Know the Figures

Cross-Border Payout Cost Stack

Every layer taken out of an international payment, added up.

Replaces: Treasury reviews and provider comparison decks

How to use it

Enter the payout and every layer that takes a piece of it. Most quotes disclose one of these; the calculator adds all of them and shows what actually reaches the other end.

Where the number comes from

  • The FX markup is applied as a percentage of the amount, because that is how a spread works — it scales with the payment rather than being a flat fee.
  • Sender, correspondent and receiving bank fees are flat amounts deducted at their own stage.
  • Withholding tax, where a corridor imposes it, is a percentage taken at source.
  • Failures are priced as an expected cost: the failure rate multiplied by what repairing one costs.
  • What the recipient receives is the amount sent less every deduction except the expected failure cost, which falls on you rather than them.

What goes wrong

The part most calculators leave out.

  • Correspondent bank deductions are genuinely unpredictable. A payment can route through one intermediary or three depending on the corridor and the day, and you find out afterwards.
  • Whether fees are shared, paid by sender, or paid by beneficiary changes who bears which layer. Getting that instruction wrong is why recipients receive less than the invoice.
  • Withholding tax depends on the corridor, the nature of the payment and any treaty between the two countries. Treat the input here as a placeholder for advice rather than a rate.
  • FX markups are frequently wider for exotic corridors, small amounts, and payments made outside market hours. A single average markup understates the worst cases.
  • Batching payouts reduces per-payment fees but concentrates FX exposure into single conversions. Which is cheaper depends on your volumes and how much rate movement you can tolerate.
  • The recipient’s own bank may convert again at its own rate, which is entirely outside your control and invisible from your side.

The 22 fee that costs 145

A business pays 120 international contractors 8,500 each. The bank quotes a 22 outbound fee, which on a payment this size looks negligible. But a 1.1% FX markup takes 93.50, correspondent banks deduct around 18, the receiving bank charges 12, and roughly 1.5% of payments fail at 45 each to repair. The true cost is about 146 per payout — 1.71% of the amount, and more than six times the disclosed fee. Across 120 payouts monthly that is roughly 17,500 a month, or 210,000 a year, of which only 2,640 was ever quoted as a fee.

Questions

Why does the recipient get less than I sent?
Because correspondent and receiving banks deduct their charges in transit, after you have sent the payment. Unless you instruct that all charges are paid by you, those deductions come out of the amount rather than being billed to you.
Is the FX markup really the biggest layer?
On any payment of meaningful size, almost always. Flat fees stay flat while the spread scales with the amount, so above roughly a few thousand the rate dominates everything else.
Should I batch payouts?
Batching cuts per-payment fees and often earns a tighter spread, but it concentrates timing risk into one conversion and delays individual recipients. The trade depends on volume and how sensitive your recipients are to timing.
Does anything I type get sent anywhere?
No. The whole calculation runs in your browser. Nothing is transmitted, stored, or logged, and there is no account to create.

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