What is a Remittance Address?

Before setting up a business, you must calculate your cost, profit, and other factors that can directly affect your enterprise. One of the major factors that can affect the financial aspect of your business is your method of receiving payments. Usually, business owners need an address where they can send and receive payments. This is how a remittance address becomes a necessity. Now, you may be wondering what is a remittance address? Read on to learn about what this means and why it is relevant for businesses.

What is a remittance address?

A remittance address, also known as a remit address is a destination for clients to send cheques and invoices. Basically, it is a way for both individuals and businesses to collect payments. It works similarly to a regular address, however, it is just for monetary transfers.

As a business, you need to have a remittance address if you want to receive payments conveniently. You can use any type of address for this purpose. While some people prefer to use their house address, others use another address or even a PO Box.

Also, you can use your bank address as your remittance address. Some businesses that don't want to go through too much stress just direct their payments to the bank for processing, rather than an actual office.

Across the world, companies use remit addresses to process and send money internationally. Other terminologies associated with remittance addresses are:

1. Remit To: This is notifying a client where to send a payment.

2. Remit Address: Companies use this term to ask where to send payments.

3. Billing Address: This is the address associated with the payment’s destination.

What Does a Remittance Address Look Like?

A remittance address looks like any other typical address. Usually, it is labelled with this prefix, “Remit to:” The label is then followed by the remit address, which is the destination of the payment.

Sometimes, the remit address can be an international one. However, it should still look like a normal mailing address in the receiver’s country.  

Remember, the remit address of a business is entirely different from its corporate address, so you must not mix them up. You don't send payments to a business corporate address, except if they direct you to do so.

The first thing to look out for is the “remit to:” address that will be recorded on your invoice. That's how to spot the remit address of any business.

For instance, let's see the difference between the remit address and the corporate address of Microsoft:

Corporate Address

Microsoft Corporate Headquarters,

One Microsoft Way,

Redmond,

Washington,

98052-6399.

Remittance Address

901 Main St.,

7th Floor Dallas,

TX 75202 ·

As you can see above, there are two separate addresses for corporate operations and remittance. So if you want to make a purchase, you should send it to the remittance address in Dallas. Do this instead of sending it to their corporate address in Washington.

Why do businesses use a remittance address?

If you own a business or plan to own one, it is important to create a remit address if you want to grow rapidly.

Basically, it is a great method which businesses can use to process their payments and organize their finances. Moreover, it is important to help keep track of important invoices. Generally, businesses receive so many invoices every day. Having a remit address will help to organise this process and keep a record of important invoices. Here are some other benefits of creating a remittance address for your payments and invoices:

• Processing payments quicker
• Making payments quicker when your business receives invoices from clients.
• Keeping a track of all payments and invoices and ensuring that none of them gets lost during the delivery to different departments

How to verify that a remittance address is legitimate

As a business owner, you need to be able to differentiate between a real remit address and a fraudulent one. Run a background check on a remit address before you send or receive a payment. Also, if any address looks suspicious, it is best you research it.

Usually, billing departments list their contact or phone number on payments, receipts, and invoices. So to check that an address is real, call the number listed and speak to a representative to verify a claim. If you don't see any number, research the company online to find its main contact or email address. You can reach out to them for verification via any of these means. This is a good way to verify that the company’s remit address is legit.

How can I make international transfers using your remittance address?

If you are making any international financial transaction, you need to understand how remit addresses operate if you want to receive your money on time. There are numerous ways to remit your payment. Some of these ways include:

1. Bank transfer

Bank transfers are one of the most common methods of making international transfers via a remittance address. Basically, people prefer this method because it can be executed quickly and without any charge.

Depending on the bank, the steps to execute an international payment via bank transfer will vary. However, here is a sample of what to expect:

• Log in to your existing account.
• Next, look for the “International Transfers” tab.
• Prepare the routing numbers and/or the SWIFT codes. These are important for both you and the recipient.

Always make sure to reach out to billing departments or any accounting professional to validate that an address is accurate.

2. EFT, also called electronic funds transfer

An electronic funds transfer is a trusted means people use to send money. You can use the services of any legit Electronic funds transfer provider to help you remit a payment successfully. If you are confused about how to go about it, reach out to their customer service for help.

Here are a few things to do before making any remittance payment internationally:

• Research first, then register. Ensure that you trust the EFT service provider before you arrange a transfer.
• Have your ID readily available to verify your identity and complete transactions.
• Supply account details.

3. Cheques and money orders

Another good way you can execute international transfers to any remittance address is through cheques and money orders. You can simply write a cheque for it or send a money order. However, there are advantages and disadvantages to using this method. The advantage of using this method is that it provides a substantial record of your transfer. On the other hand, the disadvantage is that processing cheques take longer. So if you supplied incorrect information, your cheque can get bounced, thereby delaying the money from reaching its destination.

Bottom Line

At this point, you should already have an answer to your first question, “What is a remittance address?” Essentially, it is an address where businesses receive payments. While there are so many advantages of creating a remit address for your business, its major goal is to help organise your family finances, manage bills effectively, and safeguard your home address.

Digital remittance simplifies the tedious manual process of sorting address remittances. Essentially, it helps businesses save on time, labour resources and cost. SanaTransfer offers easy, fast and secure payment services with better rates and faster payouts for international remittance. Sign up now to get started.