Paying A Supplier In EUR From A USD Business: The Exact Steps To Avoid IBAN Errors And Returned Payments

Key takeaways

• Most returned EUR payments are caused by small data issues: a wrong IBAN, a missing SWIFT/BIC, or routing fields filled in incorrectly.

• Your safest workflow is collect once, validate once, then reuse verified vendor details for every payment run.

• Choose the right rail first (SWIFT vs SEPA), then enter the payment with a clean reference so your supplier can reconcile it fast.

Paying a European supplier in EUR from a USD-based business should be routine, but the first payment often feels like a test. Your bank portal asks for terms like IBAN, SWIFT/BIC, intermediary bank, charge options, and reference fields that are not always obvious.

This guide walks through the exact steps to send EUR successfully, avoid the wrong-IBAN problem, and reduce the chance of a payment being returned or going missing in review.

Before You Start: Pick The Right Route (SWIFT Or SEPA)

There are two common ways EUR payments move:

SWIFT (international wire style payments): This is the most common route for USD businesses paying overseas suppliers through a bank’s international payment flow. SWIFT is the messaging network banks use to send payment instructions.

SEPA (EUR credit transfers within SEPA): SEPA is the European framework for EUR payments using SEPA payment schemes developed and administered by the European Payments Council.³⁴ If your bank or provider can initiate SEPA credit transfers, EUR payments to many European suppliers can be simpler and often require fewer routing fields.

Practical rule: if your payment screen says “international wire” or asks for SWIFT/BIC, you are likely sending via SWIFT. If it says “SEPA credit transfer,” you are in the SEPA flow.

What You Need From The Supplier (And Why Each Field Matters)

If you only do one thing from this article, do this: ask your supplier for bank details in a structured format, not in a paragraph of email.

Here is the minimum set that prevents most failures.

Vendor Details Table (Copy This Into Your Intake Form)

Two key definitions help reduce confusion:

• An IBAN starts with a two-letter country code and two check digits, followed by up to thirty alphanumeric characters for the domestic account structure.²

• A BIC is an 8-character code¹ and can include an optional 3-character branch identifier, which is why many systems accept 8¹ or 11¹ characters.¹

Step By Step: Pay A EUR Invoice Without Getting It Returned

Step 1: Confirm What Must Be Paid In EUR

Before you touch the bank portal, confirm these details from the invoice and your AP system:

• The invoice is payable in EUR and the amount is final.

• Your due date and internal approval timeline are realistic.

• Your supplier expects the full invoiced amount to arrive (important if fees could be deducted in transit).

If your payable is time-critical, avoid initiating on the due date. That is when both operational cutoffs and market volatility can work against you.

Step 2: Collect Details Using A Structured Intake Form

Do not accept bank details as a loose email paragraph. Ask for them using a standard template, and store them where your team can reuse them.

A simple practice that prevents errors:

• Require suppliers to submit bank details in your standard format.

• Require an “effective date” for new instructions.

• Store a version history so you can see what changed and when.

If you need an internal starting point, use payment methods as a reference for building consistent cross-border payment workflows.

Step 3: Validate IBAN And BIC Before You Send

This takes two minutes and saves hours later.

IBAN validation checks

• The IBAN begins with the correct country code for the supplier’s bank.

• The check digits are present.

• The length looks right for that country (length varies by country, so do not assume all IBANs look the same).²

BIC validation checks

• It is 8¹ or 11¹ characters.

• It matches the bank and country you expect.

• It is not a routing number or domestic code pasted into the wrong field.¹

Tip: if you want a quick formatting check, use tools like SWIFT lookup and IBAN calculator. These help catch obvious format issues, but you should still rely on supplier-provided instructions as your source of truth.

Step 4: Enter The Payment In Your Bank Portal Carefully

When you create the payment, slow down at the fields that trigger returns.

Do

• Set payment currency to EUR.

• Copy and paste the IBAN and BIC from the verified source.

• Enter the beneficiary name exactly as provided.

• Add a clean reference that matches your invoice and PO.

Do not

• Reformat IBANs “to make them look right.”

• Guess intermediary bank details.

• Use internal nicknames for the beneficiary.

Step 5: Handle The Two Fields That Cause The Most Rework

These two are the biggest “first payment” tripwires:

Intermediary bank: Only fill this if the supplier’s instructions include it. Guessing can create detours and delays.

Reference (remittance info): Keep it short and structured so it survives different bank formats. A reliable pattern is:

• Invoice Number | PO Number | Your Vendor Code

This small habit makes month-end reconciliation faster and reduces supplier follow-up.

Step 6: Send Early Enough To Beat Cutoffs

Returned payments are not the only problem. Payments can also land late because they were initiated too close to cutoffs.

Build a buffer:

• Initiate international payments at least one business day before the due date if possible.

• Avoid late Friday approvals if your supplier expects Monday receipt.

• If you run pay cycles, schedule them earlier in the week and keep timing predictable.

If you send multiple international payments, scheduled payments can help you remove last-minute execution risk from your process.

Common Reasons EUR Payments Get Returned (And How To Prevent Them)

What To Do If Your Supplier Says “We Didn’t Receive It”

If a supplier claims the payment did not arrive, do not start by re-sending. Start by collecting proof and confirming details.

A practical sequence:

• Pull your payment confirmation and status from your bank portal.

• Ask your bank for a SWIFT payment confirmation copy if available (often referred to as an MT103 copy).

• Confirm beneficiary name, IBAN, and BIC against the supplier’s latest instructions.

• If the supplier recently changed bank details, treat it as a controlled change request and re-verify through a second channel.

Build It Once: A Vendor Payment Intake Form For EUR Suppliers

Here is a lightweight template you can turn into a form in minutes.

Vendor identity

• Legal name

• Country

• AP contact email

Payment instructions

• Beneficiary name on account

• Beneficiary address

• IBAN

• Bank name and bank country

• SWIFT/BIC

• Intermediary bank required? (Yes or No)

• If Yes: intermediary bank name and SWIFT/BIC

• Preferred payment reference format acknowledgement (checkbox)

Change control

• “If bank details change, we require verification via a second channel and two-person approval.”

This is the part that prevents the worst outcomes, because bank detail changes are where both errors and fraud risks spike.

FAQs

Do I always need a SWIFT/BIC to pay a EUR supplier?

Often yes for SWIFT-style payments. For SEPA credit transfers, IBAN-only processing has been supported under SEPA requirements in many cases, because many euro payment accounts can be identified using IBAN without additionally specifying BIC.⁵ Your bank’s UI will usually make it clear which identifiers it requires.

Can a USD business send SEPA payments?

Sometimes. It depends on whether your bank or provider supports initiating SEPA credit transfers. SEPA schemes are governed by SEPA payment scheme rules developed by the European Payments Council.³⁴ If your provider offers SEPA, your payment flow will usually say “SEPA credit transfer” rather than “international wire.”

How should I format the payment reference?

Use a short, consistent pattern like invoice number plus PO. Long references can be truncated in some bank flows, so keep it structured and compact.

Should I convert to EUR earlier or pay on the due date?

Many finance teams prioritize predictability over timing. If you can reduce last-day execution risk, you usually reduce operational errors too.

What if the supplier sends new bank details by email?

Treat it as a change request, not an instruction. Verify through a second channel and use two-person approval before updating the vendor record.

Conclusion

Paying a EUR supplier from a USD business is mostly about disciplined execution. Collect the right details, validate them before the first payment, avoid guessing routing fields, and standardise your references so reconciliation stays clean.

How Xe Helps

If your business pays EUR suppliers regularly, Xe Business can support international payment workflows and reduce operational friction, especially when you are managing multiple vendors and deadlines. You can explore international payments, set predictable timing with scheduled payments, streamline supplier runs with batch payments, and strengthen your process with security and fraud guidance.

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The content within this blog post is for informational purposes only and is not intended to constitute financial, legal, or tax advice. All figures and data are based on publicly available sources at the time of writing and are subject to change. Actual conditions may vary depending on location, timing, and personal circumstances. We recommend consulting official government resources or a licensed professional for the most up-to-date and personalized guidance.

Citations

¹ Swift — Business Identifier Code (BIC) — (2026)
² Swift — IBAN Registry — (2024)
³ European Central Bank — Single Euro Payments Area (SEPA) — (2026)
⁴ European Payments Council — SEPA Credit Transfer Rulebook And Implementation Guidelines — (2026)
⁵ EUR-Lex — Regulation (EU) No 260/2012 (Technical Requirements For Euro Credit Transfers) — (2012)

Information from these sources was taken on February 4, 2026.