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Multi Currency Pricing

Multi Currency Pricing (MCP) is a real-time transaction repricing when an overseas customer sees currency presented to him on merchant website is different from his card currency.

For Merchants, MCP helps in providing Localized payment experience which leads towards Higher conversions of overseas customers. For Customers, it helps to understand price of the good better resulting informed buying decision.

From PayU’s perspective, MCP results into an additional revenue due to mark-up margin (typically 4-6% of exchange rate) gets applied while repricing transaction amount from one currency to another. Also it opens up entirely new opportunity to provide SAAS solution to all such retailers where traction for international customers is higher.

1. Product Overview

Multi-Currency Pricing (MCP) allows merchants to price goods / services in a number of foreign currencies while still receiving funds in chosen currency. For customers, it helps to better understand the price of the good in the currency they understand.

Benefits to Merchants –

1. Increased global sales with the convenience of a local acquiring solution.

2. Higher conversions of international customers.

3. Extra revenue for the business without increasing base prices or competitiveness.

4. Enhanced customer loyalty with greater incentive for repeat usage.

Benefits to Customers –

1. Comfort and convenience of paying in the currency which is understood best – a more familiar shopping experience for international customers.

2. Informed buying decisions

3. No surprises in Card statements due to unknown FX charges

How does MCP make difference ?

Without MCP, the transaction will be processed in a currency different from consumer’s card issuing currency. Once transaction is authorized, issuing bank will apply foreign exchange rates and same will be reflected on card statement. Here consumer is totally unaware of what rates are getting applied and what will be the final amount charged to him. Consider case of US based customer trying to pay against indian merchant website –

With MCP, the transaction will be processed in a currency chosen by consumer which is mostly his card currency. Since his issuing bank sees this as a local currency, it can not apply any foreign exchange rates. Also consumer is ensured that same amount will be reflected on his Card statement.

For PayU it is extra revenue (refer amount 13.50 USD) due to amount gained during markup.

3. Product Details & Workflow

MCP Engine –

MCP engine takes care of maintaining latest Foreign Exchange (FX) rates from External services, storing merchant’s MCP configurations and providing API interface to offer MCP / DCC to external clients. High level functions of MCP engine are as follows –

● FX file picker to take latest FX rates from ICICI bank everyday

● Bin Checker to compare merchant’s Base currency and Card issuing currency

● Currency settings to enable different currencies under MCP scheme

● Mark-Up configurations while converting from one currency to another, for currencies enabled under MCP scheme against particular merchant

● Card Scheme support for MCP (Visa and MasterCard only)

● Business model configuration to determine whether offering is Low MSF or Revenue Sharing

● Exposing API to offer MCP/DCC to external clients –

○ Lookup

■ Returns list of currencies, amount, exchange rates and lookup Id in the response if DCC / MCP is applicable for current card

■ For DCC it only returns single currency and amount which is relevant to card currency

■ For MCP, it will return all the currency and amount as MCP doesn’t depend upon card bin

Merchant Panel –

For MCP opted transactions, below are the reporting needs to be provided on PayU panel.

● Unified view of all transactions in a single console irrespective of final currency of the transaction

● Transaction should be shown in original amount and currency even after mcp was opted.

● Details like final amount, final currency and exchange rate needs to be shown on transaction details screen

● Same data should be applicable for downloads in transaction reports

● Settlement data should reflect actual INR settlement done against merchant irrespective of final currency

4. Implementation Outline & Expectations

○ Non-Seamless merchants –

■ MCP will be provided as a Zero integration path where detecting card currency and offering MCP will be handled on checkout page.

■ Merchants will still receive original currency as final response along with extra details

■ Inquiry and Refund will work with both original currency as well as final currencies

■ Transaction panel will show MCP details associated with transactions

○ Seamless merchants –

■ Will be provided additional API to build MCP experience on merchant checkout page

■ Merchants will still receive original currency as final response along with extra details

■ Inquiry and Refund will work with both original currency as well as final currencies

■ Transaction panel will show MCP details associated with transactions