Reduce Costs and Complexity When Paying Chinese Suppliers

Ireland Imports from China was US$12.75 Billion during 2024, according to the United Nations COMTRADE database on international trade.

For Irish small businesses that regularly import goods from China, finding the smartest and most cost-effective way to pay overseas suppliers is essential, not just for efficiency, but also to protect margins.

The Challenges of Paying Chinese Suppliers

Making international payments, especially to China, can be more complicated than it should be. A recent survey of 250 Irish SMEs reported in The Irish Times found that the vast majority had experienced frustration with international banking services. Among the top concerns are:

• 32% found services too slow or complex.
• 27% were confused or dissatisfied with high banking fees.

Here are the key issues in more detail.

Hidden Costs in Currency Exchange

• Exchange Rate Risk: Payments to China are often made in either Renminbi (RMB) or US Dollars (USD). As the Euro fluctuates, the cost of your payment can rise unexpectedly, making it harder to forecast profit margins.

• Poor FX Rates & High Fees: Banks tend to offer uncompetitive rates and tack on significant international transfer fees. The European Central Bank found that smaller businesses are routinely overcharged for foreign exchange while also paying up to 25 times more for hedging solutions than large corporates.

Lack of Personal Support

Cross-border payments come with their own regulatory and operational hurdles, especially when dealing with destinations like China where payment formats and timing can vary. But many banks only assign account managers to large clients, leaving smaller businesses with generic customer service lines and delayed issue resolution.

Limited Currency Options

Most Chinese suppliers will invoice in USD or EUR. But here’s the catch: you’re often charged more in those currencies because the supplier is protecting themselves from FX volatility. Those extra margins are passed on to you.

By contrast, paying in RMB (yuan) can often secure a better deal. However, many traditional banks don’t support exotic currencies like RMB.

Smart Tips

• Always Ask for a Dual-Currency Quote: One of the simplest ways to lower costs is to ask your supplier to quote prices in both RMB and USD. Then compare the cost of each, using the euro-to-dollar and euro-to-renminbi exchange rates. In many cases, you’ll find that paying in RMB is significantly more cost-effective.
• Look for a Better Way to Pay: Many Irish small businesses don’t realise they can change the normal route offered by traditional banks. Shop around for better exchange fees. With the right payment partner, you can:

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This article is written in partnership with Fexco International Payments. Fexco International Payments is a proud partner of the SFA and provide for SFA Members:

• Payments in over 130 currencies, including RMB
• Access to more competitive FX rates
• No hidden charges and complex fee structures
• Dedicated support from a real account manager—not a chatbot

Explore Fexco's offer for SFA Members