How to pay an international invoice

If you have an Australian business, the chances are that you’ll need to pay suppliers, contractors or staff from time to time in foreign currencies. Whether you’re buying stock, paying a freelancer for project support, or managing a regular payroll internationally, the costs can mount up - particularly if you’re hit by a bad exchange rate on your overseas transfers.

The good news is that there are plenty of different options for paying international invoices from Australia. This guide examines how to pay using your business bank account - and some alternatives which may be cheaper and more convenient, like using Wise Business to make and receive international payments with low costs and great rates.

Understanding your international invoice

If you’ve been sent an international invoice by a supplier, the first step is to make sure you’re clear on what they’re asking for, including the payment details. Invoices tend to follow a fairly standard format all over the world, to allow for easier reconciliation and bookkeeping - but if you get an invoice from abroad there may be some additional information compared to an invoice from an Australian supplier.

Generally, the information included on your international invoice is likely to show:

• Invoice number: For easier record keeping and reconciliation, international invoices will usually be sequentially numbered, and may also have a purchase order number depending on the supplier’s process
• Supplier name: The issuer of the invoice will include their name, address and contact information for any follow up questions of issues, and to help with processing the payment
• Payment account information: The supplier will include the information required to process the payment, which is likely to include a bank account number or IBAN, bank name, bank BIC/SWIFT code and any local information based on the country involved
• Currency: As international invoices may be settled in different currencies, the agreed currency for payment must be detailed on the invoice to avoid misunderstandings
• Payment due date: The due date must be shown on the invoice - bear in mind that international payments can take longer than local transfers, so you will need to give adequate time for the payment to settle
• Item descriptions and costs: As on any invoice, the items purchased will be detailed, with description, unit costs and numbers
• Other charges: International invoices may include tax, shipping charges and other costs which are paid by the purchaser, and which can vary based on the country and type of product or service being sold
• Total amount to pay: A final sum amount, including the currency of payment, should be clearly shown on the invoice

There are a couple of points to note about paying an international invoice, which may be different to paying a local invoice in AUD. If you’re sending money overseas, you’ll need to bear in mind the potential additional costs on your side, which can come with managing foreign currency payments. These costs can include transfer fees and exchange rate markups. Finding the cheapest possible payment method is important to avoid eating into your profit margins.

When you come to pay your invoice, you’ll also need to take note of the banking information you’re provided, as this may be different from the information needed to send a payment in Australia. You’ll usually need the bank’s SWIFT/BIC code, for example, and some countries also have additional requirements, such as a sort code for the UK, or a routing number for the US. You’ll need to ensure you have all of the details needed for your payment to be processed securely, and to avoid unnecessary delays.

How do Australian businesses invoice internationally?

Paying your overseas suppliers is only one part of the picture - in many cases you’ll also find you need to invoice customers abroad yourself.

Getting paid from overseas doesn’t have to be a headache. You can create sleek and professional invoices using an invoice generatortool which allows you to enter the required currency to be paid from overseas. Then, you'll be able to receive payments to your Australian business bank account in AUD, or to a multi-currency account from a provider like Wise Business if you’d prefer.

Using an account from a provider like Wise Business can simplify the process of getting paid from abroad. You’ll be able to receive payments in foreign currencies, which you can then hold without being forced to convert the funds back to AUD immediately.

Ways to pay international invoices

You’ve got several different options when it’s time to pay your next international invoice. While sending the payment with your bank might feel like the obvious choice, it’s not always the cheapest. Shopping around before you transfer can mean you save money on fees in the end. Let's take a closer look.

Send an international payment from your bank

When an international invoice arrives, the natural place to turn might feel like your business bank account. Major Australian banks offer international payment services, which let you send money to more or less anywhere in the world. However, fees can apply - and the transfer times may not be as fast as you might expect.

To take Commbank as an example, transfers can take up to 3 business days to arrive¹. While there’s no stated Commbank fee for cross currency transfers, this doesn’t mean the service is free. Instead, there are likely to be fees added to the exchange rate used to convert your dollars to the currency being sent. As a percentage fee, this can add up very quickly on higher value payments.

Finally - the transfer limits for a digital payment with your bank may be surprisingly low, too. Commbank digital transfers have a maximum payment level of 5,000 AUD - to send more you’ll need to call the bank or visit a branch².

Specialist provider

Beyond simply paying international invoices, many Australian businesses also need to create and send them to overseas clients. Utilizing dedicated invoicing tools or software can significantly streamline this process.

These tools often provide professional templates, allow for the inclusion of all necessary international payment details (like SWIFT/BIC codes and IBANs), and can even help with multi-currency invoicing.

Some, like Wise Business, offer integrated invoice generators that allow you to create and send branded invoices in various currencies, making it easier for your customers to pay you from abroad into your chosen currency account. This can simplify reconciliation and help you manage your international cash flow more effectively.

International invoice payments with Wise Business

If you need to send and receive foreign currency payments for your business, you might be even better off with a multi-currency business account from Wise Business.

You can add money to your Wise account in AUD and send to 150+ countries in just a few taps - or receive customer payments with local and SWIFT account information in 8+ currencies, and handy invoicing tools to generate professional invoices in whichever currency you need. That means you can avoid unnecessary currency conversion costs if you deal in foreign currencies frequently.

Wise Business helps streamline overseas business payments without foreign transaction fees, saving up to 3x compared to other providers.

• Free to register — Send money to 140+ currencies with no hidden exchange rate markups
• Make up to 1,000 transfers at once with the Wise batch payments feature
• Fast, low-cost payouts to customers, freelancers, employees, investors, and suppliers globally
• Automate invoice payments, recurring transfers, and international payroll
• Fast and fully secure payments through Wise, even for large amounts

Tired of hidden fees and complex processes when making overseas payments?

Start sending with a Wise Business account! 🚀

Conclusion: Paying international invoices online with Wise Business

Paying overseas suppliers and contractors is part of everyday life for many business owners. And while it shouldn’t be tricky, it can be expensive if you get caught out by high fees or bad exchange rates.

Transact internationally for less, with Wise Business. Whether you choose to use Wise to send speedy international transfers, or to open a multi-currency business account to manage all your foreign currency needs in one place, you’ll know that Wise currency conversion uses the mid-market exchange rate with low, transparent fees. That keeps the costs of transacting internationally down, and means you spend less on fees.

Sources:

1. Commbank business international transfers
2. Commbank FAQ