5 ways to receive global payments in Hong Kong
When it comes to accepting payments for your products or services worldwide, it can be tricky to know what the perfect solution for you is. Each payment gateway can charge a different fee or have additional payment regulations that may cause difficulties for specific industries. It is important to know your options so that you get the best outcome for yourself or your business when you choose your primary payment solution.
Check out our guide to the top 5 ways to receive global payments in Hong Kong.
1. Multi-currency accounts
Multi-currency accounts are exactly what they sound like — they enable you to receive and send money in more than one currency. This allows payments to flow in and out of businesses without additional fees for exchanging money.
Neat is one such company, allowing users to make global payments to Hong Kong, mainland China, the USA, the UK, and many others, while housing funds in multiple currencies all in one account.
Better yet, by hooking up your Neat accounts with Xero, all your incoming, outgoing, and transferred payments can be tracked and recorded automatically.
In addition, unlike the options below, you can obtain corporate cards, both physical and virtual, to allow your staff to make purchases and record expenses.
PayPal acts like a regular bank account, with some of the functionality of a multi-currency account. For example, when you set up a PayPal account, you will define your location and your local currency. Once done, you can make and receive payments online.
Should you receive an overseas transaction, you can choose to keep the currency held in its original format or convert it to your local currency so that you can withdraw it. If you decide to hold on to it and later want to make an online payment in that currency, you can do so from these reserved funds.
However, PayPal is quite expensive as a payment provider. Although free to set up, receiving payments via PayPal can cost between 1.2% and 3.5% of the incoming funds, plus a fixed fee.
While PayPal is one of the most widely used payment methods online, not everyone chooses to use it. Although PayPal will allow non-members to use a credit or debit card to make a payment, the process is clunky and pushes them towards creating an account, which can put some buyers off.
3. Alternative Online Payment Gateways
PayPal has the power of its size behind it, which means it has little impetus to reduce its fees or improve customer services. This allows opportunities for other payment gateways to make a name for themselves. Some have opted to differentiate themselves by being cheaper than PayPal and traditional banking, especially for smaller transaction amounts (below $1000). Some charge little or no exchange rates.
The technology behind some of these payment gateways allows for easy-to-use apps, or slick accounting integration, as we described for Neat. Some of the best options currently on the market include:
Stripe: Stripe is a growing payment system with an easy to use website. It works seamlessly on websites to take card payments and can send out invoices with links to make payments, which is a nice feature. It charges a flat rate of 2.9% + $0.30 per transaction. For international transactions, a 1% conversion fee applies.
Google Pay: This secure payment method, backed by the search engine giant, is growing in popularity and has no fees.
Payoneer: Customers can pay businesses that use Payoneer without the merchant incurring any fees. The gateway can also accept credit or debit card payments for a 3% fee.
4. Money transfer specialists
Banks can send money to other banks, of course, but these tend to be expensive transactions, where the sender has to lose out on the exchange rate, plus a sizable set fee for the service.
This is where money transfer specialists come in. Companies such as World First, TorFX, and Western Union are the most well-known companies that provide the service, but there are others.
They do the same thing as a bank – you tell them where you need the money sent to, and they take payment from you and transfer it to its destination. The fees are typically low, with better exchange rates and excellent customer service. However, sometimes minimum transfer amounts apply, making small payments impractical or impossible. You also typically need to provide cash as your payment. The transfer does not include foreign currency exchange, so the receiving company will need an account that allows them to deposit foreign currency, which somewhat misses the point.
Accepting payment in a cryptocurrency, like Bitcoin, can be an interesting option if you like to speculate. It is a somewhat complex set-up, but if you and the customer are both up to the challenge, you can receive payments globally in one of many cryptocurrencies.
You would need to use an exchange like Coinbase to convert the cryptocurrency into fiat (i.e., real-world) currency. Is it worth it? Well, it allows payments to be transferred quickly and relatively cheaply. However, care must be taken when accepting cryptocurrency in Hong Kong. Businesses looking to buy, sell, or trade cryptocurrencies must be licenced by the Securities and Futures Commission. This licensing can have significant cost implications for organisations looking to use crypto to process global payments in Hong Kong.
So, there we have it. What do you think of our round-up of payment options for international payment methods? Did we miss one that you feel is worth adding to the list? Let us know!
Get a taste of Neat
Neat offers a modern account that suits all your financial needs. If you’re looking to engage in international commerce, sign up for a Neat Business account to get a multi-currency account, seamless international transaction solutions and corporate cards with year-round 1% cashback and more.
Having doubt? Book a time to talk to one of our product specialists today.