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Why should expenses be paid in a local currency?
When a traveller comes to make a purchase abroad, they’re usually faced with a choice – pay in local currency or convert the cost to their domestic account currency.
For some travellers this question can cause confusion. “What exactly is the difference between the two? Does it matter which I pick? How much will I be charged? Is this included in my travel policy?”
Whilst converting costs to domestic account currency can be tempting for travellers looking for clarity on how much they’re paying, doing so often comes at an extra cost. By converting currency at the point of purchase, travellers unwittingly leave themselves at the mercy of retailer or payment processor exchange rates.
These exchange rates are often much less favourable than those offered by credit cards providers, with additional fees or mark-up added in. As travellers pay for lunch, dinners, and taxis throughout their trip the cost of this conversion quickly adds up.
Paying in local currency is a simple solution. Instead of being exposed to unpredictable retailer exchange rates, currency is converted at the exchange rate set by the card issuer, which is typically lower and more transparent.
This does not mean all fees are avoided though. Many card issuers will charge a foreign transaction fee for purchases made abroad. So, companies looking to take their regional expense management one step further may consider using a centralised banking network.
Accessing banks across the world
Conferma’s virtual payments solution allows you to access all your banking partners in one central platform. We’re connected to over 80 card issuers around the world and all major card schemes, meaning that you can deploy virtual cards directly to your travellers through in-region banks. They can they add the card to their smartphone’s digital wallet and seamlessly pay on-the-go in the local currency.
As your business grows, as an existing virtual card customer, you can leverage the same platform to onboard new card accounts with new banking partners around the world.
For your travellers, virtual cards also offer many benefits as a flexible, intuitive solution. Using a mobile app, travellers can request cards when needed, immediately upload spend receipts, and see accessible summaries of total spend.
Integrated virtual cards and banking partners with Conferma
Conferma’s virtual card platform makes managing your travel expenses simple. As well as banking partners, Conferma can connect to your TMC and expense management platform to provide an end-to-end corporate travel solution.
We’re connected with hundreds of Travel Management companies, more than 175 online booking platforms, over 80 card issuers, and all of the major cards schemes and GDSs, so you can centralise spend using your TMC, paying with your bank, and booking with your technology.
Get in touch with our virtual card specialists today to learn how our platform can centralise and simplify your travel expenses.