How to Pay Overseas Suppliers Safely: B2B Payment Methods Compared

To pay overseas suppliers safely, match the payment method to the level of trust and the size of the order, check that the bank account belongs to the company you are dealing with, and tie each payment to a clear milestone. No method removes all risk, but a few simple habits protect most buyers. This guide compares the main international payment methods for B2B trade, explains deposit and balance payment, and lists the fraud checks every importer should do before sending money.

Why payment method matters in international trade

When you buy from a supplier in another country, a dispute is harder to resolve. You cannot walk into their office, and legal action across borders is slow and costly. So the payment method becomes your main protection. It decides who carries the risk: the buyer who has paid but not received goods, or the seller who has shipped but not been paid. A good payment structure shares that risk fairly.

International payment methods B2B buyers use: the main options

Wire transfer (bank transfer, TT)

A wire transfer to supplier, often called telegraphic transfer or TT, moves money from your bank account to the supplier's bank account. It is the most common method in international trade. It is simple, widely accepted and usually has reasonable fees for larger amounts. The weakness is that once the money leaves, getting it back is hard if the supplier does not deliver. A wire transfer is therefore best used with suppliers you have verified, with payments split into stages.

Letter of credit (L/C)

In a letter of credit, your bank promises to pay the supplier once the supplier presents documents that match the terms, such as the bill of lading, invoice and packing list. It protects the buyer, because payment depends on shipping documents, and protects the seller, because a bank backs the payment. It costs more, takes more paperwork and is unforgiving of document mistakes. It suits larger or first-time deals between parties who do not know each other. Read our guide to letters of credit for importers and exporters for details.

Escrow or platform payment protection

With escrow payment B2B, a third party holds your money and releases it to the supplier when agreed conditions are met, such as delivery or acceptance. Some online marketplaces and independent escrow services offer this. It reduces the risk of paying a stranger, but terms differ widely: what triggers release, how disputes are decided, fees and time limits. Read the rules of the specific service before relying on it. Comilmart has a trade assurance page; read it for current terms rather than assuming what it covers.

Credit or debit cards and online payment services

Cards and online payment services are convenient for samples and small orders. Card payments may offer some dispute rights through the card issuer, but limits, fees and terms vary, and business cards or high-value transfers may be restricted. Fees are often higher than a bank transfer for larger amounts. Check your card issuer's rules.

Open account and credit terms

Open account means the supplier ships first and you pay later, for example net 30 or net 60 days. This favours the buyer and usually requires a long relationship or credit insurance. For a new importer, it is unlikely at first. Our guide to net 30, net 60 and net 90 payment terms explains how it works.

Deposit and balance payment: how it usually works

For manufactured goods, a common structure is a deposit to start production and a balance before shipment or against shipping documents. The idea is that the factory needs funds to buy materials, and you want the final payment to depend on seeing the finished goods. The right split depends on the product, how custom it is, the supplier's size and your history together, and there is no universal figure. Considerations when you decide:

• A custom product that the factory cannot sell to anyone else may justify a larger deposit.
• A standard stock item may justify a small deposit or payment against documents.
• Where possible, hold back the balance until you have the pre-shipment inspection report or the shipping documents.
• For a first order with a new supplier, a smaller order is safer than a larger one with a big deposit.

Negotiate the terms and put them in writing. Our article on how to negotiate with suppliers includes ways to trade payment terms against price.

Comparing the methods at a glance

• Wire transfer: simple and common; weak buyer protection; best for verified suppliers and staged payments.
• Letter of credit: strong protection for both sides; higher cost and paperwork; suits larger or new relationships.
• Escrow or platform protection: adds a third party; rules vary by provider; useful for new relationships if terms are clear.
• Cards and online services: convenient for small amounts and samples; check limits and fees.
• Open account: best for the buyer; needs trust or credit insurance; rare for new importers.

Fraud checks before you pay

Payment fraud in B2B trade is real, and a common form is a fake or hijacked email asking you to send money to a new bank account. Do these checks every time:

1. Verify the company. Check registration, address, website age, business licence and references. See our scam alert page for common patterns.
2. Match the account name to the company name. A request to pay a personal account or a company with a different name is a warning sign.
3. Confirm bank details by a second channel. If bank details change, call a number you already trust, not one in the email asking for the change.
4. Use a pro forma invoice or contract that lists the bank details, quantity, price, terms and delivery date.
5. Be wary of pressure and too-good prices. Urgency, big discounts for immediate payment and refusal of any inspection are common patterns.
6. Start small. A sample order and a first small order show how a supplier behaves.
7. Keep records. Save invoices, transfer receipts and messages.

Paying suppliers in China and other countries: practical notes

If you pay suppliers in China, the same principles apply as elsewhere. Many Chinese suppliers accept bank transfers in US dollars, and some accept other currencies or platform payments; ask what they accept and what bank charges apply at both ends. Rules on foreign exchange and bank accounts differ by country, so confirm with your bank how it handles the payment, and whether the supplier's bank account is a corporate account in the company's name. The same checks apply when you buy from African, Indian, Turkish or European suppliers.

Currency, fees and timing

• Exchange rates. If you pay in a foreign currency, the rate on the payment date matters. Ask your bank about the rate and margin it applies, and consider paying all at once or fixing a rate if your bank offers that.
• Bank fees. Sending banks, intermediary banks and receiving banks may each charge a fee. Decide who pays (shared, buyer or seller) and write it on the order.
• Timing. International transfers can take days, and public holidays or compliance checks can add delay. Plan for it so a late payment does not delay production.
• Documents for your bank. Banks may ask for the invoice or contract to release a payment, especially for large sums.
• Funding costs. If you need finance to pay a supplier, ask your bank about trade finance options.

Frequently asked questions

What is the safest way to pay an overseas supplier? There is no method that removes all risk. A letter of credit or a trusted escrow service gives stronger protection than a plain wire transfer, while verifying the supplier and splitting payments matter whichever you use.

Is a 30 percent deposit standard? You will see deposits like that, but there is no universal rule. The right amount depends on the product, the supplier and your leverage. Negotiate and document it.

Can I pay a supplier by credit card? Some accept cards for samples and small orders. Check fees and the issuer's dispute terms.

What if the supplier asks me to pay a personal account? Treat it as a red flag. Ask for a corporate account in the company's registered name, and confirm details through a trusted channel.

What should I do if I think I sent money to a fraudster? Contact your bank immediately and ask whether the payment can be recalled, then report to the relevant authorities. Speed matters.

Should the balance be paid before or after shipping? Many buyers pay the balance after inspection and before release of shipping documents. Choose a structure that fits your risk and the supplier's trust level.

Getting started

Before your next payment, verify the company, match the bank account name, and agree the deposit and balance in writing. To find suppliers and compare offers, post a request on Comilmart or browse the catalog. Comilmart connects buyers with verified sellers across Africa, and there are no listing fees to get started. This article is general information; confirm payment, tax and foreign exchange rules with your bank and a qualified adviser.