Importing from US - banking options

M

MOH

Guest
In the process of starting a business with at least some stock to be imported from the US, for the moment anyway. Probably won't start buying for another month or so.

Purchases for the first few months are likely to be infrequent and relatively small (2-3K), but given the way the exchange rate is sliding at the moment, I'm considering opening a USD account for the business and buying some dollars now.

Looking for advice on a few points:
- do all the main banks offer USD accounts? I know AIB do, BOI seem to, Ulster's website doesn't seem to mention them. Any other options I should consider
- is it generally possible to get a c/card on such an account. And if so, am I right in thinking that if I buy in USD on such a card on a USD account, there's no fx fees involved?
- what kind of direct payment methods are available? Had a quick look through AIBs website and saw Paylink as an option, with at least €20 per transaction in fees. Are there cheaper transfer methods available through internet banking on USD accounts?
- any other advice in general for protecting oneself from currency fluctuations?
 
moh get some stuff from the us as well and haven't found a good way to hedge the currency yet sometimes I'm up and sometimes I'm down. Whats a bigger constraint on cashflow imho is the clearing of goods when they arrive ie you pay vat at entry on top of any duty due etc. it all adds up. find the exise code for the product and it will give you some idea but the vat being paid upfront is a killer on cashflow.
 
Hi Moh,
You should talk to the CommercialFX section in you bank.
They could set up a USD forward contract which is an agreement to buy x dollars
on or before a set date in the future at an agreed rate.
This will give you x dollars at a set rate which you can use to price stock etc. with currency fluctuations removed from the equation.
As far as I can remember, you are charged for the USD as you use them rather than up front, but you will have to buy the full value of the USD FC on or before the due date wether you use them or not.
Any outstanding USD would need to be purchased and converted back to Euro when the F/C is settled on the due date.

In relation to payments, you could use the USD F/C to purchase USD bank drafts which would only cost a few euro, but would require clearance time on the suppliers end.
Alternatively you can use the USD F/C to fund a telegraphic transfer directly to the suppliers bank accounts, but this is usually charged out at a set fee + % of the transfer value and may work out more expensive.

Foreign currency accounts are generally not that sophisticated and the most you would probably be able to get would be a USD chequebook which will be drawn on a US office of the issuing bank and would still be subject to your bank's fees as well as
clearance by the supplier prior to dispatch of the goods.
99charlie
 
Thanks for that 99charlie, some good options to ponder there
 
You must log in or register to reply here.
Back
Top