How to Send Money Internationally A South African Business Guide

Sending money across borders often feels like a magic trick where your cash disappears into thin air. You agree on a price, pay the transfer fee, and yet the amount that lands in your supplier's account is somehow less than you expected. This isn't magic; it's the murky world of hidden fees, and for South African businesses, it's a serious drag on profitability.

The Real Cost of Sending Money Internationally from South Africa

Let's be blunt: the final amount that arrives is almost always less than you calculated when using traditional methods. This isn't just a rounding error; it’s a direct hit to your bottom line.

The biggest culprit is the exchange rate spread. Banks and many older payment providers don't give you the real exchange rate you see on Google or the news. Instead, they offer a less favourable rate and pocket the difference. A seemingly small 2-3% markup might not sound like much, but on a large supplier payment, it can easily bleed thousands of Rands from your business.

Unpacking the Hidden Fees

To truly understand what you're paying, you have to look past the obvious transfer fee. The total cost is a cocktail of different charges, some more transparent than others.

• The Advertised Transfer Fee: This is the flat fee you see upfront, like R250 per transaction. It's designed to be the most visible cost, but it's often the least significant part of the total.
• The Exchange Rate Markup: This is where the real damage is done. It’s the gap between the mid-market rate (the true rate) and the one you’re quoted. Think of it as a hidden percentage-based fee that scales up with your transaction size.
• Intermediary Bank Fees: If your payment travels through the SWIFT network, it can get "taxed" by correspondent banks along the way. These fees are unpredictable and often a nasty surprise for your recipient, who ends up with less than you sent.

For a South African business, these costs are anything but trivial. They make it harder to price your goods, mess with your financial forecasting, and directly eat into your margins. Choosing a transparent payment partner isn't a matter of convenience—it's a critical strategic decision.

The High Price of Payments in South Africa

We feel this pain more acutely here. Sending money from South Africa is notoriously expensive. The average cost for a $200 transfer hovers around 13.2%, which is more than double the G20 average of 6.39%.

If you're a small or medium-sized export business, these high costs can be a cash-flow killer, especially when dealing with high-cost SADC corridors. These aren't just statistics; they represent a significant barrier for local businesses trying to compete globally. For a deeper dive, Statista has some eye-opening data on remittance costs in South Africa.

This expensive and confusing reality is exactly why modern financial platforms exist. By offering clear, upfront pricing and access to real exchange rates, they provide a much-needed alternative to the opaque systems that have held businesses back for too long.

Traditional Bank Transfer vs Modern Platform A Cost Breakdown

To see how this plays out in the real world, let's compare a standard bank transfer with a modern platform like Zaro for a typical $10,000 supplier payment.

As you can see, the difference isn't just a few Rands. The savings from a better exchange rate and lower fees add up significantly, ensuring more of your money gets where it needs to go.

Getting Your Paperwork in Order: Compliance and Documentation

Sending money out of South Africa can sometimes feel like navigating a maze. For local businesses, getting the paperwork right isn't just a formality—it’s the difference between a smooth payment to your overseas supplier and one that gets stuck in a compliance review for days.

Every single financial institution, whether it’s a traditional bank or a modern platform like Zaro, is legally required to know who they’re dealing with. This isn’t just their internal policy; it’s part of a global crackdown on money laundering and terrorist financing (AML/CFT). The whole point is to make sure money crossing borders is legitimate and traceable.

First Things First: The Know Your Business (KYB) Check

Before you even get to your first transfer, your business itself needs to be verified. This is called the Know Your Business (KYB) process. Think of it as the corporate version of FICA—it’s absolutely non-negotiable.

The goal here is simple: the payment provider needs to confirm that your company is a real, legally registered, and operational business. This means you’ll need to submit official documents to prove your company’s existence, who owns it, and where it operates from. It might feel like a bit of a hurdle at first, but a successful KYB process paves the way for all your future international payments.

Financial institutions act as gatekeepers for the global financial system. To maintain its integrity, they need to know exactly who is using their gates to move money around the world.

My advice? Get your documents together before you even sign up. Having everything ready to go will make onboarding with any provider a hundred times faster.

Here’s what you’ll need:

• Company Registration Documents: Your official CIPC papers are the most important proof of your business’s legal standing.
• Proof of Business Address: A recent utility bill or a bank statement (usually under three months old) with your company's name and address on it will do the trick.
• Director and Shareholder Info: Be ready with certified ID copies (or passports) and proof of address for all company directors and major shareholders. This level of transparency is a cornerstone of AML rules.

Key Takeaway: The KYB process isn’t just bureaucratic red tape. It's a critical security check required by law to shield the financial system from crime. Getting it right upfront saves you from major headaches down the line.

Justifying Each and Every Transfer

Once your business is verified, you’re not quite done. Every single international payment you make also needs a reason—and proof. This is where South Africa's Balance of Payments (BOP) reporting regulations kick in. The South African Reserve Bank (SARB) mandates that every cross-border transaction is for a legitimate purpose, backed up by solid documentation.

For South African businesses, it's also worth noting the strict standards financial institutions must follow, like those for APRA CPS 234 compliance, which demand rigorous security and data protection. This is why providers are so meticulous about documentation.

Here are a few common scenarios and the paperwork you'll need:

• Paying a Supplier: A proper, dated invoice from your international supplier is essential. It must clearly detail the goods or services, the amount owed, and the supplier's full banking details.
• Paying a Contractor: You'll need a signed service agreement or contract. This document should lay out the work, deliverables, and payment terms, proving the payment to your freelancer is legitimate.
• Software Subscriptions: For these recurring costs, a formal invoice from the software company is all the proof you need.

From my experience, missing or incorrect documentation is the number one cause of payment delays. An invoice with the wrong date or an unsigned contract will almost guarantee your transfer gets flagged for a manual review, adding unnecessary days to the process. Double-check everything before you hit send.

Executing Your International Payment from Start to Finish

You’ve got all your compliance documents sorted and ready to go. Now for the main event: actually sending the money. Knowing how to send money internationally isn’t about clicking a single button. It's a series of careful choices to protect your capital and make sure your funds land safely and on time.

For years, the default option for any South African business was their bank. It's familiar, sure, but that path is often a minefield of hidden costs and frustrating delays, mostly thanks to the clunky, old SWIFT network.

In contrast, modern payment platforms were built to fix these exact problems. They give you a direct line to real exchange rates, much lower fees, and quicker processing. The choice you make isn't just about saving a few Rands; it’s about taking control of your company's cash flow with efficiency and transparency.

This visual breaks down the simple, documented journey a payment takes from the moment you hit send.

As you can see, a successful international transfer is built on a solid foundation: verified business identity and clear proof of the transaction, all locked in before any money moves.

Funding Your Transfer The Smart Way

Once you’ve picked your provider, you need to get the funds in place. For businesses here in SA, this usually comes down to funding from a ZAR account or, if your platform offers it, a multi-currency account (like one for USD). Which one is right? It completely depends on what you're doing.

• Funding from a ZAR Account: This is your go-to for most one-off foreign currency invoices. You deposit Rands, the platform does the conversion, and the foreign currency is sent to your recipient. It’s direct, straightforward, and perfect for things like paying overseas suppliers or software subscriptions.

• Using a Multi-Currency Account: Now, this is a game-changer. If you get paid in foreign currencies (say, USD from exports), holding those funds in a dedicated USD account is a seriously smart move. It means you can pay your USD invoices directly, completely skipping the cost of converting funds back to ZAR only to convert them back to USD again. This simple strategy can save your business thousands in pointless conversion fees.

Digging into specific scenarios is always helpful. To get a feel for how these principles work in the real world, it's worth understanding the specifics of how to pay international contractors.

Locking in Your Rate and Entering Details

This is a make-or-break moment. The exchange rate you get dictates the final Rand cost of your payment. With a bank, that rate is often a take-it-or-leave-it offer with a hefty markup baked in. A transparent platform, on the other hand, shows you the real rate and often lets you lock it in.

Pro Tip: Exchange rates are always on the move. If you're making a significant payment, locking in a good rate when you see one can make a real difference to your bottom line. Don't leave it to chance.

Next up, you'll need to enter the beneficiary's details. You have to be meticulous here. A single wrong digit in an account number or a misspelled name can get a payment rejected, sent back, or even lost in limbo for weeks.

Your Beneficiary Detail Checklist:

• Full Beneficiary Name: Make sure it's an exact match for their bank account name.
• Beneficiary Address: A full physical address is a must-have for compliance.
• Bank Name and Address: The name and branch location of their bank.
• Account Number / IBAN: Check, and then double-check, every single digit. The IBAN (International Bank Account Number) is the standard in Europe and many other places.
• SWIFT/BIC Code: This is the bank’s unique global address in the financial system.

Before you click confirm, give everything one final look. A simple mistake at this stage is the number one reason for payment delays and can lead to expensive recall fees. That extra 30 seconds of verification is probably the best investment you can make in this entire process.

Tracking and Reconciling Your Payment

You've hit 'send' – but you're not quite done. A properly executed payment means seeing it all the way through to the end. That involves tracking its journey and, finally, reconciling it in your accounting system.

This is where modern platforms really shine, offering real-time tracking dashboards. You can see precisely when the funds have left your account, when they've been processed, and when they’ve landed with your beneficiary. It’s a world away from the old "send and pray" approach, where you were left guessing until your supplier eventually confirmed they’d been paid.

The last step is reconciliation. Your payment platform should give you a crystal-clear transaction record showing:

• The exact ZAR amount that was debited.
• The exchange rate you got.
• Any fees that were charged.
• The final foreign currency amount that was sent.

This detail makes it dead simple for your finance team to match the outgoing payment to the right invoice in your accounting software, whether it's Xero or Sage. This closes the loop, keeps your financial records accurate, and gives you a clean audit trail for better financial planning down the road.

Putting International Payments into Practice with Real Scenarios

The theory behind cross-border payments is one thing, but seeing how it all works in the real world is what really matters. Let's move past the abstract and walk through three common situations that South African businesses like yours face every day.

These examples show how a smart approach to sending money internationally can make a huge difference to your bottom line, your efficiency, and even your business relationships. It’s not just about getting money from A to B; it’s about doing it intelligently.

Scenario 1: Paying a Large Supplier Invoice in China

Let's say your manufacturing business needs to settle a $50,000 invoice with a key supplier in Shenzhen. If you go through a traditional bank, the process is often a black box. You might get quoted an exchange rate of R18.95 to the dollar, when the real mid-market rate is actually closer to R18.50.

That difference, a seemingly small 2.4% spread, quietly eats R22,500 on this single transaction. And that’s before you even add the R500 transfer fee and potential SWIFT charges that could delay the payment, leaving your supplier short-changed and frustrated.

Now, picture using a modern payment platform instead. You get the real R18.50 exchange rate, with a clear, low fee. The full $50,000 lands with your supplier, often within a day, and your total Rand cost is significantly lower. The saving is immediate and very real.

The big lesson here? For large-value payments, the exchange rate spread is the single most important factor. Getting a transparent rate isn't a "nice-to-have"—it's fundamental to managing your cost of goods and protecting your profit margins.

Scenario 2: Paying a Remote Developer in Kenya

Your tech company relies on a talented software developer in Nairobi, whom you pay $2,500 a month. Here, speed and reliability are everything. A late payment erodes trust and can throw your project workflow into chaos.

Sending this through a bank often means a 3-5 day waiting period, with no real way to track where the money is. That uncertainty is stressful for both you and your contractor.

This is where efficient payment rails really shine. A fintech solution can often land a transfer in Kenya within 24 hours. The entire process is trackable, so you can tell your developer exactly when to expect their funds.

• Speed: Payments arrive in a day, not a week.
• Transparency: Both you and your contractor have full visibility.
• Lower Fees: The cost to send smaller, recurring payments is kept to a minimum.

For any business working with international talent, this kind of efficiency is non-negotiable for building strong, professional relationships.

Scenario 3: Repatriating USD Revenue from Exports

Imagine your agricultural business has just closed an export deal to the United States and now has $100,000 sitting in a US bank account. The goal is to bring that revenue home to South Africa to cover your local operational costs.

The default move is to simply wire it back through the banks. Unfortunately, this exposes your hard-earned revenue to the same poor exchange rates and hidden fees we saw in the first scenario. A bank might offer you a rate of R18.10 for your dollars when the real rate is R18.50. Just like that, R40,000 of your export earnings vanishes into thin air.

A much smarter strategy is to use a platform that lets you hold a USD balance. You can then choose the best time to convert your funds back to ZAR at the real exchange rate. Better yet, you can use that USD balance to pay your own international invoices directly, skipping conversion costs entirely. This transforms your payment system into a powerful cash management tool.

The scale of these business-to-business transactions is massive. South Africa's remittance market is booming, with outbound payments making up 64% of a USD 330 million market, driven mostly by businesses paying for goods and services. Since 2016, total outflows have hit a staggering R112.6 billion, which shows just how much capital is moving across our borders. You can find more insights in this report on South Africa's cross-border transfers market.

By optimising how you handle both incoming and outgoing foreign currency, you’re actively protecting your company’s financial health and squeezing the most value out of every Rand you earn and spend.

Building a Smarter International Payment Strategy

For too long, South African businesses have just accepted that sending money overseas is expensive, slow, and frustrating. It doesn't have to be. Moving money internationally shouldn't be a reactive chore; it should be a smart, proactive part of your financial strategy.

The old way of doing things, usually through a traditional bank, is riddled with hidden costs and confusing processes. It’s time to move past that model.

The numbers show just how much money is flowing out of the country. Between 2016 and today, a staggering R112.6 billion was sent from South Africa to other SADC countries. Annual outflows jumped from R6 billion to R19.3 billion in that time. Yet, despite more service providers entering the market, many businesses are still stuck with outdated methods, losing money on SWIFT fees and inflated exchange rates. You can dig into these outflow trends from South Africa to see the full picture.

Gaining Control Over Your Global Finances

A better strategy begins with two simple things: visibility and control. Instead of just sending money and hoping for the best, modern platforms put your finance team in the driver's seat, giving you a clear view of your international cash flow.

This is where features designed for growing businesses really make a difference. Take multi-user access and customisable permissions, for example. This means you can give different team members specific roles. Your finance manager could be set up to prepare payments, but only the CFO has the final sign-off. This creates a secure and auditable workflow, minimising the risk of errors or unauthorised payments.

It’s this kind of control that gives CFOs peace of mind when managing company funds across borders. You’re no longer relying on a single person; you have a robust, collaborative system.

Eliminating Hidden Costs and Currency Risk

The biggest strategic win comes from tackling costs directly. A genuinely modern payment platform gives you access to the real spot exchange rate, cutting out the hidden markups that banks quietly build into their rates. This one change alone can save your business a small fortune on every single large transaction.

The real power lies in removing uncertainty. When you know you’re getting the true exchange rate with zero SWIFT fees, you can forecast your costs with pinpoint accuracy. There are no more unpleasant surprises when the final amount is reconciled.

Another game-changer is the ability to hold balances in multiple currencies, like having both ZAR and USD accounts. This is a massive advantage for managing currency risk.

Here’s how it works in practice:

• You can receive USD revenue from international clients and hold it as USD, without being forced to convert it to Rand at a bad rate.
• When it's time to pay a USD invoice to an overseas supplier, you can simply use your existing USD balance, dodging conversion fees and FX volatility entirely.
• You get to choose the best time to convert your funds, waiting for a more favourable exchange rate to maximise the Rand value of your export earnings.

Suddenly, your international payment system isn't just a transactional tool. It becomes a dynamic asset for managing cash flow, giving your business the agility to operate globally while protecting your bottom line from unpredictable currency swings.

Frequently Asked Questions

Sending money across borders can feel like a minefield of hidden costs and confusing rules. Let's clear up some of the most common questions South African businesses have when they start trading internationally.

What’s the cheapest way for my business to send money internationally from South Africa?

Forget what the big banks tell you. The cheapest way is nearly always through a modern fintech platform that gives you the real, mid-market exchange rate without adding a markup.

It's an old trick: advertise a low transfer fee to get you in the door, then give you a terrible exchange rate. A bank might promote a "low" R250 fee, but the real damage happens in the exchange rate they offer. That hidden cost, called the spread, can be substantial, especially on larger payments. Platforms built for business are transparent, stripping away these hidden costs so you know exactly what you’re paying.

Think about it: a 2% spread on a R500,000 payment is a R10,000 hidden fee. Transparent platforms get rid of this, making the fair exchange rate, not the tiny initial fee, your biggest source of savings.

What documents do I need to send money overseas from my SA business account?

To stay on the right side of the South African Reserve Bank (SARB), you'll need two sets of documents. It’s a standard process that covers both your business and the payment itself.

First up is verifying your business through a Know Your Business (KYB) check. This is non-negotiable and a key part of anti-money laundering (AML) compliance.

• For your business (KYB): Have your CIPC registration documents, a recent proof of your business address, and certified ID copies for all company directors ready to go.

Next, every single transaction needs a supporting document to justify why you're sending the money.

• For the transaction: This could be a supplier invoice, a service agreement for a contractor, or even a receipt for a software subscription. The goal is to prove the payment is for a legitimate business expense.

How long does an international money transfer from South Africa actually take?

The time it takes for your funds to land can vary wildly, and that's a massive deal when you have suppliers or remote staff waiting to be paid.

Traditional bank transfers using the old SWIFT network are notoriously slow—expect anywhere from 2 to 5 business days. And that's if everything goes smoothly. Delays are common, often thanks to intermediary banks or compliance checks that leave both you and your recipient guessing.

This is where modern fintech platforms really shine. They use smarter payment networks and automated compliance to get money where it needs to go, fast. It’s not unusual for payments to arrive the same day or by the next business day, giving you the kind of speed and certainty that builds trust with your global partners.

What’s the difference between an exchange rate spread and a transfer fee?

Getting your head around this is the single most important thing you can do to control your international payment costs. They are two completely different charges—one is obvious, the other is often completely hidden.

• A transfer fee is the fixed amount you see upfront. It's that R250 (or whatever the provider charges) for the service of sending the money. It's easy to spot.
• An exchange rate spread is the hidden cost. It’s the gap between the real mid-market exchange rate (the one you see on Google) and the worse rate your provider actually gives you.

For any business sending significant amounts, the spread is almost always the biggest cost. It’s a percentage-based fee that grows with your transaction, quietly eating into your funds without ever showing up as a line item on your statement.

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Ready to stop overpaying on international transfers and take control of your global finances? Zaro offers South African businesses direct access to real exchange rates with zero spread and no SWIFT fees. See how much you can save and simplify your payments today. Learn more at https://www.usezaro.com