How to Use a Multi-Currency Account to Pay International Suppliers20 min read

How to Use a Multi-Currency Account to Pay International Suppliers20 min read

In our modern world, making international payments is a necessity for companies that want to expand globally. However, international transactions like paying international suppliers often result in delays and costly fees for companies.

That is where the multi-currency account comes in handy. The international multi-currency account is crucial for companies since it lets customers avoid high fees and lets them hold and pay in different currencies. This article answers the question “What is a multi-currency account?”

To prevent losing money or facing delays, having a multi-currency account is a must for businesses. Having an international multi-currency account helps customers pay international suppliers seamlessly, avoid costly fees, and save money. 

How Can a Multi-Currency Account Simplify Payments to Global Vendors?

Without a multi-currency business account, businesses face a lot of problems. Here’s a list of commonly faced problems and solutions that a multi-currency account for businesses helps with.

• Paying in only one currency may be problematic and costly for businesses that want to expand globally. Since exchanging funds in only one currency means that suppliers must charge extra for conversion fees, the fee will add up quickly.

That is where a multi-currency account comes in, making the process much smoother. Multi-currency accounts allow customers to hold different currencies in just one account, making sure businesses can pay international suppliers in their own currency.

• Businesses know that banks sometimes add hidden fees or offer poor FX conversion rates. But having a multi-currency business account means that one can easily avoid conversion fees and pay their suppliers directly the exact amount they agreed upon.
• Traditional international payments take longer since the transaction goes through intermediary banks. But having a multi-currency account often means faster transactions since extra conversion fees and intermediary banks are deemed unnecessary.
• Working internationally means sometimes keeping track of multiple international payments, and that can be confusing. But since multi-currency accounts allow businesses to hold different currencies in one account, managing cash flow becomes easier since everything is in one place.

In summary, having a multi-currency account means avoiding costly exchange rates, being able to control cash flow easily, and having faster transactions. 

To learn about our policies and how to open a multi-currency account, visit our website at The Kingdom Bank. 

What Are the Steps to Set Up a Multi-Currency Account for International Payments?

Setting up a multi-currency account to easily transfer international funds for a business is crucial. 

Here are the necessary steps to take for a seamless experience:

1. Choosing the Right Provider- Before applying for an account, businesses must choose between traditional banks and fintech platforms. To easily choose the provider, comparing fees, available currencies, and transaction speed will be enough.
2. Checking the Requirements- Different documents or business registration documents may be necessary. So, it’s safe to say that, before applying for a multi-currency account, checking eligibility is crucial.
3. Completing the Application- Completing the application is usually done online. Delivering the business details, ID, and business activity is done during this stage.
4. ID Verification- The KYC process is crucial; therefore, to prevent fraud, banks must confirm your identity. The process includes uploading ID documents, business papers, and, usually, a video call to verify the ID.

The last step is quite simple: add money in your main currency and see that the account lets you convert it to other currencies; thus, accessing your digital multi-currency account becomes easier than ever.

Are There Fees Associated with Using a Multi-Currency Account for Supplier Payments?

Multi-currency accounts are known for their specialty of saving money. But one must know that they come with certain fees. 

Here is a list of fees that are associated with multi-currency accounts.

• Account Setup Fee- Platforms may charge money to open the multi-currency account or to hold it. But it is important to note that many fintechs skip this fee, or they do not charge a lot.
• Currency Conversion Fee- Exchanging currencies is charged. But one must keep in mind that fintech platforms often offer real exchange rates while banks add a bigger margin.
• Transfer Fees- Sending money, depending on the platform, may include a transfer fee.
• Inactivity- Businesses must check beforehand if there is an inactivity fee. Although they are not really common, it might be upsetting to face penalties when one doesn’t use an account regularly.

Although the fees associated with the account seem like too much at first, having a multi-currency account for online sellers still helps save money. 

The reason for that is that it offers lower exchange rates, no intermediary bank charges, and faster payments. 

The Kingdom Bank offers its customers advantageous and competitive fees. To learn all about our policy and generate an account, visit our website now!

How Does Currency Conversion Work in a Multi-Currency Account When Paying Suppliers?

One can assert with confidence that having a multi-currency account makes the conversion process seamless. The transaction process differs depending on whether one has the supplier’s currency or not.

Multi-currency accounts let businesses keep balances in different currencies like USD, EUR, GBP, etc. If the business already has the currency of the supplier, conversion does not happen, and payment is made directly.

But if the supplier’s currency is not held, the account converts to said currency automatically before the payment is made. 

The Kingdom Bank, with its strong policies, offers its customers low exchange rates. To access the best multi-currency account for individuals and companies, visit our website!

Can You Schedule Regular Payments to International Suppliers Using a Multi-Currency Account?

Yes, especially fintech ones let businesses set up recurring payments. Businesses choose the supplier, the currency, the amount of money, and the frequency. After that, the multi-currency account with a debit card automatically makes the payment.

Undoubtedly, automation decreases the risk of forgetting a payment, thus improving the relationship with the supplier. 

But before the automation process, businesses must make sure they hold enough money in the right currency. Also, keep in mind that scheduled payments might cost extra. 

With years of experience and expertise, The Kingdom Bank offers its customers all of the benefits of a multi-currency account. 

Whether the account is a multi-currency account for travel, business, or work, we offer the most advantageous routes. To easily become a customer, visit our website now!

What Currencies Are Supported for Paying International Suppliers via a Multi-Currency Account?

Although having a multi-currency account for businesses is a must, the supported currencies of the said account also matter. 

Choosing the wrong account for a business may mean costly extra conversion fees that may add up quickly, causing the business to lose its profits.

Major currencies are almost always supported. These include USD, EUR, GBP, AUD, JPY, CAD, and CHF. Emerging market currencies are also supported by many accounts, but with higher fees. These include CNY, BRL, INR, and MXN.  Minor currencies, however, may need conversion to a different currency before sending.

But one must keep in mind that, depending on the platform one chooses, the number of supported currencies may change. 

Also, before applying for an account, businesses must check if both holding and sending the said currency is allowed.

Knowing the supported currencies before applying for a multi-currency account is of great importance since it helps businesses to avoid unnecessary costs. To learn all about our policy on currencies, visit our website at The Kingdom Bank. 

How Secure Is Making Supplier Payments Through a Multi-Currency Account?

Making international supplier payments means that the transaction involves sensitive data that needs to be protected. Luckily, security and the safety of the said data are a top priority for a multi-currency business account. 

Here’s how:

• Protection offered by the bank- With the advancement in technology, protecting sensitive data has never been easier. Banks offer encryption, multi-factor authentication (MFA), and fraud monitoring.
• Protection offered by the regulations- Opening a multi-currency account means having an account that is licensed under the financial authorities. These financial institutions may be FCA, MAS, or a local central bank.
• Protection offered by the payment network- The usage of regulated rails to make transactions is another way to achieve security. Usage of SWIFT, SEPA, or any other usage of regulated rails means putting another layer of security on the transaction.

It is also important to mention that some security measures must be taken by the user. Approval of workflows, putting transaction limits, and notifications are only some of the examples. 

There are also risk factors regarding the matter of security. 

Using weak passwords for the digital multi-currency account or using unregulated providers must be avoided. It is safe to say that the security features of the multi-currency account are strong, but choosing a trusted and regular provider like The Kingdom Bank is crucial.

What Are the Benefits of Using a Multi-Currency Account Over Traditional Bank Transfers?

Traditional banking methods offer high FX fees, slower processing, and limited currencies compared to multi-currency accounts. 

Here’s how:

1. Lower FX costs- Repeatedly paying for conversion fees may be costly for businesses. However, multi-currency accounts allow users to hold and send balances specific to that currency, thus helping customers avoid recurrent conversion fees.
2. Faster transactions- Using only SWIFT makes the transaction process slower. Many providers, however, use local payment rails, thus making sure that the transaction is faster.
3. Numerous supported currencies- Traditional banking does not support many currencies.  But since multi-currency accounts allow this, dealing with suppliers from different jurisdictions becomes easier.
4. Easier to track funds- Since only one account holds the currencies, bookkeeping and accounting become easier, thus relieving financial teams of recurring manual work.

One can confidently assert that the benefits of a multi-currency account definitely outweigh those of traditional banks. 

To access the best multi-currency account for individuals and companies, visit our website and generate an account right now!

Can Small Businesses Use Multi-Currency Accounts for Supplier Payments?

Although there is a common belief that states that multi-currency accounts are only for global companies, the situation is actually the opposite. 

One can even confidently assert that most fintech providers target small businesses. Having a multi-currency account for online sellers or small businesses may be very advantageous. 

Here’s how:

• Accessibility- Since online sign-ups are allowed, there is no need for a corporate banking exchange. Also, multi-currency accounts offer very low balance requirements, thus making it an ideal choice for small businesses.
• Cost savings- Traditional banking systems charge high FX rates. Multi-currency accounts, however, offer lower rates. This way, newly established or small businesses save money, which is crucial, especially when margins are tight.
• Scalability- Even if a business is small, expanding globally becomes easier if one has a multi-currency account. Since it supports many currencies, opening up to new markets becomes easier for newly established or small businesses.

In summary, it is safe to say that multi-currency accounts are not just for big corporations but also for small businesses. 

Since small businesses that adopted the multi-currency accounts are increasing in numbers, one may wonder about the subject of exchange rate fluctuations.

How Does a Multi-Currency Account Help Manage Exchange Rate Fluctuations?

Exchange rates are always moving, sometimes daily, sometimes within minutes. International transactions, therefore, can be affected quite quickly.

And since traditional banking makes conversions during the payment transactions, it costs more than it should. 

That is where having a multi-currency account comes in handy. 

Here’s how:

• Holding funds in multiple currencies is allowed- Companies can store the funds in the same currency they received them. Since holding and sending in multiple currencies is allowed, paying conversion fees every time is avoided, thus fluctuations do not affect the customer.
• Timing the conversions is an option- Real-time FX rates may cause companies to pay extra. But instead of this, businesses are allowed to choose when to convert, thus causing rate fluctuations to be deemed unimportant.
• Predictability becomes the norm- Holding funds in the supplier’s currency is possible. This situation allows customers not to be surprised by sudden FX changes.

So in summary, one can confidently assert that multi-currency accounts allow companies to manage rate fluctuations easily.

The Kingdom Bank offers its customers a route that is not affected by sudden rate fluctuations. 

To learn how to open a multi-currency account and easily access the multi-currency account with a debit card, visit our website now!

About The Author

The Kingdom Bank Finance Team

This article was prepared by the finance team of The Kingdom Bank. Our team has deep expertise in global banking, fintech, digital assets, and offshore banking, and closely monitors developments in investment, digital finance, and international markets, providing our readers with reliable and strategic analysis.

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