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For any business with a global customer base, particularly international retailers and hospitality companies, MCP is an easy way to boost customer satisfaction right at the start of the customer journey.
It creates a more transparent, frictionless shopping experience, reducing cart abandonments and boosting revenue in return.
What is Multi Currency Pricing (MCP)?
Multi Currency Pricing (MCP) is a tool offered by payment service providers that allows online shoppers to browse and pay for goods and services in their preferred currency.
It enables merchants to offer a wide range of currency options and display localised prices for each customer based on their specific location. It ensures that the entire shopping experience—from browsing through to checkout—is conducted in the customer’s preferred currency.
How does MCP work?
Designed for “cardholder not present” environments—primarily for online shoppers—Multi Currency Pricing is a payment tool that allows customers to view prices in their preferred currency in real-time while actively browsing the products and services on offer.
Unlike standard currency conversion, which doesn’t occur until the end of the payment process, MCP embeds currency conversion into the entire shopping experience.
Here is a step-by-step breakdown of how it works:
Step 1: Customer arrives at the merchant’s website and the currency is determined
In some cases, a customer selects their preferred currency from a dropdown menu of options.
In other cases, GEO IP, country web pages, cookies, or the customer account automatically signals which currency will be displayed on the website.
The latter option is preferable in most situations, as it makes for a more seamless browsing experience.
Step 2: Prices automatically adjust in real-time
After the customer’s preferred currency is determined, prices are displayed in that currency, taking into account foreign exchange rates.
In some cases, prices automatically adjust based on a daily FX rate set by the payment service provider (PSP). In other cases, the merchant fixes customer prices for each currency according to their chosen exchange rate.
Step 3: Customer browses and pays for items in their preferred currency
Throughout their shopping experience, the customer views prices in their local currency. The transaction total at checkout remains in the customer’s local currency as they make their final payment, providing their payment method supports that currency. If it does not, they will be shown that their purchase will be processed in the merchant’s local currency
Step 4: Funds are settled in the merchant’s own currency
At the end of the payment process, funds are settled in the merchant’s base currency. If the merchant has set their own exchange rate to drive the pricing on their site, they take on the risk of any fluctuations in the currency’s value.
If the payment service provider has provided the exchange rate, then most of the time it will be the PSP that absorbs this risk instead.
Benefits of MCP
For businesses that sell online and have, or would like to have, an international customer base, Multi Currency Pricing is a game changer.
It instantly transforms any company into a global brand, while enhancing customer trust and satisfaction along the way.
The benefits of Multi Currency Pricing include:
Smoother, more convenient browsing
First and foremost, Multi Currency Pricing offers convenience.It allows international customers to feel “at home” while shopping and eliminates the need to mentally calculate exchange rates while browsing for goods and services.
Enhanced transparency and trust
Displaying products and services in customers’ local currency offers a more transparent shopping experience, without any unwelcome surprises.Customers can have peace of mind that the displayed price is the price that they’ll pay. This transparency boosts customers’ overall trust in the merchant.
Fewer cart abandonments
When currency conversion happens only at checkout, shoppers are more likely to be surprised by the final total and abandon their cart.MCP gives customers the confidence to follow through with their purchase by displaying clear, transparent pricing in their local currency from the very beginning.
Fewer chargebacks and disputes
Since Multi Currency Pricing allows international shoppers to browse and pay for items in their home currency, there is far less opportunity for confusion and misunderstandings following their purchases.Customers are much less likely to be surprised when looking at their bank statements and take issue with what they’ve been charged. As a result, businesses that offer MCP typically see their chargeback rates go down.
Global reach
When a customer is only presented with prices in a foreign currency, it’s a significant barrier. More often than not, these customers will take their business elsewhere–opting for a company with localised pricing instead.Integrating Multi Currency Pricing into the online shopping experience is essential for any business that aims to attract international customers. Enabling MCP is a quick and easy way to instantly open your business up to the global market.
Enhanced customer loyalty
Multi Currency Pricing plays a major role in ensuring that international shoppers have a positive experience with your brand.These positive experiences lead to repeat business, word-of-mouth referrals, and long-term customer loyalty.
Boosted revenue
When you broaden your reach, reduce the rate of cart abandonments, and create a more seamless shopping experience, revenue goes up.Additionally, some payment service providers pay their clients commissions on MCP transactions. This creates an additional revenue stream and also helps offset the fees involved in accepting cross-border payments.
Settlement in merchant’s own currency
A key benefit of Multi Currency Pricing for merchants is that all payments are settled in their preferred currency, rather than managing multiple foreign currency accounts.This makes it easier to understand sales performance, set sales targets, streamline cash flow, and manage accounts.
What type of businesses need MCP?
The growth of e-commerce has made currency conversion services on cross-border transactions more relevant and in demand than ever.
The rise of omnichannel retailing and digital payments has blurred the line between e-commerce and traditional businesses.
Today, nearly every company, across a range of sectors, operates as an e-commerce business in some capacity.
Even businesses with brick-and-mortar locations often have an e-commerce element and must consider how their online presence should adapt to customers in different geographical locations.
Any business with an international customer base that accepts online payments should consider currency conversion services like Multi Currency Pricing.
However, there are two sectors where adopting this technology is particularly important: retail and hospitality.
1. Retail businesses and Multi Currency Pricing
In the retail sector, the growth of e-commerce isn’t expected to slow down any time soon. In fact, a 2022 report from McKinsey Travel predicts that, by 2027, nearly a quarter of all retail sales will be made online, through e-commerce channels.
Increasingly, a large part of this e-commerce trade in the retail sector comes from cross-border transactions. According to 2023 data from Fidelity Information Services (FIS), 26% of online retail orders placed in the EU are shipped to non-EU customers.
Clearly, today’s consumers are happy to look beyond domestic retailers to find the best products and prices, so long as the experience is convenient and accessible.
By integrating Multi Currency Pricing into their e-commerce platform, retailers are able to:
- offer a seamless online shopping experience to customers from all over the world,
- reduce cart abandonments, chargebacks, and disputes,
- boost SEO performance by ranking higher in localised search results,
- and build their reputation as a global brand.
2. Hospitality businesses and Multi Currency Pricing
The demand for Multi Currency Pricing is even higher for hospitality organisations, as international customers form the foundation of the travel and tourism industry.
Statista sources predict that, by 2027, a whopping 74% of revenue in the tourism sector will be generated online.
Hotels and other hospitality companies that fail to offer currency conversion services to their customers are in danger of being left behind by competitors. In this sector, localised pricing is no longer seen as a value-added service—-it’s now an expectation.
By integrating Multi Currency Pricing into their online sales channels, hospitality companies are able to:
- simplify online booking for international guests,
- enhance the overall guest experience, boosting customer satisfaction and loyalty,
- reduce their reliance on third-party booking sites by making it easier and more convenient to book directly via their website,
- and perform better in local search engine results for guests across the globe.
Integrating MCP into payment platforms
The process for integrating Multi Currency Pricing will vary depending on your payment service provider.
Many only offer Multi Currency Processing solutions, which would allow you to set your own pricing in a limited range of multiple currencies as long as you receive settlement into a specific like-for-like currency account.
However, the most effective approach is to integrate MCP as part of a broader, full-service payment platform rather than embedding it into a fragmented system made up of multiple third-party vendors.
The steps involved in adding MCP to your payment platform are as follows.
- Consult with a payment service provider - First, you’ll meet with a payment service provider that offers Multi Currency Pricing to discuss the logistics and pricing involved in adding this functionality to your payment platform.
- Integrate and customise - Once you’ve signed an agreement with a provider, they will work with your IT team to embed the service across your digital sales channels. You’ll be able to customise the currencies on offer based on your target markets and customer demographics.
- Test - Prior to launching the Multi Currency Pricing feature on your platform, your payment service provider should help you test it in a controlled environment and work out any glitches before you go live.
- Launch and monitor - The final step of the implementation process is to launch MCP and monitor cross-border transactions to ensure everything is working as it should. It’s crucial to work with a payment service provider that you trust will be responsive to any issues that arise and can resolve them promptly.
Planet’s Multi Currency Pricing solution
At Planet, one of our core missions is to give clients the tools they need to take their business global. Multi Currency Pricing is a key tool for expanding into the global market, and then maximising your potential once you get there.
When you choose Planet as your partner for Multi Currency Pricing, you benefit from:
1. Cross-channel integration and support
Planet makes it easy to integrate MCP across all digital channels—websites, mobile apps, and social commerce platforms.
We also offer other currency conversion options for in-person payments, allowing you to cater to international customers at brick-and-mortar locations too.
Our knowledge of consumer habits and our technical expertise allows you to deliver an excellent payment experience at every touchpoint.
2. Less FX risk
With our dynamic MCP service, we set the daily FX rate for all currencies, taking on the risk of any currency fluctuations so that you don’t have to.
We guarantee these FX rates from the moment of authorisation through capture and settlement, ensuring rate stability for up to four or more days.
This means that your customers can benefit from localised pricing while your business remains protected against unpredictable variability in the value of different currencies, especially, for example, between once the order is placed and it has been shipped.
3. Customisation and flexibility
With Planet’s Multi Currency Pricing solution, you can enable as many as 135+ currencies on your e-commerce platforms.
You’re welcome to offer them all or target specific regions by enabling only the most relevant currencies, such as USD, GBP, or EUR.
4. Extra revenue from commission on MCP
With Planet, your business will earn a commission from the currency conversion on every transaction that your customers make with MCP.
When customers pay in their preferred currency, a small markup is applied to the exchange rate and a portion of that markup is shared with your business as a commission.
This creates an extra revenue stream that also helps offset the cost of accepting global payments from overseas customers.
5. A single, end-to-end payment platform
Multi Currency Pricing is just one tool within our fully-integrated payment service that consolidates all aspects of payment processing into one, easy-to-use platform.
Using a single, end-to-end platform simplifies your operations, streamlines accounting, and creates a frictionless payment experience for your customers.
We make it easy for our clients to experience the benefits of Multi Currency Pricing, with simple integration, over 135 currencies offered, a generous commission model, and risk-free settlement in their own currency - even on refunds.
