The exponential growth of digital payments is transforming economies around the globe. As traditional payment methods give way to innovative fintech solutions, individuals and businesses alike must educate themselves on the options at hand in order to thrive.
However, one must exercise due diligence in researching providers before opting for their solutions. Factors like transaction fees, processing times, settlement periods, reporting features and even customer support must be evaluated thoroughly. The provider’s regional coverage and regulatory compliance should also weigh in on any decision-making. Checking third-party analyst reviews regarding ease of onboarding, platform stability and app ratings also come highly recommended.
This article offers perspective and advice to those looking to open an account with a digital payment provider.
In an increasingly globalised economy, the demand for seamless cross-border financial transactions continues to accelerate. For freelancers and SME owners conducting business internationally, the need for secure and regulated payment solutions can no longer be ignored. While traditional banks may fall short in servicing such needs, licensed payment processors fill the gap by offering robust digital financial services.
Payment systems provide the underlying infrastructure to facilitate movement of funds between payers and payees.
Key participants of the payment system: service providers and users
The payment system includes various institutions that are involved in the financial transaction process. We are talking about central banks, banks, payment processing companies and other financial institutions. These participants provide the infrastructure and services for conducting transactions. Their suite of offerings includes payment collection gateways, peer-to-peer transfers, currency conversion, merchant accounts, money remittance and more. By providing intuitive user experiences akin to apps and everyday banking whilst meeting stringent security standards, they are endearing themselves to retail and commercial clients alike.
These are individuals and corporate entities who open accounts in the payment system for the purpose of making international payments, transfers, etc.
The complex maze of regulations governing cross-border payments also means it is prudent to partner only with an established and compliant provider. Many leading processors are members of SWIFT and SEPA, whilst some may also issue multi-currency debit/credit cards carrying the Visa or Mastercard logo.
On the whole, as globalisation intensifies and businesses transcend borders like never before, payment systems are emerging as trustworthy allies for executing banking-grade financial transactions without geographic constraints. Rather than viewing them as disruptors, embracing their solutions can catalyse efficiency, boost security and unlock new revenue opportunities.
Pros of opening an account in a payment system
In an increasingly interconnected world, the ability to smoothly facilitate cross-border financial transactions is pivotal for globally focussed enterprises. Payment systems licensed to operate as financial market participants can enable key capabilities for such organisations compared to orthodox banking channels.
Prerequisites for the convenience and security of payment systems:
- The payment system's cloud-native infrastructure coupled with modular compliance requirements.
- Since many such platforms tap into global payment rails like SWIFT and SEPA, moving funds internationally is not only rapid but economical.
- Transaction costs are much lower in comparison, allowing businesses to conserve capital.
- Unlike conventional correspondent banking, payment platforms are more agile.
- Integrated merchant accounts, multi-currency IBANs, virtual cards and seamless pay-out solutions can be set up remotely in a matter of days to meet diverse needs.
- The heightened security and transparency of licensed providers also help de-risk dealings, especially when collaborating with foreign vendors.
- For freelancers and remote teams too, turning to a regulated payment partner 24×7 in one's native tongue is prudent.
- For merchants selling overseas or firms reliant on international trade, the capacity to quickly collect payments in different geographies via a single window.
- The simpler verification courtesy to detailed reporting and dashboard insights.
In summary, instead of setting up multi-jurisdictional bank accounts, opening an account in a payment system streamlines cross-border banking. The operational agility and cost savings unlock growth opportunities for outward facing enterprises while strengthening financial controls. As global commerce witnesses tectonic shifts, payment systems' solutions will likely turn the key.
Banks vs payment systems: Key distinctions for businesses
Conventional wisdom pits traditional financial institutions against the burgeoning array of payment systems, promising digital solutions. For enterprises intent on expanding overseas, understanding their core differences is essential.
On the one hand, we have longstanding banks. These are quite inertial and rigid traditional systems. Stringent compliance aside, their cumbersome processes, especially surrounding corporate account opening, deter agility.
On the other hand, banks possess an unparalleled product catalogue, from loans to investments to payments. But payment systems excel at the latter, using technologies like application programming interfaces (APIs) and virtual IBANs to facilitate frictionless funds flow.
You can choose between functionality and agility, personal communication versus self-service, abundance of choice versus curated offerings defines this divide.
Foreign companies seeking basic banking features like multi-currency accounts, payment acceptance and revolving working capital may benefit more from the flexibility of payment systems. Rather than an outright replacement for conventional banking, payment platforms complement their stodgy counterparts.
So as today’s enterprises aim for greater nimbleness amidst intensifying globalisation, opening an account in a payment system promises to be a secure and prudent choice. Its versatility can stimulate international expansion while keeping core systems simple.
Contact our specialists
Onboarding with payment systems: A step-by-step guide
Selecting a provider
The first step is determining an appropriate partner based on specific requirements around supported currencies, payout timelines, reporting needs and more. Consulting specialists ensures aligning with a platform that integrates smoothly with existing systems.
With selection finalised, necessary identification documents like business registration certificates, director passports and proof of addresses need to be organised. Recent bank statements evidencing business financials are also typically required.
The provided credentials feed the actual application that generates key compliance documentation. This includes self-declaration forms outlining the nature of business operations and anticipated transaction patterns.
Hereafter, KYC procedures kick-off spanning background screening of all connected entities and individuals along with document authentication checks. Assessing money laundering risks and confirming financial legitimacy also occur during this fraud prevention process.
Upon clearing due diligence requirements, clients can choose tailored packages whether concerning multi-currency collection accounts, payments reconciliation software or prepaid debit cards. Access credentials to online dashboards for managing transactions are also issued.
On the whole, while onboarding payment systems still necessitates customary diligence processes, their digitised workflows make compliance simpler. Selecting providers with multilingual support can further ease cross-border customers into leveraging these agile financial tools effectively.
Assistance in opening an account in a payment system: Choosing the right payment partner for your business
Overseas enterprises look for ideal payment systems to leverage for scaling operations. With myriad providers in the fray, an objective evaluation of specific needs is imperative before shortlisting options.
Industry consultants with the expertise of the cross-border payments can prove invaluable allies in this decision-making process. By holistically assessing your business model, risk appetites, compliance exposures, cash flow patterns and geographic ambitions, they benchmark suitable platforms.
- Account segregation, multi-currency reconciliation, customisable dashboards, partner integrations and responsive customer support weigh in too for growing enterprises. So do factors like credit card processing capabilities, vendor payment automation and extended payment terms to bolster working capital.
- The chosen payment system’s regulatory compliance record equally merits examination given dynamic Anti Money Laundering statues and data governance policies across borders. Client experiences specifically around ease of onboarding and timely issue resolution also signal the provider’s operational maturity.
- Once preliminary due diligence is complete, industry experts help narrow down on an optimal mix of payment, payout and foreign exchange functionalities befitting your commercial profile. As priorities shift in response to new market opportunities or regulations, they also advise on realigning with the most harmonious platform.
At YB Case, we offer our clients support in opening business accounts in the following payment systems:
- RD Wallet (Hong Kong).
- 3S Money (England).
- Emerald (England).
- LianLian (China).
- Ping Pong (USA).
- Payoneer (USA).
Opening payment system account costs
Licensed payment system in Hong Kong
You can open an account in the RD Wallet payment system for individual entrepreneurs, partnerships, limited liability companies in Hong Kong SAR, and overseas (excluding Mainland China)
HKD, CNY, USD, EUR, JPY
Hong Kong Business - HKD 1,200; Foreign LLC/Ltd – HKD 10,000; Offshore companies (e.g., BVI/Cayman Islands) - HKD 18,000
International corporate business platform with an electronic money institution licence in England
It is impossible to open an account in the 3S Money payment system for cryptocurrency activities, gambling, and money services companies
65+ currencies including USD, EUR, GBP, CHF, AED, CNY, HKD, SGD
Registration fees based on business type and complexity
Licensed payment processor regulated by the UK FCA
Open to individuals and corporate entities globally (EU blacklisted states, sanctioned companies, or high-risk activities can’t open an account in the Emerald payment system)
GBP, EUR, USD, CNY
EEA, UK, Switzerland - EUR 200; Other countries - EUR 1000
The Chinese payment system, accepting payments from 28 countries
Open to companies from various profiles globally
19 currencies including EUR, USD, CNY, HKD, SGD, PLN
You can open an account in the LianLian payment system for EUR 2,500
Global payment platform operating in multiple countries
Opening an account in the Ping Pong payment system available in India, USA, Korea, Hong Kong, Luxembourg, Singapore, Vietnam, Japan
50+ currencies including USD, EUR, JPY, GBP, AUD, SGD, CAD, MXN, AED
Free, with potential commission charges reported in the user’s account
International payment system for businesses, online sellers, and freelancers
Open to private and corporate clients globally (US-sanctioned jurisdictions’ ventures can’t open an account in the Payoneer payment system)
Various currencies including USD, EUR, GBP, JPY, AUD, CAD, MXN
Free, with potential USD 30/year fee for inactive accounts
Please note that the information provided is based on the public information and may be subject to updates or changes by the respective payment systems.
Opening an account in the payment system in 2024: Preparing documentation
- officially endorsed copies of the business registration certificate,
- tax identification paperwork and director passports,
- documents evidencing the registered corporate address and billing location are also mandatory for entities lacking brick-and-mortar premises within the provider’s jurisdiction.
- annual financial statements,
- existing banking relationships disclosing turnover activity,
- references from legal consultants could be requested here as proof points signalling legitimate operations.
On the whole, preparing documents outlining business purpose, structure and financial status facilitates accelerated onboarding and activation of payment facilities. Maintaining an audit trail covering identity verification and communicating operations intent remains integral, even with the convenience of digital banking ecosystems.
Of course, regulatory joists differ across providers and evolving Anti-Money Laundering norms bring new compliances. This is where consulting experts add value through bespoke guidance to steer requisite paperwork formalities for your enterprise.
Regulated payment platforms are emerging as indispensable allies for enterprises pursuing global growth today. Their versatility, compliance, and technology stack can fill the gaps left by conventional banking channels.
For international businesses struggling with financial access barriers, whether due to the very beginning of operating history or operating in higher risk spheres, these systems proffer viable recourse. By furnishing essential credentials, corporate entities worldwide can activate multi-currency accounts in the payment systems, payment reconciliation solutions and cross-border transfer facilities swiftly.
In fact, for online merchants denied avenues to collect payments from overseas clientele, integrating payment gateways promises to be a game-changer. Access to global payment infrastructure unlocks the capacity to conveniently receive, reconcile and repatriate funds across geography.
With advanced monitoring, automation and reporting also thrown into the mix, such tools provide complete visibility over cash flows. And by keeping overheads like foreign exchange conversions, transaction charges and compliance costs optimal, they stimulate profitability.
Of course, comprehending technical intricacies around providers, services, and regulations across borders is challenging. Herein lies the value of specialised consultants able to objectively evaluate requirements and align appropriate payment products as priorities evolve. If you want to quickly open an account in a payment system on favourable terms, contact specialised experts. YB Case business consultants can offer advice and support when opening accounts in payment systems.