The Benefits of Accepting Multiple Currencies
When expanding into international markets there’s already a number of challenges to overcome, such as legal and regulatory issues. However, one of the most important issues to determine — is whether or not to accept multiple currencies.
In the past, this was pretty complicated problem, since it involved exchange rates, security risks, and managing all of this data in your internal accounting systems. However, since we’re living in an increasingly smaller world where we have a plethora of technology at our fingerprints, accepting multiple currencies has never been easier.
But, is it really worth accepting multiple currencies in the first place?
If you want to increase sales and expand into new markets, the answer is most definitely yes.
If you’re still on-the-fence, here are the benefits of accepting multiple currencies.
Eliminates foreign transaction fees.
Who likes to pay extra money for a product or service that your really want just because you reside overseas? I don’t think any of us do.
By accepting multi-currencies you’re eliminating expensive foreign transaction fees for your customers – which may prevent them from doing business with you again. Instead, your customers will appreciate that you’re saving them money which could entice them to return for future purchases or refer you to their friends, family, or colleagues.
Improves customer loyalty.
When your customer reviews their bill, receipt, or shopping cart and it’s in their local currency, they know instantly how much they’re going to be charged, which prevents any confusion, questions, or surprises.
When your international customers have this type of clarity it can boost customer loyalty since they trust your business and feel comfortable shopping with you since they know that they’re not getting taken advantage of.
When customers question a charge or don’t understand a statement they may dispute the charge. This can result in chargebacks for your business. Chargebacks aren’t just annoying, they can consume your valuable time and even lead to fees or penalties – which can harm your reputation and cash flow.
However, if customers understand these changes they’ll be less likely to dispute them which means you eliminate chargebacks from the get-go.
When you accept multiple currencies you’re able to differentiate your business from your competitors. In other words, if you accept a local currency, such as the yen, but you’re competitor, who is also conducting business in Japan, gives you the upper hand.
Prevents cart abandonment.
According to Statista, 13 percent of online shoppers will abandon a site when prices are presented in a foreign currency. Additionally, as previously discussed, when a customer makes a purchase in a foreign currency, their banks could impose foreign transaction fees, which penalizes them for shopping at your online store.
By not limiting your customers to just one currency, you’re preventing cart abandonment, which is always good for your bottom line.
Tips for selling in multiple currencies.
If you’ve been convinced that the benefits of accepting multiple currencies outweighs the disadvantages, here are a couple of pointers to get you started:
- Support the currencies of your customers. Don’t spread yourself too thin by accepting very currency. Stick with the currencies that you customers use of prefer by either asking them or by taking a look at where most of your customers reside.
- Automate pricing. Instead of manually converting currency exchanges look apps or payment solutions that do this for you automatically.
- Find the right platform. Speaking of payment solutions look for platforms that offers a multi-currency functionality, such as PayPal, Braintree, WorldPay, Stripe and Due.
- Update your website. Note on your site that you accept multi-currencies and include a multi-language toggle so that customers in various languages can read the information on your site.
- Look in an exchange rate in advance. Consider purchasing a, “forward contract,” from a bank or nonbank specialist. This will lock in your exchange rate for a set period of time.
- Build trust. Go above and beyond your competitors. Do your research and learn about the customs and preferences of various global markets. Hire team member and locals who are familiar with overseas markets.
- Accept cryptocurrencies. Accepting cryptocurrencies occur in real-time, are secure, and eliminates foreign transaction fees.