4 Benefits of a Multi-Currency Account for Your Business and How to Choose the Right Provider

Today, in an increasingly digital and interconnected world, new professions are emerging and becoming an integral part of our daily activities. This growth can be attributed to various factors, despite the impact of the Covid pandemic and the global economic crisis over the past two years.

The best evidence is the Europe e-commerce industry has experienced significant growth in recent years, with its market share expanding not only in this continental but also worldwide. Additionally, the tourism industry and online travel agencies (OTAs) have also witnessed substantial development.

In light of the extraordinary industrial advancements worldwide, it has become imperative for businesses to integrate more contemporary digital payment methods that are universally applicable. One such method is the utilization of multi-currency accounts for business transactions.

What are multi-currency accounts for business? How do they work?

What are multi-currency accounts for business?

Assuming that your enterprise is based in Vietnam and there arises a requirement to remit payment for a substantial quantity of goods imported from the United States, what are the various methods available for executing this transaction? Usually, there are 6 ways:

• Open account method

• Remittance method

• Collection method

• Method for requesting payment of documentary credit

• Method of authorization letter to purchase (A/P – Authority to Purchase)

• Guarantee or standby credit

The shared characteristic among these six payment methods is their substantial reliance on the financial institutions of both the purchaser and recipient, who are located in two distinct nations.

This dependency can give rise to numerous complications concerning transaction timing and disparities in currency exchange rates across different banks. Such issues considerably influence price discrepancies and subsequently, the profitability of all involved parties.

Currently, multi-currency accounts for businesses have been established to serve the aforementioned purpose.

These accounts assist enterprises in setting up a debit business account that can be converted into various regional currencies globally at the most standard exchange rate determined by the central bank of the respective country or territory and is managed by a single API-integrated software from the supplier.

How do multi-currency accounts for business work?

The operation of a multi-currency account resembles that of a standard bank account. However, the payment process occurs in real-time, and the recipient can immediately receive the payment in the currency of their residing country or territory without having to go through any complex procedures like typical bank transactions.

Nonetheless, as this account is established by a fintech firm tasked with managing transactions for a company utilizing a multi-currency account, the business owning the account will not have direct access to the transaction counter. Instead, all communication will be facilitated through the customer care department via telephone.

4 benefits of a multi-currency account for your business

1. Bring the best experience for your business.

The transaction will have a lower cost.

As in the case mentioned above, when there is a cross-border transaction with any international partner, the payment process of the business must go through 2 banks with many different fees, not to mention the exchange rates will be different.

This will lead to loss of costs in transactions between the two parties, affecting the profits of both companies buying and receiving goods or services.

The advent of multi-currency account services will effectively address the aforementioned issue. Transactions can now seamlessly transition from Company A to Company B, facilitated by the robust payment and currency conversion system provided by Fintech Company C without any additional costs for 2 banks in 2 different countries.

The transaction will be faster.

Transferring money from 2 banks in 2 different countries not only makes the transaction cost more but also makes the money flow move very slowly, which greatly affects the operating system and accountants. With the application of a real-time payment system, transactions can be transferred directly from company A to company B immediately via a money transfer order from fintech company C.

Easy and convenient to make money transfers.

If you transfer money the old way, the business's accounting department must prepare dozens of documents and documents to be able to set up money transfers and receive money from your foreign partner. Now, with just a few simple steps on the API-integrated payment system, the accounting department can easily process payments without having to go through the above-complicated steps.

2. Better supplier relationships

*A happy supplier means better deals on material, consistent service, and a budding business relationship. Also, a supplier who gets paid in their preferred currency doesn’t have to wait or pay for conversions is bound to be a happy supplier.

A multi-currency account helps keep your business in the good books of your partners, suppliers, and clients. Everybody likes to get paid in their own currency without the burden of conversion costs, a foreign currency account helps do all this with ease.*

*Source: Volopay

3. Easier reconciliation and accounting

Because of having to face dozens of paperwork if transactions arise in the old form, during accounting and auditing periods, it will be very difficult for the accounting department to calculate and compare (especially when the exchange rates of 2 banks in 2 countries will change regularly).

However, when making transactions through a multi-currency account, the transactions will be saved on the company's management system, and for each different currency there will be different notes (depending on the setup method by the financial manager) will make it easier for the control and calculation of the corporate accounting department.

4. Expense management

** An international currency account is also extremely useful in making expense management a whole lot easier for your finance teams. These accounts cancel the need to match invoiced and paid amounts in different currencies. Accounting adjustments required to accommodate exchange rate differences also become much easier.

Moreover, because these accounts function similarly to holding accounts, you can wait it out until exchange rates are favorable enough for you to convert currencies. Basically, multi-currency business accounts provide you with a single platform to conduct all forex transactions; this also means all your transactions are logged in one structured place from where your finance teams can manage expenses.*

**Source: Volopay

How to choose the right provider to open a multi-currency account for your business?

Because of the importance and convenience that multi-currency accounts bring to businesses, you should not choose a partner that provides this service if they do not:

• Have multi-partners to cover the currencies.

If you are a business or an international online shop, of course, you need your account to be able to handle the most currencies in the world so that international customers can pay for your products most easily. That is also the advantage of companies that have a network of partners across countries to be able to provide the most suitable fees and exchange rates for their clients' businesses.

For instance: FinFan has an extensive list of partners covering countries that own popular currencies in the world such as US dollars, British Pounds, Euros, Japanese Yen, etc. This will help our customers feel secure in cross-border currency exchange with the most reasonable exchange rate for users.

• Have a fast transaction speed.

As mentioned above, what makes this multi-currency account service special compared to other types of services is its real-time settlement capabilities.

Therefore, multi-currency account service providers need to improve functionality and have a large network with local banks in countries around the world. That will make the payment process go faster.

**For example: FinFan 's technical and product research teams have worked day and night to improve the speed of money transfer from many different countries around the world to Vietnam.

**Today, even if the transaction is miles away, the recipient in Vietnam will receive the transaction immediately through FinFan's collection and payment method licensed by the State Bank of Vietnam.

• Have a good customer service and support.

As mentioned above, customer care for this service is extremely important when they cannot go to any bank branch around the world to have support for the problem of multi-currency accounts, everything goes through the service of a fintech company (in contact with the bank) to provide the account.

Therefore, if the customer care team of the fintech company providing the service cannot promptly support arising problems such as erroneous transactions, or blocked transactions by the KYC and AML systems, the sender will transfer the wrong account, etc., there is a high possibility that it will have a direct and even greater impact on the business operations of businesses using the service.

A typical example is that FinFan's support team always tries to support customers in the most optimal way to best handle the problems they encounter.

• Have additional services and features.

*** Beyond multi-currency accounts, some providers offer features such as international card acceptance, recurring payments, seamless invoice management, integrated financial solutions, etc.

Embracing these conveniences amplifies the efficiency of international money transfers, streamlining processes. Moreover, the advantages of consolidating services with a single provider become evident—centralized management simplifies fund tracking and service coordination, optimizing operational ease.

By strategically selecting a provider that offers a comprehensive suite of tools, businesses ensure a secure, cost-effective, and time-efficient transaction journey, all while enjoying the benefits of streamlined partnership management.*

***Source: PayGlocal

Knowing that FinFan has been trying to develop more features of its products and services. Currently, customers using FinFan's multi-currency account service can also use that money to pay for services when traveling on business or for international sim cards, etc.

At the same time, all transactions will be displayed in the most detailed and easy-to-understand manner on a toolbar designed specifically for each income and expenditure management needs of corporate financial managers.

• Have a team specializing in regulatory compliance.

** ** In the realm of multi-currency accounts, regulatory compliance emerges not only as a legal requirement but as a business imperative. The right account provider ensures strict adherence to regulations across both the sender's and recipient's jurisdictions.

This commitment acts as a protective shield against potential risks, including the alarming threats of money laundering and counter-terrorist financing (CTF) in cross-border transactions. Opting for a provider that demonstrates an unwavering commitment to AML and CTF regulations establishes a line of defense against potential risks, safeguarding your financial interests, while maintaining a trusted international business environment.*

**** Source: PayGlocal

FinFan always operates based on the laws of the applicable countries and Vietnam, all KYC and AML processes are carried out very carefully by us and our partners.

About FinFan

FinFan is a cross-border embedded financial services company that focuses on mass disbursement, fund collection, card processing, IBAN, and digital APMs solutions, which can provide valuable input and integration on and for the same.

FinFan is already integrated with almost the world's well-known MTOs, PSPs, switch, and core fintech platforms such as Money Gram, Thunes, Qiwi, Remitly, World Remit, Bancore, PaySend, Terrapay, Ria Money Transfer (Euronet), Dlocal, Ripple, TripleA, FoMo Pay, Wings, etc.

For more information, please get in touch with us through:

🌐https://finfan.io

📞(+84) 2866 85 3317

✉ support@finfan.vn

LinkedIn: FinFan