With 6 million yuan of funds frozen, how difficult is it for foreign traders to “put their money in safe hands”?

With 6 million yuan of funds frozen , how difficult is it for foreign traders to “put their money in safe hands”?

The foreign trade situation is ever-changing. Making money is important, but securing funds is the most important thing!

Collection and settlement of foreign exchange, as an important part of completing foreign trade transactions, play a vital role in the entire business chain.

As one of the "three engines" driving the economy , foreign trade continued to maintain a rapid growth momentum from January to July this year, with a growth rate of 24.5%, a record high in the past ten years. While foreign trade enterprises continued their good development momentum, they also faced many challenges.

Collecting payments is a challenge for many foreign trade people!

Due to the surge in international logistics costs, the sharp rise in raw material prices, the difficulty in recruiting workers in some regions, the high cost of labor, the difficulty in developing overseas markets, and the high costs, the problem of rising comprehensive costs for China's foreign trade enterprises has become increasingly prominent. Chinese foreign trade enterprises are deeply trapped in the "cost war", resulting in squeezed profit margins. In fact, in addition to the difficulty in determining positions and the rise in raw material prices, sample orders that are ignored by sellers are also a "black hole" that eats up profits bit by bit.

At present, most foreign trade customers adopt the method of giving away samples for free because the amount of sample orders is not high or the traditional bank payment method is complicated and troublesome. In this way, if hundreds of sample orders are sent out a year, each order costs tens to hundreds of US dollars , the sample fees given away for free in a year will reach tens of thousands of US dollars, equivalent to more than 100,000 RMB , which can hire another operation staff .

For small and medium-sized enterprises that are overwhelmed by costs , if they can reduce all costs that can be reduced in the sample order and other links, then the already thin profits will be "thickened" little by little. However, the determination of foreign trade people to reduce costs has been dampened by reality! The difficulty coefficient of collecting payment for sample orders is quite high, so a large number of foreign trade people are "forced to give away for free."

In addition to sample orders, urgent orders also face the obstacle of difficulty in collecting payment.

When many foreign trade people encounter urgent purchase orders, the slow payment speed always hinders them from making money. Recently, there have been frequent news reports about warehouse explosions and warehouse shortages. If a strong buyer has already arranged a warehouse, the merchant needs to deliver it to the shipping company within a limited time to catch the ship. At this time , foreign trade people usually arrange shipment after confirming the deposit has been received. If the traditional T/T wire transfer is used , it will take 2-5 days, plus the customs clearance and transportation time, it will not be able to catch up in time .

Some foreign trade merchants also use PayPal to collect sample orders and urgent orders, but PayPal cannot be converted into RMB in China, and can only withdraw US dollars and Hong Kong dollars, charging a withdrawal fee of 35 US dollars per transaction. At the same time, a transaction fee of 4.4% + 0.3 US dollars is required when the money is deposited into the account, which makes the already meager foreign trade profits worse, or only 50,000 US dollars of personal foreign exchange settlement quota can be used to recover the funds in PayPal. There are many such "poor moments" in foreign trade collection, and foreign trade people need to solve the problem of money that cannot be collected and money that is difficult to collect!

How difficult is it for foreign traders to “put money in pocket”

Although the Chinese government has provided strong policy support to the foreign trade industry, China is a country with foreign exchange controls after all. When we foreign trade people conduct goods transactions and receive foreign exchange payments, we must still follow the country's foreign exchange management policies to conduct transparent foreign exchange settlement. Only then can the money we earn be safely in our pockets, otherwise it will just be a set of numbers! " More and more examples verify the importance of this sentence .

In the process of foreign trade payment, foreign trade merchants usually use domestic public accounts or offshore accounts to collect payments. These two traditional payment methods have now exposed many problems.

From an objective point of view, when we foreign trade people engage in foreign trade transactions, we generally will not give up the business where the buyer uses a non-corporate account or a third party to wire the money. This provides an opportunity for underground banks or other overseas financial institutions to take advantage of it, but this will directly bring financial risks to our collection of payments .

The editor interviewed a number of senior foreign trade people, who reported that without any psychological preparation, the sudden misfortune of having their funds frozen due to suspected underground money transfers directly disrupted the normal business rhythm and almost cut off the cash flow.

There are also foreign trade people whose personal accounts are being repeatedly frozen. The payment for the goods was just received one minute ago , and the account was frozen in the next. After going through a lot of hardships to unfreeze the account, they have to embark on the long journey of unfreezing the appeal account again!

Yiwu, as the birthplace of a large number of small and micro foreign trade business owners, happens to be the focus of this "card freezing incident". The reason for the incident is that the Criminal Investigation Brigade of the Yiwu Public Security Bureau publicly released a "Letter to Public Security Organs Across the Country" to provide assistance in freezing bank accounts for Yiwu foreign trade people affected.

According to incomplete official statistics, due to suspected telecom fraud or online gambling , in 2020 alone, more than 10,000 bank accounts of enterprises and individuals in Yiwu were sealed by local public security departments, and the frozen funds exceeded 1 billion yuan. The scope of the impact has at least doubled compared with 2019. One foreign trade merchant had 6 million yuan frozen . In order to turn over funds, he had to take out a loan, with interest of hundreds of thousands a year.

In this situation, merchants with strong financial resources may be able to hold on, but some merchants with weak financial resources will go bankrupt directly.

Offshore banks often become nervous at the slightest sign of trouble or individual violations, and close a large number of offshore accounts. Foreign trade merchants can no longer use the Hong Kong accounts they have opened with great difficulty, so how to safely and transparently recover foreign exchange has become a major problem for foreign trade merchants.

In view of this, traditional banks can only receive payments through T/T wire transfers, which are slow to arrive, have complicated outward payment procedures, and result in high exchange losses. Offshore accounts also have many problems such as high risks, difficulty in opening accounts, inability of funds to enter the country, easy closure, troublesome maintenance, and expensive fees.

Where is the better choice for foreign trade professionals?

It can be seen that traditional banks and offshore accounts can no longer meet the diverse needs of foreign trade people. Whether from the perspective of timeliness and fund security, or from the collection difficulties caused by the urgent orders and sample orders mentioned in this article, payment platforms are needed to provide corresponding solutions.

Through recent visits to many foreign trade training sessions and professional exhibitions, the editor found that a third-party cross-border financial platform called Payoneer frequently appeared. At the Shenzhen-Dongguan-Huizhou Cross-border E-commerce Summit hosted by Alibaba International Station, Payoneer attended as a diamond partner and proposed a B-side comprehensive collection financial solution for the foreign trade industry. At the ISEA Tianjin Exhibition , it was invited to provide comprehensive financial services for the foreign trade post-market to the foreign trade community. At the same time, it was invited by Dunhuang.com to participate in the Greater Bay Area New Trends Forum, providing foreign trade financial security collection support for the transformation of traditional foreign trade, and so on.

It is reported that Payoneer has been providing digital foreign exchange convenient payment services for Chinese foreign trade merchants since 2016. Recently, Payoneer has been frequently invited to join government foreign trade associations in Guangzhou, Shenzhen, Nanjing, Hangzhou, Qingdao, etc. At the same time, PAYONEER is the first listed company in the cross-border financial industry to be listed on the US stock market. After in-depth understanding and communication, the editor found that :

In addition to accepting traditional T/T wire transfers, Payanying 's accounts also accept credit card payments. What's more worth mentioning is that registration and maintenance are completely free. In addition to T /T wire transfers for conventional large goods, when foreign trade professionals encounter some urgent orders, small-amount and high-frequency orders or sample orders, they can let overseas customers pay by credit card to quickly and efficiently finalize the transaction . Payanying credit card collection supports a maximum limit of US$15,000 per transaction, and the payment is received in real time; compared to PayPal's high fees and inability to convert foreign exchange into RMB, Payanying credit card collection does not charge any entry fees except for the handling fee paid by the buyer to the credit card company .

In addition, Payoneer is included in the global financial supervision and strict anti-money laundering risk system, and cooperates with world-class banks to fully protect the seller's financial security and personal data privacy, and to settle foreign exchange in a transparent manner without occupying the personal foreign exchange settlement quota of 50,000 US dollars. Moreover, Payoneer can not only truly solve the pain points of foreign trade merchants in collecting payments, but also has diversified global payment functions. In addition to conventional withdrawals to company accounts , legal person private accounts, payment suppliers and service providers, Payoneer's "Sui Xin Pay" also supports online and offline card consumption, payment of overseas advertising fees, ATM withdrawals , payment of independent station fees, express logistics fees, binding electronic wallet payments, etc., and you can enjoy up to 0.5% of the payment amount rebate, pay more and enjoy more, with no upper limit.

Foreign trade people who are interested, scan the QR code below now to sign up for the Paianying Foreign Trade New Customer Rate Discount Event, with a tiered cash back and withdrawal fee up to 100%!!!

Foreign traders who are interested can now click the link www.payoneer.com.cn to quickly register for Payoneer and enjoy the convenience and diversified payment functions brought by Payoneer!