Multicurrency accounts have become an indispensable resource for businesses that operate on a global scale. These specialised accounts, which simplify international transactions, are a key tool for companies that want to expand beyond domestic markets. The global mobile payment market reached a size of $88.5 billion in 2024, which highlights the major shift toward digital platforms that often involve multicurrency transactions. Whether your business is a digital startup looking to accept payments from different countries or an established corporation investing overseas, a multicurrency account can give you the operational flexibility that traditional banking arrangements often lack.

The advent of digital banking and fintech has accelerated the adoption of multicurrency accounts, many of which offer features that go beyond the basic functionality of holding multiple currencies – such as real-time exchange rate updates and lower foreign transaction fees. These accounts have evolved to become an important solution for businesses with diverse currency needs.

Below, we'll explain the key features of multicurrency accounts, as well as their uses, benefits and challenges.

What's in this article?

• What are multicurrency accounts?
  
• What are multicurrency accounts used for?
  
• Benefits of multicurrency accounts
  
• Challenges of multicurrency accounts
  
• How Stripe supports multicurrency accounts
  

What are multicurrency accounts?

Multicurrency accounts are specialised bank accounts that businesses can use to hold, manage and transact in multiple currencies. Unlike a standard bank account, which is typically denominated in a single currency, a multicurrency account offers the account holder the flexibility to work with different currencies without needing to convert funds.

Multicurrency accounts vs. foreign currency accounts

Multicurrency accounts and foreign currency accounts both allow you to hold and manage funds other than your domestic currency. The difference between them is that multicurrency accounts hold multiple currencies in a single account, while foreign currency accounts only hold a single currency.

What are multicurrency accounts used for?

Multicurrency accounts are used for handling transactions in different currencies without the need for frequent conversions. These accounts serve several practical purposes for different groups:

For businesses with global operations

• Cost efficiency
  Businesses that deal in multiple currencies often incur costs in the form of currency exchange rates and fees. A multicurrency account allows for direct transactions in the required currency, mitigating many of these costs.

• Payment flexibility
  With a multicurrency account, businesses can pay suppliers, vendors, and employees in the currency the recipient prefers. This makes payments more convenient and can improve supplier relationships.

• Risk management
  Currency volatility is a common concern for businesses that operate internationally. Holding multiple currencies in a single account allows businesses to protect themselves against unfavourable shifts in currency values.

• Revenue streamlining
  For businesses that generate revenue and receive payments in different currencies, multicurrency accounts simplify the reconciliation process. Businesses can hold revenues in the currency in which they are received until it's beneficial to convert them.

For frequent travellers

• Expense management
  Individuals who travel frequently can benefit from having an account that allows them to transact in multiple currencies, bypassing the fees tied to currency conversion at international points of sale.

• Investment opportunities
  Multicurrency accounts offer a convenient way to manage assets in different currencies without needing to open accounts at multiple financial institutions. They can be especially helpful for investors who want to diversify portfolios internationally.

For specialised use cases

• Property ownership
  People who own property in different countries can manage their finances more easily with a multicurrency account. These accounts can address a range of issues, from receiving rent payments to handling maintenance fees in different currencies.

• Foreign tuition payments
  Parents who send their children abroad for school can use multicurrency accounts to pay tuition and other fees in the currency of the host country.

Currencies frequently held in multicurrency accounts include pound sterling (GBP), the Japanese yen (JPY), the Canadian dollar (CAD), the Australian dollar (AUD), the Hong Kong dollar (HKD), the New Zealand dollar (NZD) and the Singapore dollar (SGD).

Benefits of multicurrency accounts

Multicurrency accounts offer many advantages that can simplify global financial transactions for businesses and individuals. These benefits include:

Cost-effectiveness

• Reduced conversion costs
  Transacting directly in the desired currency can minimise, and in some cases eliminate, conversion fees. Over time, these savings can make a big impact on your bottom line.

• Transparent fees
  Often, the account structure comes with a transparent fee schedule for transactions in different currencies, which provides predictability in cost management.

Operational flexibility

• Speed and timing
  Quick and easy access to multiple currencies allows businesses and individuals to make timely payments and investments. For example, if a business needs to pay an invoice from an overseas supplier immediately, a multicurrency account provides them with the ability to act fast.

• Localised payments
  Making payments in a local currency can sometimes lead to better terms and strengthen relationships with suppliers and partners.

Risk mitigation

• Currency fluctuation
  Because these accounts let you hold different currencies, you can act when foreign exchange rates are favourable. This can be an effective way to offset the risks associated with currency volatility.

• Liquidity
  Holding funds in multiple currencies increases financial liquidity and allows you to move assets more freely, without the frustrations of conversion lag times.

Convenience and accessibility

• One-stop management
  Multicurrency accounts consolidate your currency needs into a single platform, making it easier to manage and oversee your assets.

• Digital access
  Like most bank accounts, multicurrency accounts offer online and mobile banking features, which provide real-time account management. You can shift funds, pay invoices or check balances at your convenience.

Specialised needs

• Global investments
  These accounts make it easier to invest in foreign markets. They allow you to transfer funds directly in the required currency, bypassing conversion delays and fees.

• International living expenses
  Multicurrency accounts can simplify money management for people who live in one country but have financial obligations in another (due to property management or family responsibilities, for example).

• Education expenses
  For the parents of children studying abroad, these accounts facilitate the direct payment of fees, living expenses and allowances in the currency of the country where the educational institution is located.

Multicurrency accounts are an efficient, agile and cost-effective way to handle global transactions. They cater to a broad range of needs, from business operations to personal financial management, and they provide a versatile financial resource.

Challenges of multicurrency accounts

While multicurrency accounts come with many benefits, they also have certain challenges. Below are some key considerations.

Complexity in management

• Rate monitoring
  Keeping track of fluctuating exchange rates for multiple currencies can be time-consuming. Customers must monitor these rates closely to make educated financial decisions.

• Regulatory compliance
  Operating in multiple currencies usually means adhering to different sets of financial regulations. These can include tax implications, Anti-Money Laundering rules and reporting obligations. Adhering to all of these regulations can make recordkeeping and legal compliance more difficult.

Costs and fees

• Variable fees
  While some multicurrency accounts promise low or zero fees for currency conversion, others have substantial charges for account maintenance, ATM withdrawals or international electronic transfers.

• Interest rates
  Generally, these accounts do not provide attractive interest rates on deposits. Customers might find that the cost of maintaining multiple currency balances outweighs any income from interest.

Risk factors

• Exchange rate risks
  The convenience of holding multiple currencies comes with inherent volatility. Balances in one currency could lose value against another, affecting the account's overall worth.

• Account limits
  In some cases, multicurrency accounts have restrictions that might not apply for single-currency options. These may include transaction limits or maximum balance caps for particular currencies, which can impact financial planning and liquidity.

Accessibility and availability

• Banking services
  The range of services these accounts provide can vary substantially between financial institutions. Some accounts might not offer all the features you need, such as subaccounts or real-time transfers between currencies.

• Geographic restrictions
  Some banks only offer multicurrency accounts to residents of specific countries or regions.

Integration concerns

• Account syncing
  There is no guarantee that a multicurrency account will integrate fully with the financial software that a business uses for bookkeeping or expense tracking.

• Transaction timing
  Transferring funds between different currency balances is not always instantaneous. Time lags could be detrimental to account holders, especially in volatile markets.

Multicurrency accounts present undeniable advantages for managing finances across borders, but they come with potential downsides. Customers must weigh these challenges against the benefits to determine if a multicurrency account is right for them.

How Stripe supports multicurrency accounts

Here are some of the features that Stripe offers to handle multicurrency accounts:

• Automatic currency conversion
  Stripe allows your business to charge customers in their preferred currency while receiving funds in the currency of your choice. The conversion happens automatically, alleviating the need for manual calculations or conversions. This feature is particularly helpful if your business has a diverse customer base spread across different countries.

• Localised pricing
  Businesses can use Stripe to present pricing in a localised manner. This can mean tailoring the prices to market conditions in different countries or presenting prices in the local currency. This feature increases the likelihood of successful transactions and helps improve the customer experience.

• Broad range of supported currencies
  Stripe supports processing payments in 135+ currencies, which allows businesses to operate in multiple markets without the need for separate accounts or complicated financial setups.

• Dynamic reporting
  Stripe's detailed reporting features offer businesses an accurate and real-time view of their finances, which is especially helpful for businesses that operate in multiple currencies. Businesses can apply filters to view transactions by currency type, which can help with financial decision-making.

• Integrated currency balances
  Stripe allows businesses to maintain balances in multiple currencies and pay out in the currency that works for them. This feature offers businesses greater flexibility when working with overseas suppliers or international team members.

• Currency-specific routing rules
  Stripe's advanced APIs offer the ability to route incoming payments to specific currency accounts automatically. This helps businesses that prefer to maintain currency-specific ledgers or need to comply with regional regulations.

• Developer-focused tools
  Stripe's API allows businesses to customise to suit their needs. The API accommodates multicurrency transactions, enabling businesses to build custom solutions that easily integrate with their existing financial systems.

• Payment methods
  Stripe supports multiple currencies and accommodates a variety of payment methods that are popular in different countries, such as Alipay in China and SEPA Direct Debit in Europe. Providing customers with familiar payment methods can boost sales and offer a better customer experience.

• Built-in compliance
  Stripe helps businesses adhere to global tax and compliance rules by calculating and adding necessary taxes automatically during the checkout process. This helps businesses to meet compliance goals without extra legal or accounting overheads.

Stripe's multicurrency features offer businesses the flexibility, convenience and compliance they need to operate successfully on a global scale. While these features solve many problems inherent in international trade, they are most effective when used as part of a comprehensive financial strategy.