How to pay international suppliers without wire fees: local accounts and netting for travel agencies

To pay international suppliers without wire fees on every invoice, hold local-currency balances abroad. Pay each supplier over its own country's domestic rails (ACH, SEPA, Faster Payments) instead of a SWIFT wire. Then net what you owe against what you're owed, so only the difference moves and gets converted. Fewer wires, fewer conversions, faster arrival.

Local accounts cut the cost of each payment. Netting cuts the number of payments. Here is how each works, a worked example, the risks, and when it pays off.

What is netting?

Netting means offsetting what you owe against what you're owed, so only the net amount changes hands. The Committee on Payments and Market Infrastructures (CPMI) at the Bank for International Settlements has the standard definition. Netting is the offsetting of obligations between or among participants, which reduces the number and value of payments needed to settle a set of transactions.

There are two kinds:

• Bilateral netting is between two parties. The CPMI calls it the offsetting of obligations between two parties. Example: you owe a destination management company (DMC) for a tour, and the same DMC owes you a commission. One net payment replaces two.
• Multilateral netting is among three or more. Each participant ends up with a single net position, whatever the number of underlying payments.

Netting needs an agreement. The CPMI's older definition describes bilateral netting as an arrangement between two parties to net their bilateral obligations. If a supplier hasn't agreed to offset, you pay the invoice in full and collect your commission separately.

What are local accounts and local payout rails?

A local account is a balance held in another country's currency, with bank details from that country. Payers send money to it as a domestic transfer, and you pay out of it the same way.

These accounts come from payment providers. The claims below are from the providers' own pages, so treat them as vendor sources.

• Wise Business gives you account details that anyone can use to pay you just like they'd pay a local, in currencies including GBP, EUR, USD, AUD and CAD. Wise says its model works from a local bank account in one country to another local bank account, but money never crosses borders.
• Airwallex says it has connections to local clearing systems in over 120 countries/regions, and describes local payouts as faster and cheaper than SWIFT.
• Stripe Global Payouts lets you pay recipients in their local currency in more than 160 countries. Its cross-border payouts can run on ACH, Faster Payments (FPS), SEPA or SWIFT.

"Local rails" means the domestic payment systems: ACH and Fedwire in the US, Faster Payments in the UK, SEPA in the euro area. For background, see how SEPA Instant works and how SWIFT transfers work.

Why are international supplier payments slow and expensive?

A cross-border payment is one where the payer's and the payee's financial institutions are in different jurisdictions. Those payments run into known frictions.

The Financial Stability Board (FSB) lists them: fragmented data standards, compliance checks, different operating hours across time zones, and legacy technology. It adds that the length of the transaction chain can add to costs and delays, depending on the corridor.

Wires reach the bank fast but the customer slowly. SWIFT's own October 2024 figures say 90% of cross-border payments over its network reach the destination bank within an hour, but only 43% reach the end customer's account in that time. SWIFT puts the gap down to opening hours, regulatory requirements and local practices at the receiving end.

The G20 is working on it. The FSB's targets aim for retail cross-border payments, including business-to-business, to cost no more than 1% on average by end-2027, with 75% available to the recipient within one hour. Those are goals. The FSB's 2025 progress report says satisfactory improvement at the global level is unlikely in line with the 2027 timetable.

SWIFT wire vs local payout at a glance

Where does the money go in a currency conversion?

Every conversion has a price, even when the transfer fee is zero. Providers often build part of it into the exchange rate. Airwallex's terms say it may charge a mark-up on the conversion plus transfer fees. Stripe shows estimated fees and an exchange rate quote before a cross-border payout.

That is why the number of conversions matters as much as the fee per wire. Money that arrives in euros and leaves in euros never needs converting. Stripe notes that a payout in a currency other than the main currency of the recipient bank account's country incurs a fee.

How local accounts and netting work together: a worked example

Illustrative numbers only. No fee rates are assumed. The point is how much money has to be wired and converted.

A US agency sells Italy trips. This month:

• European travelers pay the agency €40,000.
• Italian hotels and guides are owed €55,000 across six invoices.
• One Italian DMC is owed €20,000 of that, and it owes the agency a €3,000 commission.

Without local accounts. The €40,000 from travelers is converted into dollars when it arrives. Later, the agency converts dollars back into €55,000 and sends six SWIFT wires. That is €95,000 converted and six wires paid.

With a euro local account. The €40,000 lands in euros and stays in euros. The agency converts only the shortfall, €15,000, in one conversion. The six invoices go out over SEPA from the euro balance.

Add bilateral netting with the DMC. If the DMC agrees to offset, the agency pays €17,000 instead of paying €20,000 and waiting for €3,000. Now only €52,000 leaves the euro balance, so the agency converts €12,000 up front instead of €15,000, and doesn't wait for the commission to come back.

Whatever your provider charges per conversion, it applies to €12,000 instead of €95,000.

What are the risks and limits?

Currency exposure. A balance held in euros changes value in dollars every day. What this means for agencies: keep only what you need for upcoming supplier payments, and convert the rest on a schedule you choose.

Provider licensing. You're trusting a payment company, not always a bank. Wise says it is a Money Service Business registered with FinCEN, not an FDIC-insured bank. Under US rules, most money services businesses must register with the Treasury. Check who holds your money and under which licence in each country.

Coverage gaps. Not every corridor has local rails. Wise issues local account details only in the currencies on its coverage list, and Airwallex uses local networks only where possible. Some features also depend on where your business is based. Stripe Global Payouts, for example, is available to US and UK businesses, with EU countries in private preview.

Netting needs paperwork. Offsetting a commission against an invoice changes what both sides record. Agree it in writing with the supplier, and keep the gross amounts in your books.

When is it worth it?

Set up local accounts when you pay the same foreign suppliers every month, when travelers or partners also pay you in that currency, or when wire fees eat into small invoices.

Add netting when a supplier both bills you and owes you commission, and you settle with them often.

Stick with SWIFT when you pay a country once a year, when the corridor has no local rails at your provider, or when a supplier insists on a wire.

How Tripdash handles supplier payments

Tripdash Pay supports authorization holds, ACH, SEPA instant, SWIFT and local-account netting, and traces each payment from the traveler to the exact supplier that received the funds. See how Tripdash Pay works. For the collection side, read how travel agencies collect payments.

Sources

1. Bank for International Settlements, Committee on Payments and Market Infrastructures. CPMI glossary: entries "netting" (April 16, 2012), "bilateral netting" (September 1, 2016 and June 1, 2015 versions), "multilateral netting" (September 1, 2016), "cross-border payment" (September 1, 2016).
2. Financial Stability Board. Enhancing Cross-border Payments: Stage 1 report to the G20, Executive summary, April 9, 2020.
3. Financial Stability Board. Targets for Addressing the Four Challenges of Cross-Border Payments: Final Report, October 13, 2021.
4. FinCEN. Money Services Business definition.
5. Wise (vendor). Business coverage: local account details, accessed October 2026.
6. Wise (vendor). What is Wise and how does it work in Ireland?, updated January 16, 2026.
7. Wise (vendor). Wise Business, accessed October 2026.
8. Airwallex (vendor). Business transfers, accessed October 2026.
9. Airwallex (vendor). Market and infrastructure coverage, Global Accounts table updated August 15, 2025.
10. Stripe (vendor). Global Payouts.
11. Stripe (vendor). Send money (Global Payouts).
12. Stripe (vendor). Settle in additional currencies.
13. Swift, via The Asian Banker. Swift cross-border payment speed surpasses G20 target, October 18, 2024.
14. Financial Stability Board. G20 Roadmap for Cross-border Payments: Consolidated progress report for 2025, October 9, 2025.