correspondent banks, act as intermediaries in international transactions, facilitating the movement of funds between the sending and receiving banks. Each intermediary bank in the transaction chain can charge fees, which can add up, especially in cross-border payments. The size of these fees is influenced by various factors, such as the
payment pathway, the currencies being exchanged, and the regulatory frameworks of the countries involved. For instance, payments routed through a specific correspondent bank in one country may incur higher fees compared to an alternative route in another country. Similarly, certain currencies may be associated with higher processing fees due to their volatility or limited
use in international transactions. Regulatory requirements can also play a significant role, with some countries imposing additional fees or compliance costs that increase the overall expense of the transaction. For example, a UK-based payroll provider paying employees in Brazil may find that payments routed through US
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ISSUE 10 GLOBAL PAYROLL MAGAZINE
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