Concerns about international payments are stopping many UK small and medium enterprises (SMEs) from exporting overseas; according to new research by international payment solution provider Currencycloud.

New Currencycloud research, which surveyed 500 decision makers at UK SMEs, found that 28 per cent of businesses that are not already exporting overseas have plans to do so in the future – but concerns regarding international payments are preventing them from taking immediate action.

Many businesses find starting to trade internationally daunting. Currencycloud explained that respondents cited everything from worries about finding overseas customers (31 per cent) to concerns about tariffs and other charges (29 per cent) when explaining why they hadn’t yet exported.

However, 34 per cent of businesses currently not exporting said that they choose not to do so due to worries about the complexity of making and receiving international payments. Of these businesses, 51 per cent are concerned about being exposed to currency fluctuations and foreign exchange risk.

Additionally, 49 per cent of businesses are concerned about payment security, with 45 per cent worried about the speed of payments. Another 43 per cent cited the cost of making and receiving payments as being a key barrier.

Of the 51 per cent of SMEs surveyed who are already exporting, 33 per cent still find international payments a challenge. However, dealing with tariffs (45 per cent) or customs and red tape (43 per cent) emerged as bigger issues for them. This finding suggests that businesses that are not yet exporting are underestimating the very real challenges that navigating customs and tariffs can bring.

Unlocking revenue through exporting

With 49 per cent of small businesses not currently exporting, providers could help alleviate their concerns and overcome perceived payment barriers to potentially unlock considerable revenue.

Currencycloud revealed that high street banks are already in a prime position to do this. Forty-six per cent of those SMEs already exporting surveyed use their high street bank or building society to send and receive payments, and 34 per cent of all respondents have tried to access support with exporting from their banks.

Piers Marais, head of product at Currencycloud, commented on the findings: “These figures show that international payments are a key concern for businesses looking to export overseas. However, it’s also clear that there’s a growing appetite to export and that banks are in a key position to support SMEs.

“So, we need to move away from the standard ‘banks vs fintechs’ rhetoric and focus more on how the industry can collaborate. It’s also clear that if the Government wants to boost Britain’s global business ambitions, it needs to take concerns around red tape, customs, and tariffs seriously”.

The President of Brazil, Luis Inácio Lula da Silva, has signed a law introducing the taxation of crypto assets held abroad by the country’s citizens. 

Lula signed the law on Dec. 12, which was then published the following day in the official Gazette of the Union. With some reservations, the law will come into force from Jan. 1, 2024.

The new taxes will not apply exclusively to crypto but also to profits and dividends gained by Brazilian taxpayers from investment funds, platforms, real estate or trusts abroad. The Brazilian government intends to collect around 20 billion reals ($4 billion) of new taxes next year.

Related: IRS lists 4 crypto crimes among its top cases in 2023

Those who begin paying the taxes this year are being offered an early-bird advantage: they’ll pay a levy of 8% on all income made up to 2023 in installments, with the first installment beginning in December. Starting next year, the tax rate will be set at 15%. Overseas earnings up to 6,000 Brazilian reais (~$1,200) will be exempt from taxation.

Speaking to Cointelegraph, João Carlos Almada, Controller at Transfero, a Brazilian stablecoins issuer, explained that the taxation of digital asset income is not exactly something new to the country. However, there are aspects of the law that could use some clarification:

“Some points in the text need improvement, for example, compensation for losses in the period, something similar to the tax rules for stock assets. I believe that with regulation evolving in the country, we will go through new discussions on this topic, aiming to provide even greater transparency to the market, thus generating more credibility.”

Brazil isn’t the only country that’s been eyeing the overseas crypto holdings of its citizens. In November, the Spanish Tax Administration Agency also reminded its citizens about their obligations to declare crypto stored overseas. However, that demand concerns only individuals with balance sheets exceeding the equivalent of 50,000 euros (around $55,000) in digital assets. 

Additional reporting by Cassio Gusson

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