Why Banks Hold International Payments, and How Trading Companies Keep Them Moving

Why is my international payment delayed?

Picture this. A container is arriving at port and storage charges are starting to build. The supplier wants to see the money before releasing the shipping documents, and the goods can’t be collected without them.

The buyer sent the payment on Tuesday. Their bank shows it has gone. The supplier’s bank shows nothing yet.

Nobody has done anything wrong, and the money hasn’t disappeared. It’s simply sitting with one of the banks along the route, waiting for someone to look at it before it moves on.

The first thing to do is not send the payment again. That only creates a second payment to track. Instead, ask your bank for the UETR, the 36-character Unique End-to-End Transaction Reference, and ask them to trace the payment. The trace shows exactly where the payment is and since when, so your bank can find out what’s needed and both sides can see what’s happening.

How an international payment travels: correspondent banks explained

A domestic payment usually goes from one bank to another. An international payment often doesn’t.

Say an importer in Singapore pays a supplier in Germany in US dollars. That payment can’t go straight from Singapore to Frankfurt. Because it’s in dollars, it settles through the US banking system, usually via a correspondent bank in New York, and sometimes a second bank after that, before it reaches Germany.

Each of those banks is responsible for the payments passing through it, so each one runs its own standard checks. More banks in the chain means more time, more fees, and more chances that someone along the way wants a little more information before passing the payment on.

Why do banks hold international payments?

Usually it just means a bank wants to understand the payment a bit better before sending it on. In our experience, it almost always comes down to one of three things.

1. The payment reference isn’t clear

The payment reference is the bank’s main clue about what a payment is for. Finance teams often fill it with internal shorthand, like INV 4412 / PARTS / SHP. That makes sense to your team, but to a bank on the other side of the world, it means nothing. When a bank can’t tell what a payment is for, someone has to look at it manually, and that takes time. A clear reference, with the invoice number, the PO number and a plain description of the goods, answers the question before anyone needs to ask it.

2. The name doesn’t match

Banks check that the name on a payment matches the name on the receiving account. The UK has Confirmation of Payee, and since October 2025 the EU has required Verification of Payee on euro transfers. If you pay “Pacific Trading Ltd” when the account is registered to “Pacific Holdings Ltd”, or you use a brand name instead of the legal company name, the receiving bank may hold the payment or send it back until the details are confirmed. It’s a simple fix, and one of the most common causes of delay.

3. There are a lot of banks in the chain

Every extra bank is another review with its own process and its own timing. A payment can go through your own bank smoothly and still need a question answered further along the route. That isn’t a problem with your payment. It’s just how correspondent banking works.

How to make international payments faster: pay locally

If you pay suppliers regularly in the same currencies, it’s worth looking at how those payments are routed. The most efficient setup is paying suppliers in their own currency, from an account in that currency that settles locally.

A US dollar account doesn’t solve the Singapore-to-Germany example. Dollars sent to Frankfurt are still an international payment through New York. But pay that German supplier in euros, from a euro account that settles in Europe, and the payment goes directly from bank to bank:

• Euros (EUR): a European account with its own IBAN, settling over SEPA and T2. Standard SEPA arrives the next business day; SEPA Instant arrives in seconds.
• US dollars (USD): an account at a US-regulated institution with domestic routing numbers for ACH and Fedwire.
• British pounds (GBP): a UK account settling locally through Faster Payments and CHAPS.

Your bank and your supplier’s bank still review every payment, as they should. The difference is that the payment travels a shorter route, which usually means it’s faster, cheaper, and easier to track.

Worth knowing: some “local currency accounts” are pooled accounts that still route through correspondent banks behind the scenes. If you’re paying suppliers regularly and in volume, a dedicated account in your company’s name that genuinely settles locally is usually the better setup.

Share the full picture with your bank early

When businesses ask us about a delayed payment, the pattern is usually the same: the supporting documents were only pulled together after the bank asked for them. Answering a question after the fact typically takes three to five business days of back and forth.

The businesses whose payments run smoothly treat this as part of sending the payment. For a large payment, or the first payment to a new supplier, they send their relationship manager the supporting documents 24 to 48 hours in advance:

• The signed contract or purchase order
• The countersigned proforma or commercial invoice
• The bill of lading or sea waybill, if it’s already been issued
• A clear payment reference, for example: COMMERCIAL INVOICE #2026-881 / COMMERCIAL TEXTILES / PO #4420

Another bank along the route may still ask its own questions, because it doesn’t see what you gave your bank. But when it does, your relationship manager already has everything to hand and can answer the same day.

Good habits for international business payments

1. Use the exact legal name. Match the name on the payment to the company registry and the receiving bank account, not a trading name.
2. Write a clear reference. Invoice number, PO number and a plain description of the goods. Leave out internal codes and abbreviations.
3. Pay locally where it makes sense. For regular EUR, USD or GBP supplier payments, local accounts are usually faster, cheaper and easier to track.
4. Keep the UETR. Save the tracking reference for every large payment, so your bank can trace it straight away if you need an update.
5. Share documents early. Give your relationship manager invoices and shipping documents in advance for large payments and new suppliers.

What I’d actually do

At the end of the day, banks aren’t trying to slow your business down. They’re just doing their job, inside a system that’s been built up layer by layer over decades. Once you see it that way, a delayed payment stops being a mystery.

Understand how your payments travel, give the banks clear and complete information, and set up your accounts so your regular payments take the most direct route. A payment that’s easy to understand is a payment that gets processed quickly.

Frequently asked questions

How long does an international payment take?

Most international bank transfers arrive in one to three business days. Payments that pass through several correspondent banks, or that need an extra review along the way, can take longer. Local payments, such as SEPA in Europe or Faster Payments in the UK, are usually same day or next day.

What is a correspondent bank?

A correspondent bank is a bank that processes payments on behalf of another bank, usually in a currency or country where the first bank doesn’t operate directly. Most US dollar payments between two non-US banks pass through at least one correspondent bank in the US.

What is a UETR?

The UETR (Unique End-to-End Transaction Reference) is a 36-character tracking number attached to SWIFT payments. Your bank can use it to see exactly where a payment is along its route.

Should I resend a payment that hasn’t arrived?

No. Ask your bank to trace the original payment first. Sending it again creates a second payment to track and can make things more complicated.

How can a business make international payments faster?

Use the exact legal name of the recipient, write a clear payment reference, share supporting documents with your bank early for large payments, and, for regular supplier payments, pay in the supplier’s currency from a local account.

This article is general information, not legal, financial or regulatory advice. Payment rules and settlement times vary by country and institution. Views in the “My take” and opinion sections are the author’s own.