Set Up International Payment Processing for the US

There are important points you must consider when setting up international payment processing.

Before you can generate international payments, do the following.

Verify that the International ACH Transaction (IAT) standards apply to your transactions.
Create an international organization payment method, and attach it to a payroll.
Ensure that a primary mailing foreign address exists for the payee.
Create an international personal payment method for the payee.

You can use the Batch Loader process to add a personal payment method and provide country-specific bank account details for them
Consider how the foreign exchange type may impact currency conversions during the transactions.

For further info, see the following sections.

Do These Standards Apply to Your Transactions

IAT is the Standard Entry Class (SEC) code for the US Automated Clearing House (ACH) network. Employers use the ACH network for electronic payments and transactions.

Use IAT for any transaction involving a financial institution located outside the territorial jurisdiction of the United States. The US may be involved in the processing or settlement of the transaction.

Any ACH transactions you want to perform must use the IAT SEC code in these instances.

For example, these standards apply if your organization is any of the following.

Non-US headquartered company with US operations
US company with pensioners or employees located outside of the US who could potentially have funds forwarded to a non-US financial institution
Third-party sender or payment aggregator
US company with suppliers located outside the US
US company receiving ACH credit entries from offshore entities

Create an Organization Payment Method

Use the Create Organization Payment Method task to define an organization payment method (OPM) for international transactions.

This OPM must have the following settings.

Field name	How you use it
Payment Type	Select International Transfer.
Bank Reference Type	Identify the immediate destination identification.
Bank Name	Identify the immediate destination name.
Company Reference	Identify the immediate originator name.
Payment Reference	Enter the value to appear as the Reference Code in the IAT file's header record.
Report Category	Select Standard International EFT to identify this payment method as being a foreign transaction.

Confirm the Primary Mailing for the Employee

For a payee to receive payments through the IAT process, they must have a foreign Primary address. The address must include the city, state or province, country, and postal code. The country of this address must be outside the United States.

Set this address through the Person task.

Create a Personal Payment Method

Use the Personal Payment Methods task to define a personal payment method (PPM) for your international transactions.

This PPM must have the following settings.

Field name	How you use it
Bank Name	Specify the name of the receiving Depository Financial Institution to be used in the Fifth Addenda Record.
Bank Account Number	Specify the receiver's bank account number.
Routing Transit Number	Identify the bank identification number of the Depository Financial Institution maintaining the receiver's account. This can be: Nine-digit American Banking Association (ABA) routing and transit number Eight or 11-digit Business Identifier Code (BIC) code
SWIFT	For countries that use Society for Worldwide Interbank Financial Telecommunications (SWIFT), identify the bank identification number of the Depository Financial Institution maintaining the receiver's account. To determine the appropriate SWIFT or BIC codes for an employee's account: Check online. Many major institutions post these codes, which identify the bank location and branch. Contact the bank branch directly, and ask for the correct codes to use.
IBAN	For countries that use an International Bank Account Number (IBAN), identify the bank identification number of the Depository Financial Institution maintaining the receiver's account. To determine the appropriate IBAN codes for an employee's account Check online. Many major institutions post these codes, which identify the bank location and branch. Contact the bank branch directly, and ask for the correct codes to use
Foreign Payment	Describe the origin of the entry, so it can be displayed to the employer.
Country	Specify the receiver's bank branch location's country code.

The fields you see depend on the country chosen in the person's primary address.

By default, all employees inherit the payroll definition's OPM. To override the default when setting up an international employee, you must create an international PPM and select an international OPM.

Consider How the Foreign Exchange Type May Impact Currency Conversions

Use the Fixed-to-Fixed foreign exchange type to calculate values for international transactions.

In the Fixed-to-Fixed exchange type, both the input and output amounts are calculated in US dollars. Currency conversion doesn't occur as part of this exchange type.

For example, your company has an employee abroad, and you pay a monthly stipend of $1000. The amount is to be deposited to the employee's foreign bank account in USD. Your company originates each ACH transaction for $1000 from the employer bank account in USD. Then your company requests the bank to transfer the amount to the foreign bank account. The banker deposits $1000 in the employee bank account.