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The benefits of multi-currency accounts for your business

Multi-currency accounts are an alternative to local bank accounts, providing a single account to manage multiple currencies. Let’s look at the major benefits.

Key takeaways

A multi-currency account allows businesses to withdraw, deposit, and hold different currencies
Businesses can benefit from favorable exchange rates and fast cross-border payments
A World Account simplifies payments to suppliers and customers across X+ countries and X+ currencies

Introduction

Cross-border transactions are necessary for businesses expanding operations globally. But high transaction fees and excessive conversion rates can quickly chip away from the already low profit margins.

Multi-currency accounts are an alternative to local bank accounts, providing businesses with a single account to manage multiple currencies and cross-border payments. Whether you want to pay suppliers in China or collect payments from customers based in Asia or Europe, you can do it all through a single multi-currency account.

Let’s discuss the top benefits of using multi-currency accounts for any business.

What is a multi-currency account?

A multi-currency account allows businesses to withdraw, deposit, and hold different currencies under a single account. It is useful for businesses operating globally with a requirement of transacting in different currencies.

You can open up multiple local currency accounts within a multi-currency account, each with a different account number and sort code.

For instance, you could use your CNY account to send payments to your suppliers in China and use the EUR account to collect payments from customers through payment gateways or marketplaces.

You can either hold the funds in your multi-currency account to make further payments or withdraw the funds to your bank account, according to the current conversion rates.

WorldFirst offers multi-currency accounts with forward contracts that allow you to lock in exchange rates for up to 24 months. With a World Account, you don’t have to worry about sudden market fluctuations affecting your profit margins.

Take a look at our complete guide to the best foreign currency accounts in Australia.

Top benefits of multi-currency accounts

End-to-end global cash management

Managing multiple currencies through one account means you can track all your global and local transactions in one place. Business accounting becomes much easier, giving you a transparent view of the cashflow.

Favourable exchange rates

Multi-currency accounts usually offer more competitive exchange rates than standard bank accounts, allowing you to get more value out of them. Unlike traditional bank accounts, you can choose to hold foreign currencies to make future payments or convert them when the exchange rates are favorable.

Avoid double conversion and save on costs

Businesses that constantly deal in multiple currencies through standard bank accounts have to incur costs associated with transaction fees and exchange rates. A multi-currency account allows you to make direct transactions in the currency of your choice, which in turn saves costs.

For instance, if you have received payments from customers in CNY, you can hold the funds in your account and use it to pay your Chinese suppliers. You don’t need to convert the funds from CNY to AUD and later from AUD to CNY.

Take your business global

The biggest advantage of using a multi-currency account is that you can take your business global without the extra local banking paperwork. Suppose you are starting to work with a new supplier or expanding your customer base to a new country. In that case, all you have to do is open a new local currency account within the same multi-currency account and start receiving and sending payments like a local.

Manage risks

Currency volatility is one of the most common concerns for businesses operating globally. By holding multiple currencies in a single account, businesses can hedge against sudden unfavourable currency exchange rate shifts.

Forward contracts in multi-currency accounts can enable businesses to protect themselves against sudden currency market volatility by fixing an exchange rate for a set period of time.

Even if the live market rates move against your expectations, your business will not be negatively affected since you have already hedged a fixed rate. These forward contracts can also give your business a reasonable estimate of profit margins and revenue you can expect in the coming year.

WorldFirst offers multi-currency accounts with forward contracts that allow you to lock in exchange rates for up to 24 months.

No unnecessary bank charges

A multi-currency account saves you on unnecessary bank charges usually levied on every transaction. Few multi-currency accounts like WorldFirst don’t charge anything for account setup, monthly maintenance, or receiving payments.

Who can benefit from a multi-currency account?

Those who might benefit from a multi-currency account include:

Businesses that want to expand their operations and cater to a global audience
Businesses that have an online storefront and accept customers from across the world
Businesses that have product suppliers based in China but struggle to make cost-effective and quick payments

Open a multi-currency account with WorldFirst

WorldFirst simplifies payments to suppliers and customers across 130+ countries and 15+ currencies. You can save on unnecessary transaction fees and sell globally while protecting your profit margins.

Here are the steps to open a multi-currency account with WorldFirst:

Step 1: Sign up

Get started by signing up for a free WorldFirst account.

Step 2: Open local currency accounts

Get your local account details for multiple currencies.

Step 3: Send and receive payments

Use the local currency bank details to send and receive cross-border payments. You can also make free and instant payments from one WorldFirst account to another.

Step 4: Hold or transfer funds

Hold funds in your account or repatriate them to your main bank account at low exchange rates.

Disclaimer: The information contained is general only and largely our views. Before acting on the information you should consider whether it is appropriate for you, in light of your objectives, financial situation or needs. Although information has been obtained from and is based upon multiple sources the author believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions, estimates, mentioned products/services and referenced material constitute the author’s own judgement as of the date of the briefing and are subject to change without notice. WorldFirst shall not be responsible for any losses or damages arising from your reliance of such information.

Open a World Account for free

Open 10+ local currency accounts with local account details
Direct CNH payments to 1688.com
Pay suppliers, partners and staff in 40+ currencies and 130+ destinations
Collect secure payments from 100+ marketplaces and payment gateways, including Amazon, AliExpress, Paypal and Shopify
Lock in currency conversion rates for up to 24 months

Written by Rick Hill, Head of Sales ANZ at WorldFirst

Rick Hill has worked in payments and financial services for the past nine years. He began his career at a large institutional bank and has since worked across startups and scaleups. Over the past four years, his experience with e-commerce retailers has led him to believe that WorldFirst will be crucial in helping brands expand globally by demystifying the complexities of entering new markets.