Sending and receiving cross-border payments is one of the most costly and complicated challenges for SMEs. Aside from the fees involved in moving money from one place to another, businesses often incur high exchange rates and suffer delays when receiving funds from abroad.
In the Philippines, where SMEs represent a whopping 99% of all businesses, a solid international payment solution is crucial for the health of the local economy. In the last year alone, business-to-business payments in the Philippines were estimated at 31.9 billion USD, or roughly 1.51 trillion PHP.
Let’s Talk Payments (LTP), an international FinTech content and research firm, recently conducted an independent analysis comparing the different methods and costs of transferring B2B payments to the Philippines from the United States.
Let’s Talk Payments tested two scenarios for receiving payments in the Philippines:
1) Direct Transfer from International Client
LTP tested transferring the same sum of money from a US business to a business or professional in Philippines via the 3 most popular options:
Compared factors: fees, processing time, fees, currency conversion fees and ease of use.
2) Payment from Freelance Marketplace
As before, LTP investigated the 3 most popular methods for withdrawing earnings from a freelance marketplace:
Landing fees and conversion costs were compared to reveal which option provided the Filipino business with the most PHP at the end of the process.
Payoneer was found to offer the lowest fees, reducing costs for Filipino businesses by up to 58%. Payoneer was found to be the most affordable option for both direct and marketplace fund transfers.
Based on Let’s Talk Payments’ findings, the Payoneer platform has:
The final sum received on the Filipino side was much higher when using Payoneer, compared to PayPal and bank transfers.
To learn more, download the full report.