Are you looking for a safer and more reliable method to pay your Chinese suppliers? It is not easy to make your first massive payment with no concerns. Many scams are going on in the market, and we are here to save you from all those scams by telling you the right methods that lessen any risk related to your payments.

There are various methods to send your payments to Chinese suppliers, and here are five frequently used methods.

  • T/T (Telegraphic Transfer)
  • L/C (Letter Of Credit)
  • Alibaba Trade Assurance
  • PayPal
  • Western Union/Money Gram

1. Telegraphic Transfer T/T

Telegraphic Transfer is one the most used way to transfer your money to the Chinese suppliers. Almost all suppliers will happily accept the Telegraphic transfer method. Also If a supplier asks for wire transfer, that is T/T. The Telegraphic Transfer method is not very fast, and it takes time to transfer money, typically 2-3 working days.

1.1 The right way to pay

First of all, you should know the payment term as well while paying by Telegraphic Transfer. You have to deposit some amount of upfront requested by the seller, and this amount is usually 30% of the total. The other 70% is to be deposited after the production of the order or completion of the cargo loading.

In this case, both the buyers and the sellers are at risk as sometimes the transaction is not completed even after the buyer has deposited the money, and the buyer may lose interest afterward when production is finished.

1.2 Making a payment

The most crucial step is of making your payment. Probably you need to present in your bank or use an online banking service to make your payment to the supplier. The supplier may have already provided you with the pro forma invoice where all their banking information is included. A T/T bank information should include:

  • Beneficiary Name
  • Beneficiary Bank
  • Bank Swift Code
  • Beneficiary Account Number
  • Beneficiary Bank Address
  • Beneficiary Address (Company Address)

There are occasions that the buyer’s local bank will ask for intermediary bank account details as well. You’d better double-check with the counter as this sometimes turns to be unnecessary. After filling the forms, you can save it in the form of a picture or a digital copy by email and send it as proof to your supplier. In addition, Take care of these points before making any payment.

  1. The supplier name on the pro forma should be the same as the beneficiary name, or your bank will refuse to make it.
  2. Keep it free from any spelling mistakes and double-check it to make sure that everything is correct.
  3. In case there is not enough space to input for certain information, you can add full information in the remark section.
Attention Yiwu Market Agent Tricks

Be safe from any scam. Hackers may send you their invoices with their associated bank accounts to scam you. To avoid this bad scenario, double-check the email address which sent you the bank information and make sure it is the same as the first email address from the supplier.

1.3 4 Checks to Make Before Paying

Before you make a payment, here are a few things to check as well.

Is your Supplier Solo or a Company?

Making this check can help you to prevent many scams. You can make sure that whether your supplier is an individual or a company and the account provided by his/her company is a corporate account or not.

If you are a little bit familiar with Chinese names or with some company names, then you can easily confirm which one is an individual and which one is a company.

The individual names could be something like ZHANG LIN, YUAN WEIKANG, HE MIAO, etc. And some company names could be in the form of SHANTOU *** TOYS CO., LTD, SHENZHEN *** ELECTRONICS CO., LTD, ZHEJIANG *** TRADE CO., LTD, *** IMPORT & EXPORT CO., LTD, or maybe something like *** INTERNATIONAL INDUSTRIES CO., LTD. The point is that you should always check for the written name before making your step towards the payment.

Check for the supplier’s correct entity

Suppose you are dealing with a Chinese supplier company and suddenly that company asks for payment to a different bank account. This happens very often, and you have to do something about that.

The name of the supplier and the company with whom you are cracking a deal should be the same. You can confirm every bit of information on various platforms like the company’s website, their page on Alibaba, Brochure, and Invoice, etc.

Check if the company’s name is the same everywhere, if it is not the same, then you should investigate why. In order to use the SWIFT system with T/T, the Chinese companies’ names should be provided in English, not in their own Chinese language. Just get the correct spellings with the correct words to fill out the form.

Bank Location for the payments

To keep everything safe and sound, make sure that the company bank is from the same city from where the actual company is located. The bank details will be provided by the company itself. You should research the company and its location.

Suppose the company is asking to make payments to a different city than its real location, then it’s possible that they are not directly making the payment. You’d better talk to them to find out why.

Are they providing an on-shore or off-shore account?

Finally, you also have to check whether the account is offshore or onshore. There are many Chinese companies owning offshore accounts in Hongkong as well. Once you are sure that their account is offshore, then you have to take other things in the notice. The bank account number which is provided by the company mostly contains 18 digits.

If you see a three-letter prefix before the account number, then it’s probably an off-shore account. These are some related prefixes that you should know:

  • Off-shore account (OSA)
  • Non-Resident account (NRA)
  • Free trade Non-Resident account (FTN)

There are many banks in china that offer offshore accounts. You should make sure to input the three-letter prefix with the account number when you are making a payment, or the payment will not be made successfully.

2. Letter of Credit L/C

The Letter of Credit is more secured than T/T for both the buyer and the seller. The L/C conditions are decided between the buyer and the seller, and the payment is automatically sent once the decided conditions are fulfilled. It totally depends on both of the sellers and buyers that what type of documents they have to provide in order to complete the transaction.

You need to go through the following process if you have chosen L/C as an option to make a payment. Here’s how it is done step by step and just stick to these steps if you want to make payment successfully to your Chinese supplier.

  1. Both the buyer and seller agree upon a set of statements they have decided, and they sign on an agreement.
  2. The buyer goes to his/her local bank for the L/C policy.
  3. The buyer applies the draft L/C from his/her bank and sends it to the seller’s bank.
  4. It’s time for the production to start once official L/C is opened.
  5. The seller works with the buyer for the product test and quality checks after the production is finished.
  6. The seller will arrange shipping after inspection of the goods and submit related documents to his/her local bank.
  7. The seller’s bank will ask for the final payment from the buyer’s bank. After fulfillment of all conditions, a successful transaction is made

3. Alibaba Trade Assurance

It’s another safe and convenient method that works like the Letter of Credit (L/C). To be exact, Alibaba trade assurance is to protect your payment to Chinese suppliers When you are buying from But you know that not all the suppliers are listed on In addition, only a limited number of suppliers on are Alibaba Trade Assurance protected.  

Alibaba Trade Assurance
Alibaba Trade Assurance Features

Unlike L/C you have to add funds to your Alibaba account for a successful Alibaba trade Assurance. Telegraph transfer or your credit card can add these funds. More details are available on Alibaba Trade Assurance.

4. PayPal

Almost everybody knows about PayPal, and it is a very fast and convenient way to send and receive funds. However, it is not used for very large transactions. For medium transactions, PayPal works great, but it cahrges a lot of fees around 3.4 – 4.4%.

Many suppliers may not accept PayPal transactions for their own reasons. For example, only up to US$ 50,000 can be withdrawn and exchanged to a Chinese residential bank account. It is suggested to make the sample cost transfer by PayPal.

5. Western Union/Money Gram

Payment to China Suppliers by Western Union
Payment to China Suppliers by Western Union

Western Union and Money Gram can also help you make payments to Chinese suppliers in international trade. Those 2 ways are easy if you could find a counter nearby your living area. And They do realize instant transfer. However, it’s not recommended when you are starting a new relationship with a supplier as it’s hard to track and get the refund. In our opinion, the same as PayPal, they are good to make a transfer of sample cost.

6. Questions You May Ask

1, Which one is the safest method to make payment to Chinese suppliers?

L/C may be considered as the safest way to make an international transfer. And Western Union and Money Gram are considered very risky because there is no option to refund in a scenario of some mishap.

2, Do Chinese suppliers only accept USD currency?

No, Chinese suppliers are not only bound to USD currency. They also accept other currencies such as Euro, GBP, and their RMB currency. Most suppliers will choose USD because of the country’s money outflow, but the condition is different for HongKong where they have a very free economy.

3, What are the typical payment terms dealing with a Chinese supplier?

Generally, the Chinese suppliers will ask for a 30% deposit and 70% before shipping in the first time of business. Once you have a long relationship with them, you can pay probably a lower deposit and the rest against scan copy of the Bill of Loading.

4, Is it possible to pay the suppliers after the arrival of the products?

Technically it’s not possible to pay your supplier after your products have arrived at you. It pushes your seller to higher risk, and they want that risk to stay minimized. It can be possible if you have a very steady relationship with them. They probably will give you that credit after investigating your credit status and buying insurance from companies like Sino-sure (China Export Credit Insurance Corporation).

How to open a Chinese bank account for a foreigner?

China mobile payment is developed and handy. But to use it, you have to open a Chinese bank account. Or you cannot enjoy the convenience of WeChat Pay or Alipay.

  1. Be in China

    As a foreigner, you have to be in China to open a Chinese bank account. No one can do this for you.

  2. Appoint a few banks

    Policies are getting stricter to open bank accounts in China for foreigners. You’d better appoint more than one bank in China to consult. It’s no need to appoint those big branches. They will not be interested in doing this. Here are some popular mainland China banks
    • Agricultural Bank of China
    • Bank of China
    • Bank of Communications
    • China Construction Bank
    • China Everbright Bank
    • China Merchants Bank
    • Postal Savings Bank of China

  3. Prepare documents

    If you have a work or study visa to China, it shall be easy to open the bank account. If it’s a tourist visa, it may be hard. Normally, your passport with the visa page is required. A minimum of 60-90 days’ stay and a temporary living address issued by the Chinese police will be beneficial to open the bank account. It does not charge any cost but may ask you to deposit 50-100 RMB to activate the bank account.

  4. Go open the account

    The last step is to visit the bank and submit the material. You will get the bank account if your material is following their requirements.

After you successfully get a Chinese bank account, you will find it so easy to make transfers, even the amount is limited.

At last, making payments to Chinese suppliers could be one of the main concerns when sourcing products from China. And it’s never wrong to be more careful when you are making a transfer.