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Best Business FX (SME) & Corporate Foreign Exchange Services

By 
George Tchetvertakov
Last Edited Jan 25, 2023

If you own, manage, or manage the finances of a business at any size (from SMEs to larger multi-national corporations), then you should know that business FX management is crucial for you. If you have been wondering whether your business is paying too much on currency exchange or business payments, it’s almost certain that it does. Banks do service corporations using their corporate FX desks, but those services are reserved for businesses of a certain size; other sectors are oftetimes neglected.

Small businesses in the UK, USA, EU countries, Australia, HK, Singapore and many other countries are paying too much fees on inbound and outbound international business transactions, not protecting their business against fx movements, don’t optimise their business fx payments strategy, don’t have access to fully functional payment online systems but worse than all have nowhere friendly to go for guidance.

Our small business & corporate foreign exchange guide wishes to change that. We list the best business fx services and offer a market overview.

Best Business FX 🔓

#1
UK Moneycorp: Highest Level of Credibility, Best Business FX Overall
Headquarters:
Zig Zag Building, 70 Victoria St, Westminster, London SW1E 6SQ
99.4% Editorial rating
7,000 Client Reviews
Minimum transfer:
£250 or equivalent
Why Them?
  • Operating Since 1979 - First Commercial FX Firm
  • Corporate FX Specialists
  • Great Online Platform, Tailored for SMEs
  • Many Consumer and Business Awards
  • Widest Selection of FX Hedging Tools
  • Best Credit Score by D&B
Read less
#2
UK Currencies Direct: Excellent Service and Very Functional Online System
Headquarters:
1 Canada Square, Canary Wharf, London E14 5AA
97.8% Editorial rating
7,500 Client Reviews
Minimum transfer:
£100
Why Them?
  • Large Transfers and Bespoke Business Transfer Specialists with 4.5/5 Rating on TrustPilot (5,000+ Reviews)
  • Industry Leader with £10bn in Annual Turnover
  • Batch Payments and Forward Contracts Online
  • Risk Management including Rate Alerts and Forwards
  • Most Global Offices in the Industry
  • Easy On-Boarding Process
  • No Transfer Fees and Great Rates
  • Accepts Private Clients and Business Clients of Any Requirement
  • Smooth Online and System
Read less
#3
UK TorFX: Friendliest Business Currency Broker in the Industry
Headquarters:
St Mary's Terrace, Penzance, Cornwall, TR18 4DZ
93.2% Editorial rating
5,500 Client Reviews
Minimum transfer:
£1,000
Why Them?
  • Personal, Friendly Service
  • High TrustPilot Rating
  • Regular Market Updates
  • Expert Guidance by Veteran Dealers
  • Excellent Hedging Offering for Businesses
  • Property Transaction Specialists
Read less
#4
UK Global Reach Group: Excellent Client Feedback, Friendly & Professional
Headquarters:
Woolgate Exchange, 25 Basinghall St, London EC2V 5HA
90.6% Editorial rating
1,000 Client Reviews
Minimum transfer:
£1,000 or equivalent
Why Them?
  • 99% Positive Customer Feedback
  • Known for Great Currency Guidanc
  • Highly Usable and Friendly Website
  • Operating for 15+ Years
  • Result of a Merger of two Leading Companies in the Money Transfer Space, One was Fully Dedicated to Corporate Foreign Exchange
Read less
#5
Australia OFX: Best Online System for Business FX, Publicly Traded
Local UK Offices:
The White Chapel Building, 10 Whitechapel High St, London, E1 8QS
90.4% Editorial rating
1,500 Client Reviews
Minimum transfer:
£100 or equivalent
Why Them?
  • Traded Publicly on the Australian Stock Exchange
  • Massive Staff
  • Spotless Reputation for 20 Years
  • Ultra Professional System with High Level of Functionality
  • Very Tight Margins
  • Transparent Rates on the Online System
Read less
#6
UK Halo Financial: Excellent Currency Predictions
Headquarters:
Battersea Studios 2, 82 Silverthorne Rd, Nine Elms, London SW8 3HE
87.3% Editorial rating
100 Client Reviews
Minimum transfer:
£1,000
Why Them?
  • Feefo 2020 Platinum Trusted Provider
  • Excellent Website and Online Flow
  • Highly Professional
  • 15+ Years of Experience
  • Spot-On Currency Predictions
Read less
#7
UK Australia Hong Kong Singapore Worldfirst: Best MultiCurrency Account, Fixed Rates
Headquarters:
Millbank Tower, 21-24 Millbank, London, SW1P 4QP, UK
95.4% Editorial rating
7,000 Client Reviews
Minimum transfer:
£1,000/€1,000 or equivilent
Why Them?
  • Best Rates: Fixed FX Spreads of 0.1% – 0.5%.
  • Authorized by 6 Global Regulators
  • Asian Currency Specialists
  • Excellent Multi-Currency Offering for Online Sellers
  • Operating for 15+ Years
  • Owned by Ant Financial, a Global Payments Giant
  • Courteous Staff
  • Largest Selection of Currencies
  • Does not Accept USA-Based Clients
Read less

… Both of the above will be addressed below and will put a particular focus on how FX hedging works (and who can use it) and drill down into one particular hedging tool that is essential in a corporate/SME foreign exchange strategy: the currency (FX) forward, which enables businesses to lock current exchange rates for years to come and mitigate related fx risks. Don’t worry though; if you aren’t into understanding the technical bits of business FX strategy, our top-rated business payment specialists below also offer a fully managed fx treasury management service.

What Is Business FX? What Do Corporate FX Specialist Offer?

Business FX is an inclusive name for foreign exchange (foreign currency) management, payments and hedging. Corporate FX specialists, although their name might suggestion are reserved only for mega-corporations, are a sub-type of currency brokerages which offer such services (fx payments, hedging and management in the form of multi-currency accounts) to business of any size (at least the ones we have listed on our page and marked as the best business fx services).

Which Businesses Save Most Money By Using an FX Service??

Here are a few examples of the type of businesses which can benefit, and save money, by using a specialist for their foreign exchange business payments, management and hedging.

  • Businesses which are making a big purchase abroad (or are being purchased in foreign currency)
  • Businesses owned by multi-nationals with multiple bank accounts
  • Businesses that have suppliers abroad
  • Businesses that have employees aborad (to use for Global Payrolls)
  • Businesses which get paid in foreign currency
  • Businesses whose profits are impacted by foreign currency movements and wish to mitigate that
  • Businesses that need to pay a commitment in foreign currency (instalments or one-off payment in the future)
  • Business in property and especially property abroad / mortgages abroad
  • Franchise stores with branches abroad
  • Online stores and private sellers
  • Sport clubs
  • NGOs

Do I need to Use a Foreign Exchange Service?

Here are some of the more common usages business fx services can handle successfully:

  • Make one-off business payments overseas, exchange your base currency to the currency you need, while being able to avoid a SWIFT (meaning it gets there quicker and easier).
  • Make transfers to suppliers, providers, employees, affiliated companies or any other b2b overseas payment – online or via phone.
  • Do payroll payments in an automated or non-automated manner.
  • Hedge currency risks by offering sophisticated FX hedging derivatives (most importantly a Currency Forward Contract).
  • Get guidance about the best timing to make large currency exchanges for your business.
  • Make invoicing international clients smoother and cheaper.

In a post-COVID globalised village, there are many small and medium businesses who can use a business foreign exchange service, as well as corporations who can benefit from the rates and added values in corporate foreign foreign exchange. Even the smallest business, as long as it has suppliers, employees, or business partners abroad – can benefit from using the service, and avoid the cumbersomeness and archaism that banks still encompass within their international business payments experience.

In fact, the majority of the UK currency brokerage services businesses started off as strictly corporation-facing and have expanded over time into smaller businesses and private clients, understanding that the service gap and dissatisfaction with traditional high-street banking can appeal to more than just corporate customers.

For corporations, the value add versus traditional banks is easy to comprehend and convey. Some banks, even posh and trendy banks like Virgin Money, don’t even have international business payments enabled as a part of their online system. That means that corporations which are making constant international b2b payments in foreign currency are going to suffer through a lot of hassle. In addition to that, unless your corporation is big enough to meet the requirements to have direct access to the FX trading floor, you are likely to be serviced by a banker rather than an FX specialist or a corporate FX dealer, which means you are going to have far less guidance than with specialised business FX services, and not have access to FX hedging tools. In fact, the larger and more specialised brokerages offer a full on FX treasury management service.

Corporations which are looking specifically at recruiting abroad and need more of a comprehensive solution like a global Employer of Record / PEO will not find that with any of the business foreign exchange specialists listed on this page – they deal (and are regulated to deal) only with payments.

For small businsses, the main thing is savings. Getting a much better exchange rate (in addition to all of the above i.e. great service and access to hedging) is pivotal and can have a serious impact on their foreign exchange. If you look at our best foreign exchange rate comparison you could see how Worldfirst rates moves between margins of 0.15% and 0.5% of each transaction without any transfer fee, whereas Natwest Bank or Lloyd’s or even challenger bank Monese would be significantly more expensive. Virgin Bank would take a 2.5% off each transaction below £25,000 for example.

For online sellers, the key thing would have to be multi-currency accounts supplied by the best business FX providers, such USD accounts, EUR accounts, JPY accounts or AUD accounts (there are more options!) will made available to qualified businesses and sole-traders who sell online and they could send and RECEIVE payments into them. That means that they won’t have to receive payments from partners like Amazon or eBay through their own highly expensive currency exchange payment programme (Amazon can charge 4% on currency exchanges, PayPal can charge close to 5%).

Best Business FX Service

Snapshot of the top 3 services for business fx payments; Updated for January 2023
moneycorp
  • Supported Currencies: 120.
  • Clients From: Globally with offices in UK, USA, France, Spain, Ireland, Australia, HK, UAE, Brazil, Gibraltar and Romania.
  • Authorised? Yes, by the FCA.
  • Guidance / Dedicated Dealer: Yes.
  • Online System: Yes, including an app.
  • Strong Point: Credibility, Reputation, Liquidity, Level of Service, Best Credit Rating among Peers.
  • Operating Since 1979 and Maintaining Excellent Reputation Since. An Industry Leader.
  • Rating:
    4.6 /5 on Feefo
    Editorial (Corporate): 99.4%
Currencies Direct Logo
  • Supported Currencies: 59.
  • Clients From: Globally , with the exception of certain U.S states. Offices in UK, EU, USA, Canada, China, South Africa and India.
  • Authorised? Yes, by the FCA.
  • Guidance / Dedicated Dealer: Yes.
  • Online System: Yes, including an app.
  • Strong Point: Superb Service, Experienced Dealers, Batch payments, Forward contracts, Multi-Currency Wallets and Rate Alerts.
  • One of the leading currency brokerages turning over £7.5bn annually.
  • Rating:
    4.8 / 5 on TrustPilot
    Editorial: 97.8%
worldfirst-200x55-box
  • Supported Currencies: 121.
  • Clients From: Only accepts corporate clients & does not accept U.S businesses.
  • Authorised? Yes, by the FCA.
  • Guidance / Dedicated Dealer: Yes.
  • Online System: Yes, including an app.
  • Strong Point: Exchange Rate Margins of 0.25%-0.15% for Large Turnovers.
  • Trading more than $7bn each year.
  • Rating:
    9.8 /10 on Feefo
    Editorial: 91.4%

How to Choose a Business Foreign Exchange Specialist?

Each business has their own requirements unique to them when managing a foreign exchange strategy. At MoneyTransferComparison.com, we help businesses (right through the spectrum of SMEs to large corporations) optimise that strategy using dedicated provider and educating our reads the ins and outs of business money transfers and payments.

We make a concise effort to review as many providers as possible. The majority of currency brokers in UK offer business foreign exchagne services at one level or another (some will just do international business payments and multi-currency accounts like Wise). There are also very big providers like Afex which cater to corporate customers but isn’t included in our currency brokerages list because we failed to find enough online reviews to testify for the quality of its services.

How to Analyse a Corporate FX Offering?📋

✅ Safety and security: All featured providers must be FCA authorised (and authorised in other jurisdictions as per requirements).

Reputation: All business FX specialists must be operating for at least 15 years with 90%+ positive customer reviews.

✅ Wholesale rates: All companies recommended on this section offer competitive exchange rates which can save 50% or more against banks.

✅ Hedging capabilities: All corporate foreign exchange services must have a variety of currency hedging tools to lock today’s business fx rate.

✅ Guidance: Dedicated corporate FX dealer per customer, providing assistance and follow ups, guidance on hedging, and best timing to trade.

✅ Strong banking relationships and global reach: : Local bank accounts in multiple countries can process payments faster and easier.

✅ Online international business payment platform: Fully functional payment platform.

✅ Multi-Currency Account: Functionality of having a multiple bank accounts in different countries and currencies (to receive payments).

 

All Inclusive List of All Currency Services with Foreign Exchange Functionalities

This is a list updated for 2023 of all the providers we have reviewed who which offer a business foreign exchange service.

#Business FX ServiceShort Description
1Currencies DirectCurrencies Direct is a known money transfer company with headquarters in the UK and with more than 20 offices worldwide, offering private and business currency transfers online, via telephone and through a mobile app.
2TorFXTorFX is a Cornwall-based award-winning company that prides itself in its traders high level of professionalism and bespoke currency service.
3MoneycorpMoneycorp is perhaps the most trusted name in currencies – operating since 1979, and transferring as much as £20bn annually, with the most diverse offering for businesses clients (hedging and payments).
4Global Reach GroupGlobal Reach Group is a merger of two of the most famous names in currencies – FCE Exchange (private customers) and Global Reach Partners (corporate FX). The outcome is a larger with a very diverse offering, which has remained customer-friendly.
5Currency SolutionsCurrency Solutions is a smaller UK-based brokerage, with offices domestically and in Cyprus, holding a 99% client satisfaction rating on TrustPilot reviews.
6OFXOFX is Headquartered in Australia and publicly traded on the ASX. It’s one of the best known names in the business and has a pristine reputation and transparent pricing.
7Halo FinancialHalo Financial is another top-rated smaller brokerage with excellent service and very high satisfaction rating to attest for that.
8WorldFirstWorldFirst offers the best international money transfer rates bar none, but it’s offering is limited to online sellers and businesses. It’s a well known company with a lot of built in functions such as a multi-currency account, which is owned by Ant Financial (Chinese Conglomerate).
9Wise (TransferWise)Wise (TransferWise) is the most recognisable name today in the money transfer business. The company has recently went on an IPO reaching more than £10bn in market cap. Wise is the biggest international money transfers provider in the world (which offers strictly bank to bank transfers, not including large remittances providers).
10CurrencyFairCurrencyFair is an innovative money transfer provider with a unique online system that can reach razor-sharp rates. The company has won multiple industry awards and is regulated by the Central Bank of Ireland.
11PayoneerPayoneer truly comprehensive and unique solution for b2b and b2c payments, which includes a branded MasterCard and a multi-currency account (along many other business-oriented functions).
12AirwallexAirWallex is a cross border business payments startup with a focus on its payments API. A recent valuation shows Airwallex has reached unicorn status.
13SpartanFXSpartan FX is a boutique firm – Currency Cloud based, which focuses on a solid service and online trading system. With SpartanFX you can also get a “private Iban account” to receive payments.
14Key CurrencyKey Currency is one of the most well known up-and-coming international money transfer services in the UK. It boasts a clean website, good user reviews and growing recognition.
15KantoxKantox is a smaller foreign exchange company which is focused strictly on businesses. Its main selling point is transparent, tight, margins.
16CurrencyUKCurrencyUK has been awarded the Best Money Transfer Provider by the British Bank Awards in 2018, and is a prominent money transfer company / brokerage in the UK.
17PrivalgoPrivalgo is a relatively small and new UK money transfer service. Its early indications are positive and it appears trustworthy.
18Hargreaves Lansdown International PaymentsPublicly traded Hargreaves Lansdown is one of the most recognisable non-bank financial providers in the US. As a part of its array of financial services, it also offers cross-country cross-currency payments.
19FairFXFairFX is a publicly traded company which is best known for its prepaid travel money cards, but also offers an international money transfer service.
20Smart Currency ExchangeSmart Currency Exchange is a veteran UK money transfer service. It has great feedback across the board by clients that have used it, good rates, and an overall good level of reputation in the industry.
21AzimoAzimo is a leading remittances providers in the UK and Europe which boasts a new competitive pricing plan and 90% satisfaction from customers across tens of thousands of reviews online.
22PureFXPureFX is a standard UK-based money transfer company offering all the “plain vanilla” functions you could expect. PureFX is smaller in trading volumes and staff than many competitors.
23Currencies.co.uk (Foreign Currency Direct)Foreign Currency Direct is a well known UK currency transfer firm with both a private and corporate desk. The company has been set up by ex-directors and ex-managers at rival Currencies Direct.
24FlashFXFlashFX is an innovative Ripple-network money transfers company based in Australia with good user reviews but sub-par rates which is still relatively small and unknown.
25Natwest Bank’s International PaymentsNatWest is one of the 4 large UK clearing banks. It has bad customer reviews online, and its international money transfer service is expensive.
26Foremost Currency GroupThe Foremost Currency Group is a relatively small, UK oriented, FX money transer provider. Great reviews by clients, but very limited reach and selection of currencies.
27XE Money TransferXE Money Transfer is XE.com’s money transfer services. XE is a known brand with strong presence in both the UK and the USA, and positive responses from customers. The firm is owned by EuroNet WorldWide and is a merger of XE’s money transfer services and HiFX’s.
28Voltrex FX (VFX)VFX Financial is a rather large provider of international money transfers and business foreign exchange services. Its previous name was VoltrexFX. The company has won multiple awards.
29EasyFXEasyFX was a small and unknown currency transfer firm which is now focused on travel money cards.
30Vorto Trading Money TransfersVorto Trading offers a particular focus on business clients, a slick online platform, and many options for business customers.
31FrontierpayFrontierFX is a relatively small size FX company with 50 employees and expertise on both corporate and private clients.
32FinGlobal ForexFinGlobal of the biggest South-African money transfer companies.
33Cambridge FXCambridge FX is a known company particularly in the business money transfers space, with 25 years of strong reputation.
34Caxton FXCaxton FX is a smaller money transfers specialist with overwhelmingly positive feedback from clients
35Collinson & Co FXCollison & Co is a NZ based financial service provider which also offers a money transfer service.
36Sable International FXSable International FX is one of the few South-Africa focused, and based money transfer companies in the world.
37Lloyds Bank International PaymentsLloyd’s Bank is one of the “Big Four” UK banks, founded in 1765 with more than 45,000 employees. Its international money transfer rates are higher than of those of a specialist foreign currency exchange specialist.
38Starling Bank Money TransferStarling Bank is one of the most hyped challenger banks in the UK. It has an amazing online website and app and has secured hundreds of millions of pounds in investments. Its currency transfer services are limited and more expensive than those of a broker.
39Currency IndexCurrency Index Boutique firm with limited functionality but an excellent service.
40kbr FXkbr FX is a UK based money transfer company with little information about it online, and no customer reviews to attest for its service.
41DynaPayDynaPay UK is a highly technological business-oriented money transfer company.
42Alpha Group (AlphaFX)Alpha FX is one of the biggest corporate foreign exchange firms in UK. Publicly trading at a market cap of £800m.

 Please note: foreign exchange companies are not online payment processing gateways. They can be used to send and receive bank payments: b2b payments abroad, or receiving money from a business abroad. They cannot be used as a direct mean to accept payments from customers.

 

Small Business Foreign Exchange Survey

Key findings from a UK-facing survey conducted in 2016 by WorldFirst, one of UK’s best rated foreign exchange companies for business, dealing with FX are available below. A lot has changed in the world over this time span, but it is difficult to find additional credible sources. We believe there’s a reason to believe there are more UK corporations and small businesses which are using specialist business fx providers than in 2016.

The survey found that:

89%

Of the businesses using a currency specialist would recommend other businesses to use its services, against 35% of SMEs using banks who would recommend it.

24%

Less than one-quarter of UK-based companies are aware that they have a bank alternative in the form of a corporate currency brokerage. This is why 8 out of 10 businesses still use banks.

83%

Of all small business clients claim that their foreign exchange payment provider is cheaper than their bank.

45%

Of the property businesses in the UK have been let down by their banks’ FX services at least once.

Types of transactions supported by Business Foreign Exchange specialist firms:
  1. Spot FX
  2. Multi-Currency Accounts (receiving business FX payments)
  3. Forward Currency Contract
  4. FX Swap
  5. FX Limit Order
  6. Other Hedging Tools
  7. In some cases, and only for hedging purposes those hedging tools include FX Options.

🔥 6 Tips to Maximise your Business Foreign Exchange & International Business Payments 🔥

Here are 6 absolutely critical factors to consider before making a contractual commitment to exchange one currency for another, based on the experience of George Tchetvertakov, a 10-year veteran in the foreign exchange space. His diverse experience includes editorial and writing roles in publications such as Finance Magnets, alongside roles in FX firms like Head of Market Research at Alpari UK and Business Development Executive at Moneycorp UK.

Know who you are dealing with

Before getting overexcited about the ultra-competitive currency transaction rate you are being offered, you may want to ask the question, ‘With whom am I doing business?’.

In the corporate foreign exchange world, this question carries a lot more traction and will take you a lot further in search of a reliable corporate FX broker. The not-so-often-spoken truth about foreign exchange at all levels is that entities often do business under the financial authorisation of another entity, under so-called ‘affiliate’ or ‘white-label’ agreements, depending on the FX niche in question.
To ensure that you know the full story of the company to whom you will be potentially transferring millions of dollars with the expectation of a currency exchange, make sure you carry out a full due diligence check on the company you have earmarked and check its financial market status through our website.

Each business money transfer provider will also have their own banking partners whom they hold their accounts with, purchase currency and use for business payment delivery. It’s important to understand which bank partners your FX provider works with and if these are reliable too, before making a call on the best business FX service.

Timing is everything

This is an obvious one that’s often forgotten. Many corporations jump into conducting a currency transaction  with a spot transfer when needs demand it, rather than when it’s most advantageous to do so and utilising a forward contract.

This usually comes down to an oversight or simply being faced with unforeseen circumstances, or merely being ignorant that better rates even exist. This can be simply removed from the equation by having a reliable and proactive fx provider already waiting, having completed the account-opening process beforehand.

The Ins and Outs

Knowing exactly what has been (or is about to be) contractually agreed is important, as is knowing exactly what the expected currency transaction will look like. Keeping a close eye on the specifics of the deal, such as currency exchange rate, due date, country where nominated bank account is held, and associated bank fees is essential to the deal maintaining legal integrity and for costly clerical mistakes to be avoided.

In modern times, recommended business foreign exchange operators routinely offer online portal functionality, allowing corporate users to log in and track all the details of their transactions. Being able to use and understand these tools can be more difficult than first believed, however, especially if the corporate entity does not routinely engage in financial market transactions. Have an explore through your providers online portal and set-up (but don’t complete!) test payments of varying amounts to better understand the fees involved for say a £10k international business payment vs a £1m payment.

It is easy to forget that currency transactions with some brokers are filled with jargon that may not be easily understood by firms outside of the financial services industry. For this exact reason, we have established MoneyTransferComparison.com, which does all the hard work for its readers.

Mitigating risk, reducing the cost

What a corporate FX B2B payment can cost is not solely limited to the commission fees that have been agreed upon. There are also tangible and intangible costs that all businesses, regardless of size, should consider when conducting a currency transaction.

Of the tangible variety, there is a transaction cost in the form of commissions or flat fees, including as-yet-unseen bank charges. There is also the possibility of interest-bearing charges upon late delivery (particularly in the case of regular international business payments).

In the intangible corner, there is an outside chance of a international currency provider not being able to carry out the transaction, despite the agreement made. This could well mean legal expenses and delays in obtaining the expected funds, or any funds at all.

It cannot be emphasized enough how important due diligence is when opening a currency account — especially corporate accounts where many of the protections afforded to private individuals are not forthcoming. Meanwhile, operators of start-ups and small-sized businesses often make the mistake of acting as a corporate entity, believing they have the commercial rights of an individual.

The larger the expected volume of trading, the larger the risk mitigation should be in the form of professional due diligence.

Relative or absolute

The best business currency rates do not always come from the same fx company. Very often, one provider will have the best rate one day, and another will have it the day after. Therefore, one consideration worth making is asking just how competitive your current rates actually are. This may be routine for financial sector firms, but for real-estate agents, import/export companies and shipping agents, as just a few examples, currency exchange rates are often a late afterthought without forward-planning and taking into account alternative means of obtaining the right currency at the right time.

Banks aren’t always so bad, sometimes

One of the prime reasons many businesses switch their corporate currency exchange solution from their bank to an alternative provider is cost. However, using third parties for currencies carries unforeseen risks, deep considerations and potentially additional steps to obtain the same peace of mind that banks arguably provide. Therefore, to finish this list of things to consider, one consideration may simply be that your existing banking service may not be so bad after all.

It all depends on the type of business you have, transaction size, frequency and currencies required. However, determining which option is best can only be done after some mindful thinking and careful consideration of all the factors surrounding foreign exchange dealings that specifically apply to your business. The rule of thumb will dictate that if your business is large enough, you could potentially get the same rates and fees directly from your bank, and get direct access to the trading room. If you are an SME, a corporate foreign exchange solution is likely to be your best choice especially if you can leverage the technology for payment automation.

Corporate Client Experiences

How Did Moneycorp Help my Small Business?
On an annual basis my client imports over $1.5M of goods from China so the effect of not managing their currency exposure can be very harmful to the business and in the past currency has mainly been bought at the spot rate.

My advice was to manage the exposure particularly the downside risk of currency falls especially with a possible Brexit on the horizon, so we invited three companies including their current bank to talk to us about their different products and the service that they can provide. There wasn’t a vast difference between the rates that they all offered although moneycorp was the best, but what was evident was the advice of what products were available was quite clear and the ease of setting up the account was trouble free.

On a day to day basis Barbara is available at the end of the phone if we need her but the usability of the system is very good so we don’t have to contact her that frequently. So overall, good products at a good price, backed up with a system and service that makes the currency management trouble freeAndrew (Business Advisors), 28/07/2016

– Andrew’s testimonial is verified. He uses Moneycorp as his currency provider.

How Does Hedging Work in Corporate Foreign Exchange?

A main task for a firm  is to minimize (hedge) risks that are not necessary for the performance of the business. Among the different types of risk lies a very important one that can jeopardize the financial health of any global company: Foreign Exchange Risk. As currencies fluctuate and as markets increase in volatility, it becomes very difficult to predict the future and gain stability in terms of inflows and outflows. For this reason, more and more companies are hedging their future cash flows and stabilizing the rate at which they will exchange currencies in the future.

badreThisThis short write-up about currency hedging and our full FX hedging guide was composed by Badre Bouarich, a former Trader and Multi Asset Structurer (Forex, Interest Rates) at HSBC bank in London & an expert Financial Writer.

As the derivatives market has developed and as counterparty risk became mitigated through clearinghouses, hedging possibilities have widened, making it possible to reasonably hedge cash flows due in the next 1-3 years horizon. Now, there are different instruments that will enable you to achieve your desired objectives – although a thorough understanding of the products involved is necessary.

Forward Transactions – Simple and Total Hedge
Forward Transactions – Simple and Total Hedge

Limit Orders – Flexible though partial
Limit Orders – Flexible though partial

Stop Loss Orders – Hedging and keeping upside possibilities
Stop Loss Orders – Hedging and keeping upside possibilities

One Cancels Other Orders – Limiting both upside and downside
One Cancels Other Orders – Limiting both upside and downside

There are additional tools to the vanilla 4 orders presented here, such as a Time Option, which is fully hedged.  And participating forwards, which allow some upside vs your standard forward contract. Again, commercial corporate FX companies will make tremendous efforts in order to inform you about market developments, along with the most adapted instruments to use. Moreover, they will give you access to a set of hedging instruments that banks will provide only for the largest corporations. It’s very important to understand each hedging tool so you are completely aware of any potential downside risk and why you are required to pay a premium when agreeing to an option, if indeed it incurs a fee.

Few SMEs are Using Currency Forwards and Options Contracts

Research from East & Partners demonstrates the link between the size of the business and their tendency to utilise FX forwards and currency options. Micro businesses are less likely to use options than SMEs, who, in turn, are less likely to use options that small corporations.

Source: www.eastandpartners.com/research/research-programs/global-business-foreign-exchange

One of the big advantages of working with a dedicated business FX broker is that they make a range of foreign exchange instruments available to SMEs. The type of instruments that banks only make available to large corporations. Just because a business is smaller in size, it shouldn’t mean they’re unable to access hedging instruments that can help to protect against exchange rate risk. As always, caution should be taken ahead of agreeing to a foreign exchange option and customers should be 100% aware of the legally binding contract they sign.

Should You Go for Large or Boutique?

Here on MoneyTransferComparison, we have tested and rated a variety of business FX solutions. Some of these had a significant amount of customer complaints (like Western Union), some aren’t specifically geared for businesses (like Azimo, which has been bought and repurposed in 2022), and some offer some strong offering for for businesses, including diverse multi-currency accounts, but don’t offer the type of service we recommend services to get (like Transferwise which more of an online service than a currency brokerage).

Even so, there are more than 10 other companies that provide corporate foreign exchange management services that we do recommend. The main differentiation between them is their size.

Larger Service Providers

Higher trading volumes, more employees (both sales, marketing and dealers), and more offices across the globe. These typically are headquartered in London.

Advantages: Get better rates than smaller companies and thus the haggling space on the spreads they take could be  smaller. These companies have a lot of experience dealing with thousands of businesses in varying sizes in different markets. They usually have higher global reach than smaller firms, and local presence in countries which enables them to handle complicated transactions better. Plenty of testimonials to attest for their quality of service from fellow business owners.

Disadvantages: Though the staff is professional, as a small business you are not likely to be dealing with the head dealer.

“Boutique” Currency Services

Lower trading volumes, fewer employees, and usually fewer than 5 offices (where oftentimes there’s only a single UK office).

AdvantagesOften provides a higher level of expertise from currency dealers. Extremely service oriented. They need your business to work with them, and are therefore willing to offer tighter spreads.

DisadvantagesUsually don’t accept US-based businesses. Have fewer corporate clients, so some scenarios could be unprecedented. Lower global reach (dealing with fewer currencies, less likely to circumvent SWIFT). Less testimonials to their services than with larger firms – less reputable even if they have a clean history and properly regulated.

Why do we prefer the major competitors in the business FX space?

We suggest that larger multinational corporations stick to the larger business fx companies (preferably, one from the 10 best money transfer for businesses list). After all, they need a company that can handle these large transactions efficiently and have been doing so for a long while. The risk with large transactions does exist – as currency transfers are not insured – and if a company goes bankrupt, you could be getting hurt (although client accounts are separated from the company’s accounts by FCA instruction).

For smaller businesses, if you prefer to manage FX yourself and just require a good online platform than a larger broker could also be suitable for you. However if you prefer to receive dedicated dealer guidance and further understand your hedging strategies we suggest trying one of the smaller firms. They could be more willing to give you  better rates and more tailored services than larger firms. Smaller businesses can also get dir

The Conclusion – Business FX and Payments Overview 2023

Within a global macro-economic conjuncture that is characterized by transition and instability, businesses have been facing a growing number of risk-bearing factors. Nevertheless, this climate has also created a tremendous number of opportunities for businesses willing to open up, take the extra step and explore global marketplaces.

As a consequence, business fx payment flows have sky-rocketed and it has become critical for business owners and managers to optimise their cross-border transactions, while turning potential risks into value-adding elements. An international business to business payment conducted via one of the best business fx providers,  which specialises in business clients, is a superb choice that a small business owner or a company’s money manager, can make.

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