Becoming a Forex Merchant
Becoming an fx merchant allows you to receive payments through credit or debit cards. It would be best if you obeyed all the regulations established by card associations. Specific requirements need to be met to become a Forex merchant. If you are from Europe, you must have a business presence in Europe and be a regulated foreign exchange. You should present your revenue earnings with 4 to 6 months of processing history and a low overall chargeback rate to the bank you’ll be working with your FX payment service providers.
You could equip your checkout process with 2-step authentication such as 3-D Secure that serves as an additional layer to payment security. Take care to find a conversion-friendly version of these 2-step authorization mechanisms.
Fraud and chargebacks are a common problem in the Fx industry, causing a nuisance to highly profitable sectors. With these increasing frauds, you may become a liability to the banks, and they may get reluctant to work with you. So it becomes essential to effectively eliminate these revenue-jeopardizing issues and choose the best fx payment service providers available.
Points to Choose to Become an FX Payment Service Provider
There are over 50 service providers in the European market, and hence choosing the right one can be tricky. As a business, it is necessary to select the best provider to look after your foreign currency and international payments as they will handle vast sums of your company’s money.
Key Points To Know While Choosing
- Check the security of your service provider:
It is essential to check that the FX service provider is authorized for safety purposes. It must be regulated by the FCA (Financial Conduct Authority) for the provision of payment services. Take care that your company’s funds are being earmarked as your own appropriately and on your financial statements.
2. Look into their international payment capability:
Not all of the service providers can send payments to third-party apps through FX payment service providers. To have this option, you have to work with a provider who can facilitate currency exchange and send funds on your behalf. Only a few service providers send funds to all of the destinations in all currencies. If your business or company wants to makes payments to destinations all over the world and in emerging market currencies, check that your service provider can do this. Some service providers have a speciality to handle a specific money.
3. Research around international payment FX rates:
Closely look at the transaction fees and exchange rate of the fx system.
- Transaction fees:
Many of the international providers charge a transaction fee to make an international payment. Always be aware of the pricing models as they may bury the cost in the FX spread.
- Exchange rate:
Go for the FX payment service providers that provide you a fair exchange rate based on your requirements. Looking for a cheap provider may not be the best choice always.
4. Be aware of global payment technology:
With an increase in international businesses, more startup businesses are emerging, and they are in need of making international payments online. If your company has regular payment transactions, you should consider the service provider that has a platform integrated with your in-house system. This helps you as it features file upload capability that allows you seamlessly import payments files from your ERP or accounting system. This also helps to reduce the need for manual payment entry and therefore leads to fewer errors.
5. Check the FX product portfolio:
Every provider offers different types of FX products. If your company has a broad FX portfolio, it helps you to develop a robust hedging strategy. It also provides more exposure to the currency that can help your business.
Points to Look While Managing Online Payments
- Use secure and authorized login that will protect you from fraud.
- Report the functionality, so you can quickly get an audit trail.
- Keep track of the live FX rates to keep sure of the exchange rate.
- Always store all the beneficiary details online ad never share it with anyone.
- Turn on the email notification, so you and your company get notified about the transactions you’ve made.
There are lots of limits to consider while looking for the best fx payment service providers. You will get various calls from different international companies regularly that will try to convince you to choose their service. It is advisable to carry out due diligence while selecting the best service provider for you.