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How do you fix currency conversion issues in scaling up? (10)

03-13-2019 03:54 PM #1 gritaction (Member)
How do you fix currency conversion issues in scaling up?

hello, trust not all STMers here are from the US, as such, if you spend money on ads platform, they mainly charge you in USD ( say for native ads for example )

the bank is forcing the settlement of the credit card bills using local currencies even the transaction is in USD. and the payout from affiliate network is in USD again. quite a portion of money is wasted in the currency conversion

what sort of method you guys do to tackle this?

thanks!

John

03-13-2019 04:25 PM #2 sushiparlour (Member)

I recently looked into this as well. So from my own research the conclusion for a small to medium affiliate was that it was generally best to keep your money in a close loop in the cheapest thrid party service that your traffic source can accept money from and your aff network can pay out of e.g. Paxum, ePayment... As the administrative fee is usually relatively cheaper (than say Paypal) and the money would reach the traffic source quicker as well and you won't have to keep converting it back to your own local currency. Since regardless of how credit card points work the rebate was never really enough to justify the rate you pay. However you would have to pay the initail deposit fee and a withdrawal fee whenever you needed the $$ but the fee is usually a fixed cost so if you are not cash constraint you can just process it in batches.

Also for cheaper wiring of money you can use services like Transferwise which I've found generally is more competitive than banks if you're doing a wire transaction from your local currency to a USD bank account. if your jurisdiction has these new virtual banks, it might also makes sense to look into as they generally offer cheaper cross border movement of money.

If you are larger there are definitly better and more creative ways to move money cross border but this in itself can be a huge topic in itself.

03-13-2019 09:30 PM #3 matuloo (Legendary Moderator)

Can't you just open an account in $? That's what I'm using for years, I have two main accounts, one in EUR one in USD and I use them as needed ... so usd account for USD transactions and eur account for EUR transactions.

Services such as paxum that sushiparlour suggested can help a lot too.

03-14-2019 01:09 AM #4 gritaction (Member)

Quote Originally Posted by matuloo View Post
Can't you just open an account in $? That's what I'm using for years, I have two main accounts, one in EUR one in USD and I use them as needed ... so usd account for USD transactions and eur account for EUR transactions.

Services such as paxum that sushiparlour suggested can help a lot too.
Thanks Matej as always.

Yes, already have USD account in place, however, the payment to ad platform mainly in credit card payment, not all of them allow wiring of funds in bank transfer.

Quote Originally Posted by sushiparlour View Post
I recently looked into this as well. So from my own research the conclusion for a small to medium affiliate was that it was generally best to keep your money in a close loop in the cheapest thrid party service that your traffic source can accept money from and your aff network can pay out of e.g. Paxum, ePayment... As the administrative fee is usually relatively cheaper (than say Paypal) and the money would reach the traffic source quicker as well and you won't have to keep converting it back to your own local currency. Since regardless of how credit card points work the rebate was never really enough to justify the rate you pay. However you would have to pay the initail deposit fee and a withdrawal fee whenever you needed the $$ but the fee is usually a fixed cost so if you are not cash constraint you can just process it in batches.

Also for cheaper wiring of money you can use services like Transferwise which I've found generally is more competitive than banks if you're doing a wire transaction from your local currency to a USD bank account. if your jurisdiction has these new virtual banks, it might also makes sense to look into as they generally offer cheaper cross border movement of money.

If you are larger there are definitly better and more creative ways to move money cross border but this in itself can be a huge topic in itself.
Thanks for the detailed reply sushiparlour, didnt know that you can send money from aff network to traffic source directly. Just wonder how they recognise who the payment from if its sent from third party.

Will definitely look at Paxum

Virtual bank could be the method in the long run

03-14-2019 02:29 PM #5 matuloo (Legendary Moderator)

Yes, already have USD account in place, however, the payment to ad platform mainly in credit card payment, not all of them allow wiring of funds in bank transfer.
I have a card for the USD account too, it's a debit card though, maybe you could get one too... ask your bank

03-20-2019 02:20 PM #6 osmiumman (Member)

Yes, had the same issue here.

I just opened a USD account at my bank and got a Mastercard in USD (there was not much choice for CC in USD in my country). It has some drawbacks (high yearly costs, no loyalty points, have to pay the CC bill by wire (no auto-payment by linking to bank account)).
But it saves a lot of money on FX conversions. I only pay FX conversion on profit (revenues - costs) instead of paying it on revenues + costs. For cashing out the profits (USD to local currency) I use a local FX service, maybe Transferwise would be a little bit cheaper.

03-20-2019 11:45 PM #7 gritaction (Member)

Quote Originally Posted by osmiumman View Post
Yes, had the same issue here.

I just opened a USD account at my bank and got a Mastercard in USD (there was not much choice for CC in USD in my country). It has some drawbacks (high yearly costs, no loyalty points, have to pay the CC bill by wire (no auto-payment by linking to bank account)).
But it saves a lot of money on FX conversions. I only pay FX conversion on profit (revenues - costs) instead of paying it on revenues + costs. For cashing out the profits (USD to local currency) I use a local FX service, maybe Transferwise would be a little bit cheaper.
In my country, there’s no USD based CC. Except you have over around USD5m per year revenue and to request a bank facility under USD credit card.

I have heard a lot about the good thing in transferwise. Will definitely have a look.

03-21-2019 12:57 AM #8 maynzie (Moderator)

Same setup as Matuloo, USD/Euro accounts and wire when can for sure. Those nasty %'s add up to a lot over time and its best to fix it up in the beginning, which country do you live in man?

10-17-2019 03:35 PM #9 fallonp (Member)

Try https://transferwise.com/ , I've found them to be excellent

USD debit card & business account, minimal costs to xfer funds to & from the account & it takes a few seconds, great app to manage everything

10-18-2019 01:56 AM #10 maynzie (Moderator)

& it takes a few seconds
We moved to transferwise as well, it sure is lightning fast. Europe to Australia first time transfer was overnight even after bank hours lol
- and so easy to convert and save on fee$

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