What Payment You Prefer In International Business - Paypal, Western Union Or Telegraphic Transfer

Why International Seller Or Supplier Don't Accept Paypal As A Common Payment Option? Maybe this problem arise when you want to place an order with a China seller because majority of them don't accept Paypal payment.

China seller prefer to do a business transaction with either Telegraphic Transfer(T/T) or Western Union and not Paypal payment. There all are reason behind this. As a seller also i don't really like to use Paypal as my payment gateway.

Let's summarise the issues with this common Payment problem:

- For suppliers: how can the Supplier find a widely usable payment system that encourages trust from the Buyer and also does not impose high costs? Lower cost to Seller that can maximize the profits.

Seller prefer Telegraphic Transfer or Western Union because they want to minimize their lose when received the payment. With TT and Western Union payment seller doesn't have to pay any cost to get the payment or just pay lowest fees only. Because all the cost beared by Buyer.

But if the seller use Paypal as a payment option he will get more buyer confident and gain a trust from buyer.

If use Paypal, seller must incur all Paypal transaction fees.

- For foreign buyers: how can the Buyer make payments easily and quickly to supplier or Chinese firms, without incurring high costs to themselves, and with some degree of fraud protection?

International buyer seek to use Paypal because they don't have to pay any fees and they have high degree of fraud protection give by Paypal.

Below I will summarize some pros and con use all these payment system.

Telegraphic Transfer/Western Union

Pro:
-Universal system
-Guarantees payment for Seller
-Preferred method choose by seller

Con:
-Both sides may incur charges
-Many buyers lack experience
-Leaves the buyer entirely at risk
-High charge to Buyer if use Western Union (not preferred).


Paypal

Pro:
-Widely available; accessible for newcomers to international trade
-Fast payment
-Easy to use for the Buyer; accepts credit cards
-Excellent Buyer protection
-Arguably increases trust due to recognition factor / association with Ebay

Con:
-Exposes the Seller to significant risks
-High fees for the Seller
-Paypal is a very common target of online payment fraud

There is no universal answer, but in my opinion, Paypal is the best option for orders under USD 2000, mainly because of being instant payment and offering the Buyer total insurance against non-delivery. The same caveats about establishing trust and starting with small test orders apply to Paypal as they do with any payment system. Any Buyer should research the Seller before sending money, and the Seller also needs to inspect received orders carefully.

It would be great to hear other importer/ exporters' experiences with these payment methods!