payment way.
• 100% service cost are paid by sender, receiver side no charge.

Tips

WESTERN UNION do not have a buyer or sender protection, so once the receiver withdraw your money, you can not get your money back again, so before sending money by WU, please make sure that you will send to the right person, and you will get your goods without any problem.

4 MoneyGram

For the last one we want to talk about MoneyGram, MoneyGram and WESTERN UNION, they are similar payment methods, provide the same quick global money transfer service, the information that they require for the sender and receiver are the same, just their local cooperative bank is not as many as WU. But you can choose to send money online too.

For most countries, you can send up to $10,000.00 per online transfer, and up to $10,000.00 every 30 calendar days, for additional funds, you have to go to MoneyGram local agent bank.

For more questions, you can refer to this RFQ page:

https://www.moneygram.com/us/en/faq

That’s a Wrap

I hope you found this post useful, and you managed to select your proper payment methods yourself.