The first time I paid a supplier in India for Kind Loom bedding, my bank quoted me a small wire fee and I thought that was the cost. It wasn’t. The real cost was buried in the exchange rate, and I only spotted it when I compared the CAD that left my account to what my supplier actually received. That gap taught me more about international payments than any blog post, so let me save you the tuition.

The hidden cost nobody points at

Wire fees are the distraction. The real money is in the exchange rate. Most banks give you a rate that’s quietly marked up 2 to 4 percent off the true mid-market rate, the one you see on Google. On a $5,000 payment, a 3 percent markup is $150 vanishing on top of the flat fee, every single time. Multiply that by every reorder and it’s a serious line on your P&L. Whenever you compare options, ignore the advertised fee and ask what exchange rate you’re actually getting.

Traditional bank wire

Your Canadian bank can absolutely send an international wire, and for some suppliers it’s the only method they trust. The downsides are the ones above: a flat fee (often $30 to $50), a marked-up exchange rate, and sometimes intermediary bank fees that shave a bit more off before your supplier sees it.

• Good for: suppliers who insist on bank-to-bank, and very large or sensitive payments.
• Watch for: the FX markup and intermediary deductions.

Wise (my pick for regular payments)

For the bulk of my supplier payments I use Wise. It gives you the real mid-market exchange rate and shows the fee upfront as a separate, visible line, so there’s no guessing what the true cost is. That transparency is the whole reason I switched. On a typical order I’ve watched it come out meaningfully cheaper than my bank’s wire once the hidden FX markup was accounted for.

• Good for: recurring supplier payments where FX markup adds up.
• Watch for: confirming your supplier accepts a Wise transfer, though most now do.

I wrote a longer Wise review for Canadian businesses with actual numbers if you want to see how it compares.

PayPal

PayPal is convenient and familiar, and for a small first sample order it’s fine. The trouble is scale. For larger sums the exchange rate is typically worse than Wise, and cross-border fees add up quickly. I’ve used it for a $200 sample without losing sleep, but I wouldn’t send a full inventory payment through it.

• Good for: small samples, quick one-offs, suppliers you’re still vetting.
• Watch for: poor rates and fees on large transfers.

Letters of credit

A letter of credit is a bank instrument that guarantees your supplier gets paid once they meet agreed conditions, like shipping documents. It’s the heavyweight option, used for large orders with new suppliers where both sides need protection. It’s slower and involves bank paperwork and fees, so it’s overkill for a few thousand dollars, but genuinely useful once orders get into serious five figures.

• Good for: large orders, new relationships, high-trust-required deals.
• Watch for: complexity and cost that only make sense at volume.

Protecting your payment

How you pay matters as much as what you pay with. A few habits that have saved me:

• Split the payment. A common structure is a deposit up front (say 30 percent) and the balance before shipping or against shipping documents. Never wire 100 percent before anything is made.
• Match the name. Pay a business account whose name matches the company you’re actually dealing with. If a supplier asks you to send money to a personal account or a different name, stop and ask why. That’s a classic warning sign.
• Keep it traceable. Use a method that gives you a clear paper trail, which every option above does better than cash or crypto.

The business account that matches your name

One quiet problem for new founders is paying suppliers from a personal account, which muddies your books and looks unprofessional to a supplier checking who they’re dealing with. I run payments through a proper business account with Venn, which keeps my business banking clean and multi-currency friendly. My Venn review goes into how I use it day to day.

Record-keeping for customs and taxes

Every supplier payment is a document you’ll want later. When your goods hit the border, the CBSA cares about the declared value, and your payment records back it up. Keep the invoice, the proof of what you paid, and the exchange rate applied, because you’ll need the CAD value for both customs and your books. The CBSA’s importing guidance is on cbsa-asfc.gc.ca, and the CRA expects you to keep these records on canada.ca. Wise and Venn both make it easy to export clean statements at tax time, which my accountant genuinely thanks me for.

My honest bottom line

For most small Canadian importers, Wise for regular payments and a real business account behind it will save you real money versus a plain bank wire, mostly by killing the hidden FX markup. Reserve wires and letters of credit for the big or high-stakes stuff. And whatever you choose, always compare the exchange rate, not the advertised fee.

This is based on my own experience — not financial, tax, or legal advice. Rules, rates, and fees change, so confirm current details with official sources like the CRA and CBSA before you decide.