Getting paid across the Tasman without a cash flow wobble

Winning a customer on the other side of the Tasman feels great. Getting paid by them can feel a bit less great. The invoice takes longer to arrive, longer to be approved, and when the money finally lands it may be worth a little more or a little less than you expected, because the two currencies never sit still. Mr’s guide to keeping cross-border cash flow calm.

What makes cross-border payments different?

Three things, mostly:

1. Time. New customers abroad often pay on longer cycles, and transfers between countries can add a day or two.
2. Exchange rates. Unless you and your customer use the same currency for the invoice, someone carries the movement in the rate between issue and payment.
3. Distance. You can’t pop round with a coffee to chase a late payment. Relationships and terms carry more weight.

None of these is a reason not to trade across the Tasman. They’re just reasons to plan.

Which currency should you invoice in?

This is the decision that shapes everything else.

Option	Who carries the exchange rate risk	Upside	Downside
Invoice in your own currency	Your customer	You know exactly what you’ll receive	Some customers resist, or pay slower
Invoice in your customer’s currency	You	Easier to win and keep customers	Your income moves with the rate
Mix by customer	Depends	Flexible	More admin, more to track

Both the Reserve Bank of Australia and the Reserve Bank of New Zealand publish daily exchange rates. If you invoice in your customer’s currency, check the rate regularly and build a small buffer into your pricing for movements. For bigger, regular volumes, talk to your bank about tools for managing currency risk. That’s a specialist area and worth proper advice.

How do you get paid faster?

business.gov.au’s payment terms guidance applies just as well across the water:

• Set clear terms on every quote, contract and invoice: how, when and in what currency.
• Check new customers before offering credit, and set limits.
• Keep ownership of goods until they’re paid for, where your contracts allow.
• Chase politely, then firmly. A friendly reminder at day one overdue, a firmer one at day seven, and a formal letter if needed.

Mr adds a few trans-Tasman extras:

• Take deposits on large or custom orders, especially from customers you haven’t dealt with before.
• Open a local bank account in the other country, so customers pay locally and you move money across in bigger, less frequent transfers.
• Make invoices easy to approve. Correct business numbers (ABN or NZBN), GST treatment shown clearly, and purchase order numbers if the customer uses them.

Waiting on overseas customers while your own bills fall due? Mr’s people look at working capital funding case by case, and asking won’t touch your credit file. Choose your country and start a 60-second enquiry.

How do slow payers and exchange swings hit cash flow?

Illustrative only. A Hobart seafood processor sells to an Auckland distributor on 45-day terms, invoicing in the customer’s currency. One month the distributor pays 30 days late, and the exchange rate moves against the processor in that time. The processor gets its money 75 days after the catch was bought, and slightly less of it than planned. Meanwhile, boat crews, freight and GST on local costs have all been paid.

That’s the cross-border squeeze in one example: a perfectly profitable sale that strains cash flow because of timing and the exchange rate. The fixes are the ones above, plus a cash buffer or a facility sized to cover the gap.

How do lenders view revenue from the other country?

On both sides, lenders like revenue that is:

• Steady. Regular orders from established customers, not one huge invoice.
• Documented. Contracts, invoices and remittances that match the bank statements.
• Collected. Money actually landing in your account, not just sitting in receivables.
• Diversified. One overseas customer making up most of your revenue is a concentration risk wherever they are.

Unsecured and cash-flow funding, usually between $5,000 and $500,000, is worked out from turnover and bank statements, so clean records of cross-border receipts help directly. Property-secured options, between $20,000 and $5,000,000, can bridge bigger timing gaps, such as funding stock for a large export order. The Australian site explains covering cash flow while customers pay late, and the New Zealand site covers seasonal and uneven income.

Does a local bank account help?

Often, yes. When customers in the other country can pay into a local account, payments arrive faster and look familiar to their accounts team. You then move money across the Tasman in larger, planned transfers. It also gives you cleaner records for each country’s GST and income tax, and clearer bank statements for lenders on each side.

Your cross-border payments checklist

• Decide the invoice currency for each customer, and write it into contracts.
• Track the exchange rate on outstanding invoices.
• Take deposits on large orders.
• Open a local account in the other country if volumes justify it.
• Keep remittance advice for every overseas payment.
• Review overseas debtors weekly, not monthly.

Keep the cash moving

Overseas customers can be the best customers you have, as long as your cash holds up while you wait for them. If you need that buffer, start with a quick enquiry: it doesn’t involve a credit check, it isn’t parcelled out to lenders, and a real person in your country reads it. Be accurate about turnover and how much arrives from across the water, and you’ll get an answer that fits. Choose Australia or New Zealand.