Embracing multi-currency acccounts for global sales this festive season
The holiday season is fast approaching, and for South African businesses, it's not just a time for celebration, but also a fantastic opportunity to expand their customer base and sales on a global scale. With the world becoming increasingly connected, businesses can now reach customers in different corners of the globe. However, to do so, they need to think beyond borders and currencies, and that's where multi-currency accounts come into play.
Multi-currency accounts are important in today's global market as they help South African businesses sell globally and this festive season is the perfect time to explore this opportunity to sell to customers beyond local borders.
Unlocking Global Market Potential
More than half (57%) of South African businesses are looking to expand their reach to international markets this year. With the world becoming more interconnected, the opportunity to tap into global markets has never been better. E-commerce has played a significant role in this shift, allowing businesses to reach customers worldwide. However, dealing with various currencies can be a daunting challenge.
This is where multi-currency accounts shine. These accounts allow businesses to hold and manage multiple currencies within a single account, simplifying the process of receiving payments from customers around the world. It’s no wonder that, in 2022, 63% of South African businesses that adopted multi-currency accounts reported increased international sales.
Mitigating Currency Exchange Risks
The volatile nature of exchange rates can pose a significant risk to businesses engaged in international trade, and currency fluctuations have the potential to affect up to 30% of a business's earnings. Once again, multi-currency accounts are effective as they can hold funds in different currencies, thereby protecting businesses from these risks. The ability to convert funds when exchange rates are favourable can result in up to 25% in increased profits for businesses operating globally.
Enhancing Customer Experience
Providing an exceptional shopping experience for international customers is vital, and the numbers reflect this. Offering prices and accepting payments in the local currencies of international customers can increase conversion rates by up to 30%. Furthermore, it can reduce cart abandonment rates by a significant 25%, ultimately leading to a boost in overall customer satisfaction.
Simplifying Accounting and Reporting
Managing finances across multiple currencies can be a daunting task, especially during tax season. In fact, businesses spend an average of 15% more time on financial administration when dealing with multiple currencies. Multi-currency accounts offer a solution by automatically converting and recording transactions in the preferred accounting currency of the local business, reducing administrative burdens and ensuring tax compliance is more straightforward.
Keeping Transaction Costs Under Control
Traditional banks often charge hefty fees for international transactions, including currency conversion fees. The statistics reveal that businesses can reduce these transaction costs by up to 40% with multi-currency accounts. These accounts typically offer competitive exchange rates and lower fees for cross-border transactions, making global expansion more cost-effective for businesses.
According to Ola Oyetayo, CEO of Verto, “As we approach the festive Christmas season, South African businesses have a unique opportunity to capitalise on the global market. To seize this opportunity and ensure they are ready for international sales, it's crucial that businesses embrace multi-currency accounts to mitigate currency exchange risks, enhance customer experience, simplify accounting, and keep transaction costs under control.”
Businesses would do well not to let borders or currencies limit their growth potential this festive season and beyond. By being prepared to make the most of the holiday season and embracing the power of multi-currency accounts, they will be well-positioned to take their offerings to the global stage.