Cheapest Way to Pay International Suppliers from Canada (2026)

The cheapest way to pay international suppliers from Canada in 2026 is by using Local Payment Rails (such as ACH in the U.S., SEPA in Europe, and Faster Payments in the U.K.) rather than the expensive SWIFT wire network. By utilizing a multi-currency platform like Bank on Loop, businesses can bypass the standard $30–$80 bank wire fee and reduce the exchange rate markup from the traditional 3% down to as low as 0.10%.

Key Takeaways

• SWIFT is Obsolete for B2B: Traditional "Big 5" banks use the SWIFT network, which involves intermediary banks that each take a hidden "landing fee," often resulting in your supplier receiving less than the invoiced amount.
• The "Double Conversion" Penalty: Traditional banks often convert CAD to USD and then USD to the supplier’s local currency (like CNY or EUR), charging you twice. Loop’s Global Accounts eliminate this "double hop."
• Local Rails = Same-Day Pay: Local rails are not just cheaper; they are faster. Payments sent via SEPA or ACH often settle within 24 hours.
• 2026 Compliance: As of November 2026, the global ISO 20022 mandate requires structured data for all international payments. Modern platforms like Loop are built for this, ensuring your payments aren't rejected by updated global banking filters.

Table of Contents

1. The Math: Why Your Bank Wire is 30x More Expensive
2. Decoding the 2026 Payment Rails: SWIFT vs. Local
3. Special Focus: Paying Chinese Suppliers (CNY vs. USD)
4. The Loop Strategy: How to Automate Global AP
5. Frequently Asked Questions (FAQ)
6. Conclusion

1. The Math: Why Your Bank Wire is 30x More Expensive

Most Canadian business owners underestimate the "invisible" costs of international trade. If you are sending $50,000 USD to a supplier, a traditional bank doesn't just charge you a $50 fee; they charge you a "Spread."

The Difference: You save over $1,275 per transaction. For a brand with monthly inventory cycles, that is $15,000+ per year added directly back to your bottom line.

2. Decoding the 2026 Payment Rails: SWIFT vs. Local

In 2026, the global banking system has split into two speeds:

• The SWIFT Network (The Old Way): Your money moves through "Correspondent Banks." It is slow, expensive, and opaque. You never know exactly when it will land or how much will be deducted along the way.
• Local Rails (The Loop Way): Loop uses domestic clearing houses in 180+ countries.
  • U.S. Vendors: Sent via ACH (The same system U.S. banks use internally).
  • European Vendors: Sent via SEPA (Single Euro Payments Area).
  • U.K. Vendors: Sent via Faster Payments.

Using local rails means your supplier gets the exact amount you sent, with no surprise "landing fees" deducted by their local bank.

3. Special Focus: Paying Chinese Suppliers (CNY vs. USD)

For Canadian e-commerce brands, China is the primary destination for outgoing capital. While many factories ask for USD, the smartest 2026 strategy is to offer payment in CNY (Chinese Yuan).

Why?

1. Lower Prices: Chinese suppliers often add a 3% "Buffer" to their USD quotes. When you offer to pay in CNY, you remove their risk and can demand a lower price per unit.
2. Faster Clearing: Direct CNY transfers via Loop’s local Chinese rails often clear within hours.
3. VAT Rebates: Chinese exporters receive tax rebates more easily when paid in local currency, making you a "Preferred Buyer."

4. The Loop Strategy: How to Automate Global AP

Efficiency is as important as cost. Loop doesn't just save you money on the exchange; it saves your finance team hours of manual work.

• Multi-Currency Accounts: Open "Local" accounts in USD, EUR, and GBP. You can receive revenue in these currencies and pay suppliers out of the same balance—avoiding conversion fees entirely.
• Zero-FX Corporate Cards: For smaller vendor payments or SaaS subscriptions, the Loop Corporate Card allows you to spend in local currencies with 0% FX fees.
• Auto-Invoice Capture: Upload your supplier's PDF invoice. Loop’s AI extracts the IBAN, SWIFT, or Routing details automatically, preventing the errors that lead to bounced wires.

5. Frequently Asked Questions (FAQ)

What is the "Mid-Market Rate" and why does it matter?

The mid-market rate is the real exchange rate banks use to trade with each other. Traditional banks hide their profit by giving you a "Retail Rate" that is 2.5% to 5% worse. Loop uses the mid-market rate as the base and adds a transparent, tiny markup.

What is ISO 20022 and will it delay my payments?

ISO 20022 is the new global standard for financial messaging. As of November 2026, banks will reject payments with "unstructured" addresses. Because Loop’s architecture is modern, your payments are already compliant, unlike those from many legacy Canadian bank portals.

Is it safe to pay suppliers through Loop?

Yes. Bank on Loop partners with Tier-1 regulated banks. Your CAD funds are CDIC-protected (up to $100k) and USD operating accounts feature FDIC insurance (up to $250k).

6. Conclusion

In 2026, paying an international supplier shouldn't feel like a tax on your global growth. By shifting from traditional bank wires to a multi-currency platform like Bank on Loop, you eliminate hidden fees, speed up your supply chain, and gain a massive competitive advantage over brands still stuck in the "Big 5" banking loop.

Stop overpaying on your next invoice. Compare Loop's FX rates and send your first local payment today.