Published on
February 23, 2024

Choosing the Best Multi-Currency Account for Businesses

min read

In an age of global interconnectedness, international transactions have surged in popularity among businesses worldwide, necessitating efficient solutions for managing multiple currencies. According to Flow, more than 60% of online shoppers express a preference for purchasing goods directly from another country.

In response to these evolving dynamics, financial institutions, including both traditional banks and fintech companies, have innovated their offerings with the introduction of the 'multi-currency account'.

For businesses involved in cross-border transactions, the multi-currency account emerges as a transformative solution, facilitating the management of diverse currencies and capitalising on currency exchange rates.

One of its most appealing aspects? It streamlines the arduous task of overseeing multiple bank accounts, ultimately saving considerable time and effort.

This article will explore the concept of the multi-currency account, how it works, the considerations you should factor in before choosing a cross-border payment specialist that meets your business needs.

Recap: What is a Multi-Currency Account?

A multi-currency account, alternatively referred to as a foreign currency account, serves as a versatile financial tool enabling both businesses and individuals to efficiently manage, conduct transactions, and retain funds in various currencies within a singular account. Its primary function revolves around simplifying international transactions for account holders.

A multi-currency account (MCA) is a versatile financial tool that enables businesses to send, receive, and store multiple currencies within a single account. Unlike maintaining numerous accounts across different countries, an MCA consolidates all currencies under one umbrella, simplifying international financial management.

Moreover, it serves as a shield against expensive and volatile currency conversion rates, granting users the flexibility to convert currencies at their discretion and capitalise on favorable exchange rates.

🔑 Read More: Multi-Currency Account (MCA) Explained: What Is It and How Does It Work?

Recap: How does the Multi-Currency Account Work?

The functionality of an MCA revolves around currency sub-accounts, allowing users to hold various foreign currencies alongside their local currency. When making transactions, the system automatically selects the appropriate currency sub-account, eliminating the need for manual conversion. Moreover, some MCAs offer linked debit cards or multi-currency cards for seamless transactions worldwide.

A multi-currency account boasts a versatile functionality, operating similarly to a standard bank account but with the added capability of managing diverse currencies seamlessly.

This functionality is underpinned by three fundamental features:

  1. Receive various currencies: Account holders can receive funds from the assortment of available currencies, depending on the institution providing the service.
  2. Retain these currencies within the account: Account holders have the flexibility to choose when and how to use the funds, giving them the autonomy to select the best prevailing exchange rates that suit their needs for the transaction.
  3. Execute payments in different currencies: Account holders can initiate and execute transactions such as purchases, transfer, or withdrawals.

Remarkably, all of these functions occur within a single account, enhancing operational efficiency.

🔑 Read More: International Business Payment 101: The Only Comprehensive Guide You Will Need

What Charges are Linked to a Multi-Currency Account (MCA)?

The fees applicable to a Multi-Currency Account can fluctuate depending on the bank or financial institution providing the service. Let’s explore some typical fees you may encounter:

  1. Account maintenance fee: A monthly or annual maintenance charge may apply for certain MCAs but they are usually waived provided the account holders maintain a minimum balance in the account.
  2. Currency conversion fee: When converting funds from one currency to another, like from the Singapore Dollar (SGD) to Indonesian Rupiah (IDR), a currency conversion fee may be imposed. It's crucial to verify prevailing rates to secure a competitive rate.
  3. ATM withdrawal and foreign transaction fees: Utilising an ATM to withdraw funds while overseas might incur fees for international ATM withdrawals – this includes charges from both the bank and ATM operator.
  4. Inactivity and card replacement fees: Certain MCAs could enforce inactivity fees in the event the account remains dormant for a specified duration. This fee is designed to incentivise account usage. In other scenarios, card replacement fees may be applicable.
  5. Online transfer, overdraft, and wire transfer fees: Although multiple MCAs do offer complimentary online transfers between sub-accounts, it is still good to validate this, as certain banks may impost levy fees for online transfers on all foreign transactions (including overdrafts and wire transfers).

Choosing the Best Multi-Currency Account for Businesses

Choosing the appropriate MCA can have profound implications for your business operations, financial management, and overall success in navigating the complexities of international transactions.

Let’s explore the key considerations that goes into choosing the best multi-currency account that suits your business needs:

Speed of Transactions

When selecting an MCA, prioritise providers that offer rapid processing of international payments and transfers. Swift transaction processing ensures that funds are promptly transferred to their intended recipients, facilitating efficient business operations and minimising delays in payment settlements. This is particularly crucial for businesses engaging in time-sensitive transactions or requiring immediate access to funds.

Dedicated Support

Look for MCA providers that offer personalised assistance tailored to navigating the complexities of cross-border transactions. Dedicated support teams can provide invaluable guidance and expertise in managing international payments, addressing any queries or concerns promptly, and ensuring smooth transactional experiences. This personalised assistance enhances confidence in the MCA provider and fosters trust in their ability to meet your specific business needs.

Security Measures

Prioritise MCAs equipped with robust security features designed to safeguard sensitive financial data and transactions. Security is paramount when conducting international transactions, as the risk of fraud and cyber threats is heightened across borders. Ensure that the MCA provider implements stringent security protocols, such as encryption technologies, multi-factor authentication, and real-time transaction monitoring, to mitigate the risk of unauthorised access and fraudulent activities, thereby safeguarding your financial assets and maintaining data integrity.

Competitive Exchange Rates

Choose an MCA provider that offers competitive exchange rates to minimise currency conversion costs. Exchange rates play a significant role in determining the cost-effectiveness of international transactions, impacting the final amount received or paid in foreign currencies. By opting for an MCA provider that offers favorable exchange rates with minimal markup fees, businesses can optimise currency conversions and maximise the value of their transactions, ultimately reducing overhead expenses and enhancing profitability.

User-Friendly Interface

Select an MCA with an intuitive online banking platform that facilitates seamless account management. A user-friendly interface simplifies the process of monitoring account balances, reviewing transaction history, initiating transfers between sub-accounts, and tracking exchange rate information. An intuitive online banking platform enhances operational efficiency, enabling users to navigate the MCA effortlessly and perform essential banking tasks with ease. Additionally, consider MCA providers that offer mobile banking applications, allowing for convenient access to account services on the go.

🔑 Read More: The Ultimate Checklist: What Does a Top-Notch B2B Payment Solutions Provider Look Like?

What You Get With a Wallex Multi-Currency Wallet

Ease of facilitating FX transactions

With you being able to hold and manage 13 currencies in one wallet, here's other benefits you will experience:

  • Utilise your Wallet in combination with powerful global payment tools to facilitate your FX transactions
  • Reduce your transaction costs when making or receiving payments in foreign currencies
  • Flexibility to time your payments and conversions when FX rates are favourable to you

Access to competitive FX rates

Streamline your cross-border operations and reduce the impacts of FX volatility while getting access to competitive near mid-market rates:

  • Minimise FX costs with better than bank exchange rates
  • FX rates customised to your business needs
  • The more you trade FX with Wallex, the greater your savings

Enjoy a streamlined multi-currency business account

Expedite your entry into new markets and streamline the way you do business across borders with the Wallex multi-currency business account:

  • Connect seamlessly to powerful cross border tools designed for businesses
  • Competitive FX rates on top global and Asian currencies
  • Enter new markets with confidence with a hassle-free account setup

Join 40,000+ Customers Who Switched To Wallex

Selecting the right multi-currency account is crucial for businesses engaged in international transactions. By considering factors such as transaction speed, support services, security measures, and fee structures, businesses can streamline their global financial operations.

With innovative solutions like Wallex's multi-currency wallet, businesses can navigate the complexities of cross-border commerce with ease, ensuring seamless transactions and cost-effective currency management.

Schedule a demo with us today and see why Wallex is the best multi-currency wallet for your business.

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