Dan Goodwin and Mark O’Sullivan: Challenges working with international payment providers

05 Jan 2024 Expert insight

The COO and CEO at IPT Africa investigate some of the main challenges for charities when it comes to international payments…



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INGOs account for anywhere between 4,000 and 16,000 charities in the UK, therefore making international payments an imperative part of the humanitarian and development aid distribution process. Financial service providers such as banks and non-bank financial institutions are the underlying delivery mechanism for moving money overseas, and particularly into difficult and high-risk jurisdictions.

Civil Society’s June 2023 article detailing the Charity Commission’s “growing sense of worry” about banking services, again highlighted the ongoing frustrations of the charity sector with banks and non-bank financial institutions. With calls from the Commission for the finance sector to “step up their levels of customer service” and “better understand the nuances and diversity within the charity sector”, IPT Africa, set out to explore these issues through a finance lens, specifically from an international payments’ perspective.

Interestingly, following an IPT Africa survey conducted in December 2023 through Charity Finance, 37.5% of survey respondents had felt let down by their international payments partner in the past, with 62.5% of charities experiencing an “average” at best relationship with their provider. Considering the dependency INGOs have on the financial system to deliver mission-critical funding, this statistic raises questions around the reliability of financial service providers to support INGO payments.

When asked around the biggest challenges facing charities working with international payments providers, 71.43% highlighted “compliance overkill” (in the context of managing sensitive payments, account opening and due diligence) as the main hurdle, suggesting a lack of appreciation and understanding around the complexities and nuances of INGOs and their work from financial institutions – coupled with an overbearing “risk-first” approach. Moreover, 42.86% acknowledged poor or lack of customer service as the second biggest challenge charities face when something goes wrong with sensitive payments intro fragile countries – as it often does.

Is customer service and specialist relationship management generally poor across the finance sector in the age of driving to all things digital and online? Possibly, although one could argue that it’s a case of “you get what you pay for” with 71.43% of charities prioritising cheap currency and low fees above all else when searching for a payments provider. Whilst an understandable “do more with less” ethos drives many charities to consider pricing as a priority, this can be to the detriment of any service offering they receive from a financial institution.

In parallel to our survey, IPT Africa spent two weeks on the road in December, meeting with INGOs from across the country to understand their experiences. Whilst fees and cheap currency did come up in conversation, the strong running theme was actually reliability, making sure that payments land with local beneficiaries with minimal fuss every time, plus good aftercare in the event support is required.

Time and time again, we heard stories of payments being held and rejected either by providers or downstream banks, sometimes with a reason, sometimes without and often with an foreign exchange loss that a charity must absorb. Some charities even experienced cases of verbal payment instructions on a recorded line not being carried out or even incorrect payment values being sent to the tune of 000s.

The theme of reliability resonated heavily with the Charity Finance readership too, as 57.14% of survey respondents outlined it as the second biggest attribute that they look for in a payments provider. If your payments provider isn’t reliable, surely price becomes a secondary consideration.

With such a significant level of responsibility on financial institutions to deliver INGO payments, a reliable, robust service offering should be the foundation for ensuring safe delivery of overseas funding. If this isn’t what your charity is getting from your payments provider or bank, perhaps it’s time to reconsider your relationship with them and explore reliable alternatives.


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