Like-for-like settlements can help your business navigate the challenges of international payment processing, including avoiding fees, reducing risk and managing currency fluctuations. However, to enjoy these benefits, it’s crucial to set things up seamlessly.
This article will explain everything you need to know about like-for-like settlements, and how you can use Checkout.com to leverage this system.
Like-for-like settlement means settling payments in the same currency that was used for the original transaction. So, if a customer buys something in their own local currency, the merchant gets paid in that exact currency. This way, there's no need for currency conversion and any extra fees that come with it.
Below, we’ve broken down the simple steps for implementing like-for-like settlements…
If you want lower costs associated with your cross-border payments, it's important to choose a reliable payment processor with a strong global network, such as Checkout.com. This first step is really important because it can greatly affect your sales results.
After you've picked the right payment service provider, set up your merchant account and adjust it for like-for-like settlement.
Setting up a local legal entity is crucial for following local rules, accessing essential resources, and handling taxes properly. It also boosts your credibility and allows you to tap into local expertise when dealing with different markets, partners, and stakeholders.
We recommend getting advice from experts well-versed in local regulations, which can help you establish the right tax structure. This ensures your business meets requirements for Corporate Tax returns and duties down the line.
Tailoring your payment system depends on your unique requirements. Usually, this means arranging payment gateways, terminals, and related software that work well together, which can help your business securely handle like-for-like settlements.
Provide your team with clear instructions to become completely familiar with like-for-like settlements – teach them how to handle customer questions and transactions in various currencies smoothly.
This thorough training not only readies them for important situations, but also boosts their confidence in providing top-notch service. After all, happier customers should bring you closer to success.
It's important to keep track of your transactions and settlements for a successful process. Regularly reviewing them can help spot any potential problems that may come up, so stay vigilant in monitoring to prevent any hiccups in the overall operation.
These are the biggest advantages of like-for-like settlements for merchants…
For smooth like-for-like settlements, you should follow these steps:
When it comes to like-for-like settlements, it's important to be aware of – and comply with – the specific rules and regulations in each country. Each nation has its own policies regarding foreign currency and transactions, so understanding these regulations is crucial for operators to avoid potential legal issues.
Here are some of the most important considerations…
For instance, many jurisdictions have stringent AML and KYC regulations in place to prevent illicit financial activities, which may require your business to verify the identities of customers and maintain detailed transaction records.
Some countries also have strict controls over the conversion of local currency into foreign currency and vice versa. It's crucial to be aware of these controls to ensure compliance.
Ready to reap the rewards of like-for-like settlements? Get started quickly and easily with Checkout.com. With our international payment processing, you can settle over 20 currencies and save significant revenue by avoiding conversion fees.
That means you can avoid fees, reduce risk and remain compliant – all within one simple tool. Contact our sales team for more information on how like-for-like settlements can help your business.