How do Cross Border Payments Work?

 

As the name indicates, cross-border payments are transactions between payers and recipients based in separate countries. According to Alan Safahi, an experienced entrepreneur and founder of a San Francisco-based startup company, cross-border payments usually cover retail and wholesale payments, including remittances.

Credit card payments, bank transfers, and alternate payment methods are common ways to make cross-border payments. Thanks to advanced technology, the business world has a global reach, meaning remittances, purchases, and payments require money exchanged across countries. Read on!

Cross-Border Payment Market Overview

According to Alan Safahi Orinda, cross-border payments are a $22 trillion market. Safahi says the market is snowballing, and 80% of these payments are B2B-related, with banks dominated over 95% of the cross-border payment market. However, it is often challenging for banks to maintain their 95% share of the market.

Alan Safahi’s research shows that banks have not made substantial efforts to improve their back-end systems and operations involved in cross-border payments. Consequently, such payments often remain costly for customers. Safahi argues that customers face various pain points, including:

• Lack of transparency
• Inadequate tracking methods
• Slow processing times

On the other hand, non-bank players make substantial efforts to encroach on the conventional cross-border turf of banks, shifting from C2B to B2B cross-border payments. Non-bank players are forcing banks to reconsider their long-standing strategies and methods for cross-border payments.

Types of Cross-Border Payments

Bank transfers, credit cards, and alternative payment models (APMs) are common types of cross-border payments. According to Safahi, consumers or customers choose payment methods that are reliable and convenient for them. Let us talk about these types. Continue reading!

Bank Transfers

International bank transfers are a common channel for making cross-border payments. However, larger banks in the U.S have a limited range of stocked currencies, making it challenging for customers to place cross-border payments.

For instance, when a customer in the U.S wants to transfer money to another country, the bank relies on a foreign banking partner to streamline the transaction process. Likewise, smaller banks usually don’t hold foreign currencies, and they rely on larger banks to make cross-border payments on their behalf.

Credit Cards

Alan Safahi is an experienced entrepreneur who has thorough and up-to-date knowledge of cross-border payments. Safahi says that credit cards play a crucial role in cross-border transactions. Safahi recommends credit cards as a go-to option for consumers.

Cross-border payments via credit cards are relatively straightforward and quick. All you need is to enter your card details and wait for the transaction verification. Because banks make efforts to optimize the currency conversion process, you have to specific fees.

Alternative Payments

There are numerous alternative payment options for cross-border payments. However, the most common one used today is a digital wallet, also known as an e-wallet. It is a software-based electronic alternative payment model that allows consumers to pay for in-store or online transactions.

E-wallets enable customers to store their payment cards safely and make transactions through software and apps. The most popular and common e-wallet payment options are PayPal, Google Pay, Apple Pay, and Ali-Pay.

Final Words

According to Alan Safahi Orinda, the biggest advantage of making a cross-border payment is reliability and convenience, primarily when you use a global payment platform. Safahi recommends banks and private companies implement a solid onboarding process with a sophisticated online portal to make it easy for payees and recipients to place cross-border payments and update their information as necessary.

Originally Posted:-https://timebusinessnews.com/how-do-cross-border-payments-work/

Top 7 Reasons Stock Traders Lose Money

 Stock trading requires careful planning and preparation. Otherwise, you will lose money. Most stock traders, especially beginners, feel disappointed when their purchase value decreases. According to Alan Safahi, if you don’t know why the value has dropped, you will make less informed decisions. Thus, it can lead to losing more money. Read on!

1.     Lack of Research is one of the most important aspects of stock trading, allowing you to understand the stock market and make informed decisions. However, most people follow advice and recommendations on the internet without doing thorough research. Safahi says lack of research can lead to significant losses. Therefore, it is wise to keep yourself up-to-date by performing thorough research and analyze the stock market.

2.     Lack of Patience Stock traders who want to become wealthy quickly often lack consistency. If you avoid keeping yourself on track and try to emulate people who show off money, lavish traveling, and fancy cars, you will lose money. According to Safahi, avoid getting rich quickly and focus on long-term profitability. Therefore, be patient, do your research, and make informed decisions to stay on track.

3.     No Diversification According to Alan Safahi, it is crucial to diversify your assets to make more money in the stock market. Even if you are a beginner, you need to focus on reading information about diversification. When you create a diversified investment portfolio, you can overcome problems like rough economies or market corrections.

4.     Emotional Decisions Alan Safahi Orinda advises stock traders to keep their emotions out of business. When you make an emotional decision and fail to focus on analyzing the market conditions, you will lose a significant amount of money. Safahi says emotions can harm your decision-making ability, leading to irreversible mistakes.

5.     Over Complicated Investments Although it is wise to diversify your assets and build a multi-dimensional portfolio, owning too many funds and finding random ways to make profits will complicate your investment strategy. Consequently, you will tamper with your portfolio and lose money. Therefore, it is wise to maintain a simple investment portfolio.

6.     Ignoring Fees Investing without knowing the fees that come with purchasing funds or making stock trades can prevent you from having increased ROIs. Sometimes, you pay the fees, buy the stocks, and feel that you have done the right thing. However, it can harm your profitability over time and prohibit you from making money.
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7.     No Record Maintenance According to Alan Safahi Orinda, data is one of the most critical elements in stock trading. When you don’t analyze data or information, you will have no control over the market conditions. Therefore, you must focus on record keeping to achieve your goal.

Final Words Stock trading offers a wide range of benefits, allowing you to take advantage of the growing economy. Safahi says an increasing economy is directly proportional to corporate earnings. However, if you make the mistakes given above, you will feel disappointed and lose money. 

Originally Posted:- https://alansafahi.weebly.com/blog/top-7-reasons-stock-traders-lose-money

What are Payment Challenges in the Gig Economy?

The gig economy refers to the collection of markets that focus on a gig or job to match providers to consumers. The basic model involves gig workers entering into formal agreements with on-demand commerce or companies to provide products or services to the company’s clients.

Alan Safahi, an experienced entrepreneur and founder of a San-Francisco-based startup company, says that the gig economy will become a mainstay worldwide, especially during the Covid-19 pandemic.

Alan Safahi Orinda has done substantial research on the proliferation of on-demand products and services. The leading entrepreneur says that sharing economy will change the way people live, work, and spend money. Safahi’s research shows that freelancers will make up 50% of the U.S workforce within one decade.

Although freelancing and the gig economy offer various benefits, this type of niche or work involves trade-offs. While people work on-demand and multiple jobs with independence and flexibility, they experience volatility in payments. Read on!

Lack of Access to Payment Methods

According to Alan Safahi, most people who use cross-border payments in the gig economy face numerous challenges. Lack of access to payment methods is the biggest challenge faced by gig economy workers. For instance, funds transfers through global payment processors, Fintechs, remittance companies, and banks do not favor freelancers and gig economy workers.

For instance, PayPal is the most popular platform for gig economy workers in most countries. However, the company does not offer services in over 80 countries worldwide, making it challenging for people to pay and receive funds.

Payment and Transparency Issues

According to Safahi, about 75% of gig-economy workers would stop selling their products and services and leave the industry if the authorities fail to resolve the current payment issues. Gig economy workers and freelancers look for better and advanced communication and business support services, especially when there are problems with payments and delays.

Gig economy workers likewise crave greater transparency and streamlined accuracy with payments. Safahi says that the biggest challenge for such workers is not having a solid platform to monitor their financial transactions. However, the good news is that some banks in the U.S offer a feature like cash-bank and multiple currencies wallet to millennials.

Excessive Delays and Fees

High fees and commissions are some of the biggest challenges faced by gig economy workers when receiving payments. For instance, lack of transparency in charges, slow settlement speed, and fluctuating foreign exchange rates are a massive frustration for freelancers or gig economy workers.

Safahi says that online marketplaces have segmented their payment models into B2C and C2B strategies. The time lag is usually caused by intense banking regulations, automated clearing house (ACH) transfers, and foreign exchange rates.

Final Words

Alan Safahi Orinda argues that pre-Covid-19 and post-Covid-19 regulations remain the same for gig economy workers. Like other businesses, gig workers worldwide have been highly affected by the crisis brought by the pandemic. Safahi suggests banks, private companies, and payment processing platforms review their strategies and streamline payment processes for gig workers and freelancers.

Originally Posted: https://safahi.com/what-are-payment-challenges-in-the-gig-economy-ad9beabd3dbf

Why is FX Liquidity Important in Forex Trading?

The foreign exchange market is the backbone of global trade and international investments. According to Alan Safahi, an experienced entrepreneur and a leading startup founder in San Francisco, individuals, and businesses must understand the significance of FX liquidity for three reasons:

· The average trading volume daily is $5.4 trillion, making foreign exchange the world’s second-largest market.

· Forex trading plays a substantial role in guaranteeing efficiency and no-arbitraging conditions in stocks, bonds, and derivatives.

· Forex trading has an over-the-counter (OTC) nature characterized by market heterogeneity, and fragmentation, causing unprecedented liquidity patterns.

Importance of Liquidity to Forex Traders

According to Alan Safahi Orinda, the forex market is a decentralized international market and has no physical location because currencies’ selling and buying occurs electronically, mainly between banks. However, other participants, such as pension funds, hedge funds, investments, insurance companies, and corporations, also play crucial roles in forex trading.

Safahi says that most forex traders do not understand the concept of FX liquidity. It is crucial to comprehend this concept to streamline your trading operations. The successful entrepreneur and an expert in forex trading “Alan Safahi” says that liquidity refers to the current demand for a product or service.

In financial markets, liquidity refers to the quick conversion of a specific device into cash, physically or electronically. For instance, short-term U.S bonds and gold are a few instruments with higher liquidity rates. Traders buy and sell these instruments throughout the world rapidly after reaching an agreement at a reasonable price.

Volume Option

According to Safahi, brokers often offer a volume option, allowing the trader to measure the liquidity amount on the market. The volume option is determined by analyzing different bars on the volume charter. Bear in mind that each volume bar represents the traded amount, giving traders the volume liquidity’s approximate values.

High and Low Liquidity

Alan Safahi recommends focusing on high liquidity in the forex market. It refers to a currency pair that you can buy and sell in significant sizes without significant variances in the exchange rates or price levels. According to Safahi, traders must focus on major currency pairs, such as:

· EUR and USD

· USD and GBP

· AUD and USD

· USD and CHF

· USD and NZD

· EUR and GBP

· JPY and USD

On the other hand, low liquidity in the foreign exchange market refers to a currency pair that you can’t purchase or sell in significant sizes. Alan Safahi gives an example of exotic currency pair, the PLN, and JPY.

Look for Signs

Alan Safahi recommends looking for various signs to determine the market liquidity. The first one is figuring out gaps when trading forex because they vary compared to other markets. Bear in mind that price gaps occur in the foreign exchange market if high-impact news or interest rate announcements are against expectations.

Another thing you need to consider is the volume option offered by brokers on the chart. Using the chart, you can measure the market liquidity and interpret the FX liquidity by analyzing different bars on the volume chart.

Moreover, if you are a short-term trader or scalper, make sure you are well-aware of varying liquidity through the trading day. Bear in mind that the US session and London session are major moving market sessions highly prone to large percentiles moves and breakouts on the day.

Final Words

Liquidity is a foreign exchange market that refers to how fast traders can convert their investments into cash. Safahi recommends understating the concept of liquidity and learning ways to measure and analyze FX liquidity to get the most out of your trading.

Originally Posted: https://safahi.com/why-is-fx-liquidity-important-in-forex-trading-bd4723a89232

An Essential Guide to Freelance Payment Methods

Alan Safahi, a leading San Francisco-based entrepreneur and startup founder has made substantial research on freelance payment methods. According to Alan Safahi Orinda, freelancers represent over 35% of the workforce worldwide, and there are over 1.1 billion freelancers of the total 3.5 billion people in the global workforce.

Safahi’s research and analysis show that freelancers contribute more than $1 trillion to the U.S economy and about 5-7% of the total gross-domestic-product (GDP). About 48% of freelancers charge a fixed rate when selling their products or services, while 29% follow an hourly approach, and 23% experience use both methods.

There are numerous ways to receive money, and each method has its own advantages and disadvantages. Freelancers don’t always choose because most companies hire people with their preferred funds’ transfer methods implemented. However, many companies ask freelancers about their preferred payment methods. Therefore, it is crucial to choose wisely to maintain your cash flow. Read on!

Checks

Although many freelancers have forgotten the old-fashioned paper checks in this digital age, some companies hire freelancers to pay by check routinely. According to Alan Safahi, some freelancers prefer checks to other payment methods.

The biggest advantage of checks is that it doesn’t cost you money to receive them. However, the downside of checks are that you will have to wait a few days for your check to arrive if you have a local client.

Direct Deposit

Some freelancers prefer receiving payments by direct deposit method. A direct transfer occurs between the client and the freelancer’s bank. Alan Safahi says if a client offers this option, you should take it because it is brainless on your end.

For instance, you offer your products or service, get the job done, and the money appears in your bank account. However, the only downside with direct deposit is that your client has to initiate the process through his own bank.

PayPal

PayPal is the gold standard for many entrepreneurs to accept payments. It is one of the most popular payment processing platforms, allowing freelancers to accept different debit and credit cards online. Likewise, your clients can pay you from their bank accounts directly.

According to Alan Safahi Orinda, PayPal is an easy and effective method for freelancers and their clients. Because the platform is widely recognized and used, clients usually don’t balk at using it. Similarly, it enables you to receive payment instantly.

The downside of PayPal is that it charges a 2.9% transaction fee and $.30 per sale. Although this is a small free, it adds up to substantial amounts over time. For example, if you earn $3,000 per month and receive payments through PayPal, you will pay around $900 over a year.  

Merchant Accounts

A merchant account is a unique bank account that enables a freelancer to accept money from their clients’ debit or credit cards directly. Most clients find it convenient to pay funds from credit cards because merchant accounts have lower transaction fees than payment platforms like PayPal and Payoneer.

Merchant accounts likewise enable freelancers to set up recurring payments and offer business support. The downside of a merchant account is that it will charge a portion of each transaction.

Final Words

There are numerous ways to pocket your profits from selling your services and skills through freelance platforms. However, there is no single perfect product or solution for you, meaning you need to choose the one that best fits your needs.

Originally Posted: https://alansafahi.com/guide-freelance-payment-methods/

How Manage Foreign Exchange Risk

During the Covid-19 pandemic, the foreign exchange market has seen dramatic fluctuations, including changes in currency rates. The global economy has almost ceased due to strict regulations regarding lockdowns and contain the outbreak. The pandemic has affected the stock market and oil prices, putting brakes on the global economy.

According to Alan Safahi, a San Francisco-based startup founder and entrepreneur, the forex market seeks safe-havens, and traders move toward the U.S. Dollar, Swiss Franc, and Japanese Yen. Safahi’s research and analysis show that commodity and smaller currencies have also suffered during the pandemic.

These currencies include the New Zealand Dollar, Australian Dollar, Swedish Krona, and Norwegian krone. In today’s article, we will guide you on how to manage foreign exchange risk. Make sure you read this guide thoroughly to get the most out of it. Read on!

Do Some Background Research

Alan Safahi of Orinda suggests traders do some background research on currency volatility to source the right supplier or search for overseas property. Because foreign exchange is a complex market, it is crucial to consult a specialist or expert who can guide you on the risk mitigation strategies and explain how to stay stable in the market.

Invoice and Contract in U.S Dollars

Individuals and businesses use different protection strategies against fluctuations in exchange rates. Invoicing and contracting in U.S dollars is the easiest strategy to keep your expenses, revenues, and profits in the same currency.

Traders who are active in their home currencies will have no transaction and translation risk because these risks are passed to their overseas business partners. However, some overseas business partners may charge you for them to take over the risks.

Use a Foreign Currency Bank Account

According to Safahi, Founder at Zed Network, a payment orchestration platform focused on cross border payments and FX, “matching” is another effective option to mitigate or manage risks in foreign exchange. For instance, you need to open a foreign currency account and match your sales receipts from foreign customers with payments due to foreign suppliers with the same currency.

Make sure you deposit the receipt in the bank account and then use your balance to pay the supplier. It is an effective strategy because it reduces your currency exposure to your balance left in the account, especially after meeting the foreign-currency liabilities.

Use Hedging Methods

Safahi, a global entrepreneur with thorough knowledge of hedging methods for foreign exchange risk management, suggests that, if several months are likely to pass between your contract signing and payment in a foreign currency, it is better to hedge it through a forward exchange contract.

Bear in mind that such contracts are typically the “purchase now and pay later” deal, allowing you to lock in exchange rates at a determined date in the future. According to Alan Safahi of Orinda, the set date is usually anywhere between 6-24 months.

A forward contract is an excellent way to manage foreign exchange risk because one party buys and another sells currency on a set date in the future at a predetermined exchange rate. You can make contracts with a bank or currency provider through Zed to minimize risks.

Final Words

Foreign exchange risks involve fluctuations in currency exchange rates, affecting a company’s financial performance. Remember, these changes in currency exchange rates can significantly damage your business profits by consuming into margins. If you want to manage foreign exchange risks, follow the tips and tricks given above. These guidelines are based on Alan Safahi’s years of experience and up-to-date knowledge of the market.

Originally Posted: https://vocal.media/trader/how-to-manage-foreign-exchange-risk-an-essential-guide

How Does Foreign Exchange Trading Work?

According to Alan Safahi, a leading San Francisco startup founder, advisor, and entrepreneur, foreign exchange trading, also known as forex trading, is a global marketplace that focuses on exchanging currencies against one another and involves the relative value of one specific currency over another.

Research conducted by Alan Safahi of Orinda, CA highlights that forex markets are the largest and most liquid asset markets worldwide due to streamlined trading, commerce, and finance. The foreign exchange market has a colossal amount of liquidity, enabling people to actively trade trillions of dollars every trading day. In today’s article, we will discuss how foreign exchange or forex trading works? Read on!

Currency Value Measurement

A currency value is analyzed and measured through the amount of another currency it can purchase. The process is known as the price quote, which contains two prices: a bid and asks. People use the “ask price” when buying a currency. Likewise, traders use the bid price when selling currencies.

Bear in mind that a financial instrument’s ask price is usually higher than the bid price, meaning a bank purchases your currency at slightly lower prices. In contrast, the bank will sell it at a higher rate. Safahi advises traders to learn the basic and advanced concepts of a bid and ask price to measure currency value.

Liquidity Analysis

According to Safahi, liquidity refers to the activity levels of the market. Traders determine liquidity by analyzing the number of traders who are actively trading and measuring their total volume.

Because forex trading occurs 24/7, it is the most liquid market in the world. More liquidity means tighter spread, which favors everyone. Because trading is ongoing, traders can conduct it smoothly with plentiful liquidity. However, Safahi advises traders to keep an eye on price gaps to evaluate significant price shifts over the shortest periods.

Placing a Buy Order

Traders must focus on forex mechanics. You can trade at the click of a mouse on any trading platform. For instance, you will place a buy order on the USD/EUR currency pair and use a portion of funds from your account to buy the pair’s base currency. For example, you will buy the USD and sell the pair’s quoted currency, the EUR.

You will place the order with the broker, market maker or communicate with the Forex Interbank Market directly. Remember, the interbank market has big players. Safahi states that you can place orders to sell currencies that you don’t own.

Close the Order

Depending on your trading strategies, you will wait until your purchased currency has increased value relative to the sold one. When you are satisfied with the accumulated profit, you will close the order.

Likewise, the broker will perform the opposite transactions – selling dollars and purchasing euros. Bear in mind that you can also place a sell order to reverse the process. Understanding these concepts is essential for beginners to streamline their trading.

Final Words

It is often confusing for beginners to understand the concepts of buying and selling in foreign exchange markets because, in every trade, traders exchange one currency for another. It means there is always a “buy” and “sell” in every trading process.

Originally Posted: https://alansafahi.com/how-does-foreign-exchange-trading-work/