Why did I receive less than I invoiced?
Because the cost of a cross-border payment arrives in pieces, from parties you did not choose, and the largest piece is rarely presented as a fee at all.
You invoiced $1,000. Two weeks later, $940 landed. You go looking for the missing $60 and find that no single party charged you $60. Three of them charged you something, one of them never told you it existed, and the biggest deduction wasn't labelled as a charge.
This article maps all of it, and gives you the arithmetic to work out what your own setup is costing you.
Where does the money actually go?
Money leaves at up to four points, and most people only budget for one.
The sending side. Whatever the payer's bank or platform charges to initiate the transfer. Sometimes your client absorbs this and sometimes they deduct it from your invoice, which is worth settling in writing before the first payment rather than after.
The currency conversion. Usually the largest deduction, and almost never presented as a fee. The next section covers this in full.
Intermediary banks. On a traditional wire, the money may pass through one or two correspondent banks that have no relationship with you and no obligation to disclose anything in advance. Each can take a handling charge from the amount in transit, and published examples put the combined deduction in the tens of dollars. You find out by subtraction.
Your receiving bank or account provider. A charge for accepting an inbound international payment, and sometimes a second charge for converting it. Some accounts charge nothing here. Others charge a flat amount regardless of how much arrived.
Four charge points, and only one of them appears on the page you read before agreeing to the deal.
What is the spread, and why doesn't it look like a fee?
The spread is the gap between the real exchange rate and the rate you were given, and it is how most currency conversion is actually monetised.
There is a real, observable exchange rate at any moment: the rate at which banks trade with each other. It's the number you see on Google or a financial site, it's called the mid-market rate, and it is not a rate anyone offers you.
What you are offered is that rate, shifted slightly against you. A provider can advertise "zero fees" with a completely straight face while taking 3% through the spread, because the spread is not a fee. It's a worse price.
To see it, you have to run the comparison yourself. Look up the mid-market rate at the moment of conversion, then look at the rate you were given. The difference, expressed as a percentage, is your real conversion cost. If the mid-market rate was 5.40 and you received 5.24, that is roughly 3%. On a $3,000 monthly invoice, that is $90 a month, or $1,080 a year, for a service advertised as free.
Nothing else in this article matters as much as that paragraph.
Flat fee or percentage spread: which costs you more?
It depends entirely on your invoice size, and there is a specific amount where the answer flips.
Take two pricing structures, both common in the market:
- Structure A: a $5 flat fee plus a 0.5% spread
- Structure B: no fee at all, plus a 3% spread
| Amount received | Structure A total | Structure B total | Effective cost (A / B) |
|---|---|---|---|
| $150 | $5.75 | $4.50 | 3.8% / 3.0% |
| $200 | $6.00 | $6.00 | 3.0% / 3.0% |
| $500 | $7.50 | $15.00 | 1.5% / 3.0% |
| $1,000 | $10.00 | $30.00 | 1.0% / 3.0% |
| $3,000 | $20.00 | $90.00 | 0.7% / 3.0% |
| $5,000 | $30.00 | $150.00 | 0.6% / 3.0% |
The crossover sits at $200. Below that amount the flat fee dominates and the percentage-based option wins. Above it, the flat fee becomes noise and the spread does all the damage.
You can find your own crossover with one line of arithmetic. Where F is the flat fee, s₁ is the lower spread and s₂ is the higher spread:
Crossover amount = F ÷ (s₂ − s₁)
Using the numbers above: 5 ÷ (0.03 − 0.005) = $200.
The practical consequence is that the right answer changes as you grow. The provider that suited you at $300 a month is quietly the most expensive option at $4,000 a month, and nothing will prompt you to revisit the decision. Most people never do.
The same arithmetic tells you when to batch your invoices. If a flat fee is hurting you, billing monthly rather than per milestone reduces how many times you pay it. Four payments of $250 cost four flat fees. One payment of $1,000 costs one.
Who pays intermediary bank fees on a wire transfer?
Whoever the charge code says, and the default setting puts them on you.
Every international payment carries a field that decides this. Banks show it to customers with the labels OUR, BEN and SHA, inherited from the SWIFT MT103 message and its field 71A. Underneath, cross-border payments moved to the ISO 20022 standard when the MT coexistence period ended in November 2025, and the equivalent field is Charge Bearer: DEBT, SHAR and CRED map closely onto the three familiar labels, plus a fourth, SLEV, where charges follow the rules of the scheme in use.
- OUR (DEBT): the sender is responsible for charges raised along the way, including those of intermediary banks.
- BEN (CRED): the beneficiary absorbs everything, and every institution in the chain may deduct.
- SHA (SHAR): each side pays its own bank, and deductions taken in the middle fall to the beneficiary.
SHA is the market default. By doing nothing, both parties have agreed that you will absorb deductions neither of you can see in advance. What each code costs, and how to ask a client to change it, is worth settling before the first invoice.
Two caveats are worth knowing, because most explanations skip them.
Does OUR mean I receive the full amount?
From the payment, largely. From your account, not necessarily. OUR stops charges being deducted from the money in transit, but it does not stop your own bank billing you for receiving an international payment. That charge is levied on you as its customer rather than taken out of the wire, so it sits outside the instruction.
Why doesn't my client's bank show a charge code option?
Because many of them never expose the field. Retail and small-business banking interfaces often don't surface a charge instruction at all and default to SHA silently. Within the European Economic Area there is a further reason: payment rules require shared charges on many transfers, so the sender-pays-everything option may not be available at all.
If your client can send as OUR, asking them to moves most of the uncertainty to their side. Many will agree without much thought, because it is a dropdown to them and a real number to you.
There is also a way around the problem entirely. SEPA Credit Transfers are handled under scheme rules that do not permit deductions from the transfer amount, so the charge code question does not arise. The same logic applies to other domestic rails. If you can receive through a local account in your client's country, the correspondent chain never enters the picture.
Sources: Swift for the end of MT coexistence; Federal Reserve Financial Services for Charge Bearer codes; Deutsche Bank for legacy field 71A.
Does it cost more to convert on a weekend?
Yes, usually, because currency markets close and payments do not.
A conversion initiated on a Saturday cannot get Saturday's rate, because there isn't one. It gets a rate the provider set based on Friday's close, generally with extra margin built in to cover the risk of the market moving before it reopens. The same applies to public holidays and, to a lesser degree, to the hours around market open and close.
You rarely control the exact moment your client clicks send. But if you are the one converting, holding funds in the original currency and choosing when to switch, then avoiding weekends and holidays costs nothing and saves a little every time. Over a year of monthly invoices, that adds up.
What should you agree before the first invoice?
Five things, all far easier to settle at the start than to renegotiate later.
- Decide which currency you are invoicing in. This determines who carries the exchange-rate risk. It is a negotiable commercial term, not a technical detail.
- Agree who pays transfer charges and write it into the contract. One sentence is enough: payment to be sent with charge code OUR, beneficiary to receive the full invoiced amount.
- Ask whether a local rail is available. If your client can pay into a local account in their own country, you skip the correspondent chain and most of this article stops applying.
- Check the spread, not the fee. Compare the rate you received against the mid-market rate at that moment. Do this once and you will never read a "no fees" claim the same way.
- Record what actually arrived for your first three payments: invoiced amount, received amount, date. Three data points are enough to work out your all-in cost, and almost nobody has them.
That last one is the heart of it. Cross-border payment costs stay invisible not because they are hidden well, but because so few people write down what arrived and subtract it from what they billed.
The fee structures in the comparison table are illustrative, used to demonstrate how the arithmetic works. Actual rates and fees vary by provider, currency pair and amount, and change frequently. Check current terms before making a decision.