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Receiving payments in Europe from US
Thread poster: Nicholas Stedman

Nicholas Stedman  Identity Verified
Italy
Local time: 23:12
French to English
Apr 12, 2016

A new US client tried to pay me by bank transfer and told me that "the funds were denied" (by my bank) and sent back to their account! In the end they sent a cheque which cost me an hour of my time to take to the bank and €40 total bank charges. I regularly receive other bank transfers from US clients although I have had this problem before with another US client. Is there something particularly difficult about receiving wire transfers in Europe from the US? What is the best and cheapest way of receiving payment from American clients. Thanks for advice

 

Serena Basili  Identity Verified
Belgium
Local time: 23:12
English to Italian
+ ...
. Apr 12, 2016

I've recently got paid by a client in the US via bank transfer and had no problem at all....maybe you should take some time to go to your bank and figure out why they send the wire transfers back.

 

Sheila Wilson  Identity Verified
Spain
Local time: 22:12
Member (2007)
English
+ ...
Ask client for evidence? Apr 12, 2016

I can only imagine they failed to correctly identify the receiving account. I imagine they were given some reason, and there will have been some paperwork exchanged. I would ask to see that so you can together find out how to make future transfers work. Accepting a cheque is not something I would personally do. PayPal isn't my favourite payment method but it's generally cheaper than €40 and you can choose to keep the money in dollars until you find something you want to spend them on.

 

Siontrans
Greece
Local time: 00:12
Member (2014)
English to Greek
intermediary/correspondent bank Apr 12, 2016

You may need to provide an intermediary/correspondent bank. You may ask you bank for this information.
Sion


 

Thomas T. Frost  Identity Verified
Member (2014)
Danish to English
+ ...
Cheque Apr 12, 2016

I wouldn't have accepted the cheque either. The fees are simply too high. I'd have asked for information and evidence in both ends. Did you provide the client with your BIC, IBAN and account name? If you run your business as a type of limited company, the account name and the name on the transfer should be in that name, not your personal name.

And next time, I would ask the client to use TransferWise. It's cheaper and faster.

PayPal cheaper than $40? For small amounts, yes, but they take up to 8 %, so from $500 and up, it can get really expensive. TransferWise is still a much better choice when available.


 

Nicholas Stedman  Identity Verified
Italy
Local time: 23:12
French to English
TOPIC STARTER
Thanks for your helpful comments Apr 12, 2016

and I will try and find out why this bank transfer failed whereas others have worked with the same IBAN each time. I will look into Transfer wise. Otherwise I may open a dollar account here just for this client as perhaps it was refused as the invoice was in dollars rather than Euros.

 

Thomas T. Frost  Identity Verified
Member (2014)
Danish to English
+ ...
I doubt it Apr 12, 2016

NR_Stedman wrote:
perhaps it was refused as the invoice was in dollars rather than Euros.


No, the bank would convert it to euros.

As for the beneficiary having to provide the name of an intermediary bank, I always thought that was the remitting bank's job. I've never had to do that, but maybe some banks can't be bothered.


 

Tomás Cano Binder, BA, CT  Identity Verified
Spain
Local time: 23:12
Member (2005)
English to Spanish
+ ...
Exactly Apr 12, 2016

Siontrans wrote:
You may need to provide an intermediary/correspondent bank. You may ask you bank for this information.
Sion

This is usually the cause. Asking your bank for their correspondent in the US usually solves the problem.


 

Jean Lachaud  Identity Verified
United States
Local time: 17:12
English to French
+ ...
Wrong data used? Apr 12, 2016

Since I appear to be the only one actually living in the USA, let me add my 2 cents:

Except a few major banking institutions, US banks are notoriously provincial, and have little experience with respect to international wire transfers.

Correspondent banks are the paying bank problem, not the customer's.

Also, US banks are NOT part of the IBAN network and DO NOT USE IBAN numbers. For international transfers, they use the Swift number of the foreign bank.


 

Thomas T. Frost  Identity Verified
Member (2014)
Danish to English
+ ...
SWIFT, BIC and IBAN Apr 12, 2016

JL01 wrote:

Also, US banks are NOT part of the IBAN network and DO NOT USE IBAN numbers. For international transfers, they use the Swift number of the foreign bank.


SWIFT is just another name for BIC.

Even though the US doesn't use IBAN numbers, the remitter will still have to provide a valid IBAN so the transfer can be routed correctly and automatically once in the euro system. As the IBAN also contains the same information as the SWIFT/BIC, the latter is in fact redundant for SEPA payments, but in banks not used to international payments, it's better also to provide the BIC/SWIFT.

As you say, some US banks have little experience with 'rest of the world', and that's another good reason to use a specialised transfer service such as TransferWise.


 

Jean Lachaud  Identity Verified
United States
Local time: 17:12
English to French
+ ...
should, have to, must. Yeah, right. Apr 12, 2016

Just because what you say is correct and reasonable will not change the US banks or businesses way of doing business.

Precious few US companies will go out on a limb and attempt an unknown-to-them service provider (TransferWise or other) as opposed to their banks.

Out of curiosity, I asked my bank (Citibank) a few days ago about bank charges for bank transfers: inside the USA, the bank charges $25. I don't even remember the cost of international wire transfer ($35? $40? $50), since this is one of the major reasons I don't work with European customers.

Out of curiosity, here is a question to the original poster: in what US state is that agency located?



Thomas T. Frost wrote:

SWIFT is just another name for BIC.

Even though the US doesn't use IBAN numbers, the remitter will still have to provide a valid IBAN so the transfer can be routed correctly and automatically once in the euro system. As the IBAN also contains the same information as the SWIFT/BIC, the latter is in fact redundant for SEPA payments, but in banks not used to international payments, it's better also to provide the BIC/SWIFT.

As you say, some US banks have little experience with 'rest of the world', and that's another good reason to use a specialised transfer service such as TransferWise.


 

Maxi Schwarz
Local time: 16:12
German to English
+ ...
I've had reverse problems on occasion Apr 12, 2016

I noticed that Thomas, who is located in Germany, wrote about " BIC, IBAN".
I'm located in Canada. On occasion clients in Germany have had problems with bank transfers because at least one of these codes (BIC?) is part of a system used within Europe, but not in North America. So their banks will go into a loop asking for the BIC or IBAN, or both, and since we don't have such a system over here, they can't get any further. Other clients' banks seem to be able to manage it. Yes, SWIFT is our rough equivalent to one of them, but in some German clients' bank branches, that's not good enough. I think we circumvented using Paypal.

By chance the only European clients I've gotten were from Germany, so I don't know whether this is prevalent in other countries such as France, Switzerland, etc. I have no problems getting bank transfers from the Orient. I've been dealing with one steady client located there for years.


 

Nicholas Stedman  Identity Verified
Italy
Local time: 23:12
French to English
TOPIC STARTER
Had same problem with US client before Apr 12, 2016

[quote] Out of curiosity, here is a question to the original poster: in what US state is that agency located?
California

[quote]
Just because what you say is correct and reasonable will not change the US banks or businesses way of doing business:

Precious few US companies will go out on a limb and attempt an unknown-to-them service provider (TransferWise or other) as opposed to their banks.

Yes that's the feeling I got, a bit of bloody mindedness from my client


 

Thomas T. Frost  Identity Verified
Member (2014)
Danish to English
+ ...
Then what? Apr 12, 2016

JL01 wrote:

Just because what you say is correct and reasonable will not change the US banks or businesses way of doing business.

Precious few US companies will go out on a limb and attempt an unknown-to-them service provider (TransferWise or other) as opposed to their banks.

Out of curiosity, I asked my bank (Citibank) a few days ago about bank charges for bank transfers: inside the USA, the bank charges $25.


TransferWise was a suggestion for those who are not afraid of trying new things, but I know very well some are. After all, we use the Internet to supply translations today, not paper and post.

But how are we supposed to do business with the US if the banks can't figure out how to make international transfers, and the clients don't want to do anything else than what they have always done?

TransferWise is backed by people like Richard Branson, by the way, and I think even a few people in the US have heard about him.

TransferWise told me recently they accept payment by credit card. Hence the client can skip the cumbersome and expensive domestic US bank transfers. But if they don't want to use credit cards either, then we're no further.

JL01 wrote:

I don't even remember the cost of international wire transfer ($35? $40? $50), since this is one of the major reasons I don't work with European customers.



If you have European customers, then they won't have to pay American transfer fees but European ones, and they can vary from €4 (Luxembourg, and no, it's not a typo) to some £30 (UK) in ordinary banks. Plus the intermediary bank fee and any domestic fees in the US. Again, by using a specialised transfer company, costs can be trimmed.

In any case, it's always wise to settle the questions of payment and fees before work commences. At least many US banks do manage to handle international transfers correctly.


 

Thomas T. Frost  Identity Verified
Member (2014)
Danish to English
+ ...
It varies Apr 12, 2016

Maxi Schwarz wrote:

I noticed that Thomas, who is located in Germany, wrote about " BIC, IBAN".
I'm located in Canada. On occasion clients in Germany have had problems with bank transfers because at least one of these codes (BIC?) is part of a system used within Europe, but not in North America. So their banks will go into a loop asking for the BIC or IBAN, or both, and since we don't have such a system over here, they can't get any further. Other clients' banks seem to be able to manage it. Yes, SWIFT is our rough equivalent to one of them, but in some German clients' bank branches, that's not good enough. I think we circumvented using Paypal.

By chance the only European clients I've gotten were from Germany, so I don't know whether this is prevalent in other countries such as France, Switzerland, etc. I have no problems getting bank transfers from the Orient. I've been dealing with one steady client located there for years.


Such problems would vary from bank to bank. Some French banks are unable to handle 8-character BICs even within the EU even if the format is perfectly valid, for example. That was also the case in the German branch of a French bank I used before.

How user-friendly a bank is when it comes to transfers out of the EU varies a lot.

Both Canada and the US use SWIFT/BIC codes (http://www.theswiftcodes.com/canada/ - https://www.swift-code.com/united-states/ ), and SWIFT and BIC are just synonyms (https://en.wikipedia.org/wiki/ISO_9362).

IBAN is mainly used in the EU, but if a bank requires that for payments to the US or Canada, they must be more than incompetent. I'd find another bank if the one I used were unable to handle my transfer needs.


 
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