OFX – Global Money Transfers Provider

September 29, 2018

OFX can offer you local currency accounts in USD, EUR, GBP, CAD, NZD, AUD and HKD allowing you to save significantly on transaction fees and margins when bringing your revenue home from international marketplaces like Amazon or using that revenue to pay suppliers. You’ll benefit from $0 setup or ongoing maintenance fees for accounts, $0 OFX transfer fees on currency conversions, and preferential exchange rate margin of 0.85% or less.

List of questions covered in this video:

00:18 What does OFX company do and what problems does it solve for Amazon sellers?
01:23 Do you have any other things on offer for the market place sellers?
03:44 And If someone is expanding outside Amazon, can they receive payments from their website and other market places?
05:06 In what countries do you operate? and sellers from which countries do you accept? and bank accounts of which countries do you provide?
06:30 And what are the requirements for these regular countries to join OFX?
07:17 Why someone would choose OFX instead of other service providers in the market?
09:12 And how long does it take to set up everything If I send them today as a business? And how long do I need to wait until I can operate payments from Amazon to your service?
10:21 Do you face any troubles when people change their bank account?
11:53 When your customers receive payments from the marketplaces, they can use this money not only to cash out or send to the company account, but also to pay, let’s say suppliers, right?
13:29 Do you have any tips for sellers when they are paying overseas suppliers?
16:25 What are the fees when someone is using your service?
17:52 Can you show us how does OFX user interface works? How can people initiate transfers and check their balance?
21:12 How do you transfer between your OFX accounts?
21:38 Can you share with us a little bit of what’s happening in Australia with Amazon ?

Transcript – Introduction to OFX

[00:00] Augustas: Are you looking for a service provider to transfer money internationally where fees are reasonable? Check out my interview with Ed Wiley from OFX – the global money transfers company.[00:17] Augustas: Hello Ed.

[00:18] Ed: Hello Augustas, how are you doing?

[00:18] Augustas: I’m good. Thank you. Can you introduce to us OFX company, what does it do and what problems does it solve for Amazon sellers?

[00:28] Ed: Yes. OFX is an international payment company. We help sellers pay suppliers internationally. And bring home the Amazon revenues. So what we do in that case is pretty much once they set up an account with OFX, we issue them overseas bank accounts where they’re selling. So if you’re based here in Australia, like I am, predominantly, you would usually start in the U.S market and would issue a U.S dollar bank account with Bank of America. And then you can upload that bank account to the US marketplace, and then receive those funds and then use those funds to either pay your suppliers in China in U.S dollars, or bring back your revenues to Australia. So that’s pretty much in a nutshell. So that has trot over to you for the next question.

[01:23] Augustas: And besides providing different bank accounts from different countries, do you have any other things on offer for the market place sellers?

[01:35] Ed: We kind of integrate into the marketplace. Then you receive your revenues. We don’t integrate too much of the marketplace except we do plug into their API to speed up the payments coming through. We’re looking to launch a few more products down the line. But predominantly, it’s just the bank transfers the reason why someone use us over just receiving funds directly from Amazon. Because Amazon typically charge around 3.85% to 4% when they convert your funds back to your home currency. So directly, if I was based in Europe, I’m in all selling on the US platform and I just provided them my Euro account. Amazon will convert those U.S dollars to Euros and in no charge, so 3.85% to 4%. And then most of your suppliers probably, if you’re selling from Europe will be in China, so you would actually have to use your bank or OFX service to send your funds back to China from Euros back to U.S dollars.

[02:41] Ed: So what we do is we kind of cut out the middleman. We give you the U.S dollar account, then you can use your U.S dollar to the then pay your suppliers directly. So you say on that double conversion fee. When you are kind of expanding and you’re going into multiple markets, that’s when it gets interesting. We have a number of clients who want to play the game of foreign currency where they hit you out their exposure. So If Brexit happens, a hard Brexit, and the pound falls dramatically. They want to be out of lock in the exchange rate for the years worth of sales or the six month worth of sales. So we do offer Hedging products. A few other services don’t, were we can lock in the exchange rate, say for $500,000. If you’ve got $500,000 of revenue over the year and you liked the exchange rate today, we can lock that in today. So you know exactly how much you’re going to receive over that year.

[03:44] Augustas: And if someone is expanding outside Amazon, can they receive payments from their website and other market places?

[03:51] Ed: Yes, definitely. We’ve got a lot of people who are connected to Shopify, so it’s kind of one of those services that a lot of Amazon sellers are adding on top. So the expanding of Amazon, I’d say probably around 80% of our clients now are selling on their website as well, or driving traffic through their website. So we link up to Shopify payments and Paypal. So you can actually use the U.S dollar account and you can link it up to Paypal and Shopify payments, or if you are selling on other marketplaces like Wish or Rakuten, you can actually link up those bank accounts to those places. Hopefully, as your business scales and it grows and it gets kind of a customer base of Amazon, you then get wholesale orders. We’ve seen that quite recently. A lot of our clients have been kind of found off Amazon, and then getting wholesale orders from traditional retail stores within the U.S and within Europe. So you can use those bank account details to provide to your wholesale providers, then you get your invoices paid. So I was saying that quite a lot lately.

[05:06] Augustas: All right, so we talked about different marketplaces. But in what countries do you operate ? and sellers from which countries do you accept ? and bank accounts of which countries do you provide?

[05:19] Ed: Yes, well, majority of our bank accounts issue to sellers based in Australia, U.S, Canada, UK, and Europe. So that’s covering all over eastern Europe as well as sellers throughout Asia. So we’ve got a Hong Kong office that covers both China and right to Hong Kong. If you were doing over $25,000 a month or $20,000 a month, we can onboard you if you’re in countries like India, Malaysia, Vietnam, but if you’re doing under $20,000 a month, we usually don’t onboard clients from more exotic countries such as Malaysia and Vietnam. We usually leave that to companies like Payoneer who kind of specialize in the more exotic countries. So we specialize in more of Anglo Saxon areas. So we’ve got an office in Singapore, Hong Kong, Sydney, Oakland, London, Toronto and San Francisco. So it covers that whole European base, as well as the Southeast Asia and then into North America’s.

[06:30] Augustas: And what are the requirements for these regular countries to join OFX?

[06:35] Ed: Yes, so you can sign up as a sole trader or sole proprietor. That’s just an individual seller. So if you’re just getting started out, you just need your tax file number on that one. Then once you grow, if you’re a company, you would just need your company registration number. So we’ve got lots of proprietor, limited companies, LOC’s, so depends if you’re just starting out, you can sell as a individual. But you do have to have some sort of company structure as individuals such as a proprietor, or a sole trader, and then it goes all the way up to public listed companies such as, if you’re listed on the stock exchange.

[07:17] Augustas: So, we’ve heard already a little bit about OFX, but why someone would choose OFX and knowing that there are a couple of other similar service providers in the market ?

[07:30] Ed: Yes, we were probably a bit late to the game when it came to launching our service. But when we entered we kind of entered quite tight on the exchange rates. So traditionally most FX providers such as the other ones like Payoneer. We are charging around the 2-3%. They were definitely cheaper than Amazon, so it’s not the worst decision. They are easily available for countries, like say if you’re selling from Malaysia or India, but we want to target the larger in scale sellers, so if you’re selling over $20,000 a month that is our kind of clientele we are after. So we were offering much better exchange rates than that. So our maximum exchange rate that we usually provide for our clients is 0.85%.

[08:25] Ed: Then that goes all the way down to 0.25%. If you are selling a couple million a year, we can offer very tight exchange rates, just because we’ve got scale. We are publicly listed on the Australian Stock Exchange. So last year we did over $20,000,000,000 in obviously these payments. So that allows us to kind of pull all our clients payments together, and then offer better exchange rates to our clients. We kind of entered late, but we kind of went after a niche of the larger clients not like the really startup ones, whom kind of Payoneer help out. And we kind of want to target with a bit of pricing for those larger in clients.

[09:12] Augustas: And how long does it take to set up everything if I send them today as a business ? And how long do I need to wait until I can operate payments from Amazon to your service?

[09:24] Ed: Yes. So typically if you’re a sole proprietor, you can get pretty much set up overnight. If it’s a company we require you to sign, just complete this sign form. So that usually takes the compliance team to verify another day. So that’s two days. And then it really depends on how fast you get that form back to us. So we get some companies who take a week or two because they need to get the director to sign it. But then majority of our Amazon sellers are run by single directors or cell phoned, so that’s pretty quickly to get the turnaround. Um, yeah. So it can get all sorted up within one or two days.

[10:10] Augustas: And some people in Europe, some sellers were concerned about changing their bank accounts in the Amazon account. Can you comment on that?

[10:21] Augustas: Do you face any troubles when people change their bank account?

[10:25] Ed: Yes, really good question because it does come up a lot. I think it kind of got solved when they turned on the two factor authentication requirement before there was the two factor authentication. If you change any of your personal details or anything on your Amazon account, there was a high chance Amazon would just go, “hey, can you please verify these things?”. But now they’ve got the two factor authentication and here there’s a lot more trust from Amazon when you do change any information. I personally sell on Amazon, so I’ve changed my bank account multiple times. I haven’t actually had any issues with Amazon. However, when I did update my bank details, they wouldn’t pay out to that bank account until I just updated the bank details again. So what that means is, you uploaded them online, then they send you a message and they say, “Hey, can you please reconfirm that bank details that you entered ?”. And so you just log in again and you just re-enter the bank account number. And that was the only thing I found. We haven’t had any issues updating the main details and probably about a year and a half and that corner when they changed the two factor authentication requirement. So I think that kind of issue has been solved, but Amazon is a changing target. So you never know what’s going to happen with those guys. So I’ll leave it up to them to have the final say.

[11:53] Augustas: All right. Then of course, when your customers receive payments from the marketplaces, they can use this money not only to cash out or send to the company account, but also to pay, let’s say suppliers, right?

[12:07] Ed: Yes, that’s correct. So if you do receive your revenues, what we’re saying probably, when you’re just starting out as a company, you probably want to reinvest all your revenues back into more stock to grow your company. So we’re seeing a lot of our consumers or clients reinvest all their funds from Amazon back into extra stock, so they hold their funds with us and then when they’re happy to pay their suppliers, they have those bank details saved on their account, and then I just transfer it out online. When you’re obviously scaling your company and you got to a certain point where you pay yourself a salary, you can bring home your excess funds. And a lot of people do pay other services like getting their photos done, got their 3PL services so they can pay that out there. We have a minimum transfer size of $250. So if you do need to go lower than that, you can. It’s just, if you keep on doing it, we might need to increase your fee because there is an associated costs of that, but we typically don’t. And in these no maximum. We’ve got some clients who are doing multiple multiples of millions of dollars through their accounts. So there’s no a maximum transfer.

[13:29] Augustas: Do you have any tips for sellers when they are paying overseas suppliers?

[13:35] Ed: Yes, that’s probably one of the biggest questions I always get asked and corner one of the most nervous thing when you’re a startup or you’re dealing with Chinese suppliers, you’ve never met them. You’ve never seen your products like actually once it’s manufactured and it goes straight to Amazon. And it is a scary moment when you hand over say a $10,000 worth of money to your supply. The number one thing is making sure you have a trusted relationship with your supplier. So that all starts from the supplier stage and try to ask them as many questions as you can around your product and making sure they understand what your product is and that they manufacture the type of products that you are looking to manufacture. So we get a lot of people who kind of jump into the Amazon side of things and the idea with probably no manufacturers who kind of manufacture a lot of different items where they don’t specialize in the producing.

[14:37] Ed: So they might start something up along the way. So that’s the first step. Once you’ve found your manufacturer, then it’s verifying their bank details and that’s on the first deposit payment. So you can do that through Alibaba trade insurance. When you’re Alibaba trade insurance, you can pay through all fixed by clicking on the PYTT, and then you’re secured via Alibaba trade insurance, but you also want to use that inspection agent to do the final quality check. With the bank details sent to China, they’ll go to over a billion of people. So just make sure that the account name exactly matches what they’ve provided you and it’s the company that you’re dealing with. So it’s not a personal bank account and that there’s actually a company bank account, because if it’s a personal account, it is highly likely there’s something dodgy going on.

[15:30] Ed: Then the last one, if you do actually receive an email of changing bank details, that is extremely unlikely to happen. Make sure you triple check with your supply all those bank detail changes that happens every month though. So a client or supplier’s email was hacked and then they pretty much sending out a mass email to all their clients saying we’ve updated our bank details that those funds are very hard to get back. We did have a client who successfully got his funds back last week actually. So that was a of a happy moment, but it is really daunting when those funds do go astray. So make sure that the bank details are correct and you’re sending to the right bank.

[16:25] Augustas: The fees of over fixed, Could you just talk one more time about what are the fees when someone is using your service?

[16:33] Ed: Yes, sure. There’s no set up fee, there’s no ongoing fee. So pretty much once you set up an account OFX, there’s no kind of like set up for your ongoing fee. Once it’s set up, we only charge you once you withdraw funds from the account or when you use us to pay your suppliers. Where we make our money, is within the exchange rate. So we charge 0.85% all list than the interbank exchange rate. That’s a Bloomberg or Reuters, so you can actually save every time you make a transfer of OFX because banks typically charge around 4%, so you are saving just over 3% when you do use OFX. We do offer discounts depending on how much you’re selling. So if you are doing over say a $10,000 a month, we might be able to go down to 0.75. if you doing over $25,000 we would go down to 0.65. If you doing over a $50,000, we might go down to 0.5, so it goes down as you scale your business. So we kinda like to see businesses grow and we want to be able to support them as they grow their business.

[17:52] Augustas: Very competitive rates you’re offering. And can you show us how does OFX user interface works? How can people initiate transfers and check their balance?

[18:04] Ed: Yes, sure. I can show you my account. So this is pretty much the screen when you first log in, so you can either create a new recipient or a new transfer. So this is pretty much when you’re just starting out as a new OFX client, you probably don’t have any money in your account. So you probably just want to use your existing balance in Australia so I’ll use my Australian dollars and I want to pay my suppliers in china, so just change that to Australian dollars.

[18:34] Ed: So update, so I would just update live for the market. So if I want to transfer those funds, it would change. So it’s pretty much an overnight transfer to China. Then I can pull down a bank account details that I’ve already got saved or I can just create a new recipient directly in my account. And then this will change depending on what country you’re sending to. So the fields will change for each country. So it’s pretty dynamic in the way that happens, but we’ll skip off that. So that’s just when you need to make payments to your suppliers, so it’s pretty much saved in there for when you need a Pay next time, but that’s when you’re just getting started. But I’ll click up here to the global currency account. You can see your payment history of funds coming all in U.S dollars because myself, I’m only selling on the US market and I just stopped the other day.

[19:40] Ed: When you got a balance in here, so $186 , you can click on transfer, and then you say, I want to transfer from this bank acccount. You can have multiple U.S dollar accounts within your global currency account or you can have multiple currencies. So if I want to transfer to say Markethustl, so user gets a $100, so right there, as you can see it’s, a 0.5% margin. And so I get charged 50 cents of doing $100 transfer. If I click finalize that would just go straight through to my supplier and that’s pretty much all it is. So if I want to transfer back to my Australian account, that can do that, and will update to the actual exchange rate for U.S dollars to Australian dollars.

[20:40] Ed: So it is very basic and that’s what we kind of want to keep it. So if you’re a larg company and you’re selling in multiple marketplaces, you would have say, U.S dollars, Canadian dollars, Euro, and it would drop down just because on selling into the U.S market at the moment would only show the U.S dollars and then you can just download your transaction history if you do need to connect it to Xero or an accounting platform, you should be able to get your funds out.

[21:12] Augustas: And how do you transfer between your OFX accounts?

[21:18] Ed: If I have multiple bank accounts, that would appear here. So I’ve just got a one U.S dollar account, but if I had a U.S dollar in Australian dollar account, I could just clip that U.S dollar in Australian dollar account. Then I would transfer between those accounts.

[21:38] Augustas: Alright yes, thanks for showing how OFX works. You mentioned about selling on Amazon, and knowing that OFX is from Australia, can you share with us a little bit of what’s happening in Australia with Amazon ?

[21:52] Ed: It’s pretty quiet at the moment. Strategy market kind of went off like the Big Bang and then there was a big publicity around it. It’s kind of moving in its own pace. Australia hasn’t really jumped onto the Amazon bandwagon just yet. But I think it’d be a one year’s time or two year’s time, when everyone will probably be saying, I wish I got on there at the start. So right now Amazon actually aren’t charging any fees to sell on Amazon in Australia. And they doing free FPI to October, so that’s just trying to get sellers on there and are offering incentives for sellers to jump on the platform.

[22:36] Ed: The one awesome thing about Amazon Australia is no fees and that means there’s no PPC as well, so you don’t have to pay out of the air a PPC fees, but the problem is you don’t have much traffic. So what I would say, if you are a large seller or if you’re a new seller, I would only sell real items that people would typically always buy. I wouldn’t sell anything really nichey products. We would only sell kind of items that are already selling on Amazon in the U.S. I have got over a thousand reviews, because just the same products that might be selling a thousand products or more amount in the U.S may only have one review here in Australia. So it’s pretty much whoever gets in first, have that first mover advantage.

[23:36] Ed: In winter at the moment in Australia, people don’t buy too much stuff in winter, so when it moves into summer you’ll see a lot more people buy those, blow up pool accessories. I think they are going to take off on Amazon, so that’s a little hint and obviously Australia has a very long summer, so if you do think about selling stuff into Australia, probably remember that, because it’s 25 degrees today and I’m wearing a jumper thinking it’s was cold. And that’s pretty much the end of winter. So that’s the Australian market. It’s quite young at the moment, but you do have a first mover advantage. So if you have got a few bit of spare cash or if you’re a large seller and you just want to taste the market, probably sell stuff that you know is going to sell and just go after the market being first in, first in.

[24:36] Augustas: Great. Thank you very much Ed for this OFX introduction and the tips for Amazon in Australia and good luck in the business. Bye Bye.

[24:45] Ed: Perfect. Thank you.

About the author 

Augustas Kligys

Augustas Kligys is the founder of Orange Klik and has been delivering in-person and virtual events for Amazon sellers since 2016, including European Seller Conference, Seller Fest and PPC Congress.

Known in the business as the "Amazon Summits Guy", Augustas helps Amazon sellers achieve success through delivering expert sessions and online guides.

Focused on helping Amazon sellers build and scale their business, Augustas has spent the last years developing an industry-leading knowledge base, with over 500 sessions featuring Amazon industry leaders, experts, speakers and tools.

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