Bank accounts and money exchange transfers
What are the best Foreign Currency Exchange options for Australian Amazon Sellers who are selling on Amazon FBA in the USA and other international marketplaces?
Amazon has recently reduced their currency transfer fee from 4% to 1.5% for money transferred from Amazon USA accounts to AUD accounts in Australia. This means that, if you have an Australian Bank account with AUD currency, you will be receiving more money into your account when getting a payment from Amazon.
When you first start out on Amazon, you will need an account for a few different reasons. The first reason will be for verification. So, when you are being verified in the beginning, you will want to give them a bank statement from an account that you have had for a while and where the details on the account are identical to what you have used in the backend. You will be able to change this later but, initially, you just need them to verify your identity with an existing account.
You will also need to put a receiving account into sellercentral to receive funds into. As it will take some time for you to receive any substantial amounts into your account, it is easier to just use your existing Australian business account for that purpose.
From a bookkeeping perspective, if you are a sole trader, you want all your business funds to go through one or two separate accounts that you don’t normally use for personal expenses so that you can keep your bookkeeping costs low. The more funds you need to explain to your bookkeeper, the more time they will spend tidying up your accounts.
If you have a Pty Ltd Company, you will need an account under the company name and your accountant will be able to advise on how to use it exclusively for business purposes to make your bookkeeping and accounting fees reasonable.
Apart from that, though, you need to think about foreign exchange currency transfer fees, both when you purchase from overseas suppliers, as well as when you are receiving money from Amazon. For this purpose, you will want to have at least one US$ account that will give you lower fees. If you are also selling into other countries and marketplaces, you might want to think about other currency accounts as well.
Amazon has recently announced their New Payment Service Provider Policy. The new policy states the following:
As part of our continued effort to make Amazon the safest and most trusted store in the world for customers and sellers, we are launching the Payment Service Provider program to enhance our ability to detect, prevent, and take actions against potential bad actors so we can continue to protect customers and sellers from fraud and abuse. Sellers that choose to use a payment service provider (PSP) to receive their Amazon store sales proceeds will be required to use a PSP that is participating in this program. We are notifying you now so that you have sufficient time to change or contact your PSP if needed.
1. Do I need to take any action?
If you do not use a PSP, but instead are using a bank account directly issued to you by a bank, no action is required.
If you use a PSP that is already signed up to participate in the program (including LianLian Pay, Payoneer, PingPong and WorldFirst), no action is necessary. We are working diligently to enroll additional PSPs into the program as soon as possible, and will continue to update this page this page with participating PSPs.
If your PSP is not yet participating, we recommend you contact them to learn about their plan to enroll in our Payment Service Provider program. If they do not plan to enroll, you should switch to a participating PSP or use a bank account directly issued to you by a bank by May 31, 2021. Detailed instructions on how to make the changes are available here.
Beginning on March 1, 2021, sellers adding a new bank account from a PSP must use a PSP that is participating in the program.
2. What if I continue using a non-participating PSP after May 31, 2021?
Sellers who continue using a bank account from a non-participating PSP after May 31, 2021 will be subject to a longer disbursement reserve period of up to 21 days after the latest estimated delivery date (click here for more detail on payments based on delivery date).
Beginning on July 15, 2021, we will stop disbursement to sellers using non-participating PSPs altogether.
3. What should I do if I am using Amazon Currency Converter for Sellers (ACCS)?
If you are using ACCS and are disbursing your Amazon store proceeds to a bank account directly issued to you by a bank or by a participating PSP, no action is necessary. If you are using ACCS to disburse to a bank account issued by a non-participating PSP, refer to Question #1 above to determine whether you need to take action accordingly.
Out of all the providers listed, at the time of writing this update, sellers who are based in Australia have access to 4 options:
- World First at the rate of 0.5% for receipt in US Dollars into a USA bank account,
- OFX at a rate of 0.85% for receipt in US Dollars into a USA bank account,
- Payoneer at the rate of 1.2% for receipt in US Dollars into a USA bank account connected to a Debit Card,
- Your own Australian bank at the rate of 1.5% for receipt in Australian Dollars directly from Amazon.
World First have a fee-free, 0.5% transfer rate off the bat (plus AUD5 fee for transfers under AUD2,000), the lowest on the market today, no questions asked, if you sign up through here. Another great thing about World First is that their accounts integrate with Xero. The integration means that you will never have to pay for your bookkeeper to import transactions into Xero, saving you a decent amount in bookkeeping and accounting fees every month.
World First and OFX do not currently offer a debit card connected to your account. This means that if you are making ongoing payments through an Australian credit/debit card, you are paying international service and transfer fees that could be quite high with your Australian bank every time Helium10 or Amazon take a regular payment. If you have multiple credit card payments coming out every month, it may be worth looking at Payoneer.
Payoneer has always had the debit card function, they have now released AUD balances into accounts and they are giving members of the Amazon Sellers Australia, USA & Global Facebook Group a preferential rate of 1.2%.
Here are the details:
- 2% general rates. Mention that you are a member of the Amazon Sellers Australia, USA & Global Facebook Group for fee-free preferential rates of 1.2%!
- Payoneer debit card for subscriptions (Helium 10, shopify, etc)
- Pay amazon advertising directly from within your Payoneer dashboard
- Load AUD for supplier payments, etc
- Free payments between Payoneer accounts (Pay staff/suppliers for free)
- Introductions to new global marketplaces (Wallmart, shopee, JD, Lazadda, etc)
Customers will need to be on the latest version of the Payoneer Australia account. Please email [email protected] and mention that you are part of Calli’s network for help with creating your accounts. Remy Jansons or Bonnie will be happy to help you.
When getting a USA or Global account, remember that you have more negotiating power, the more money you transfer with a company. If you have a thriving Amazon business, your transfers will be higher than others’. So, you could use that to your advantage and get some serious savings in your bank account.