As you take your business global, the name Shopify comes to everyone’s mind. Among all things required to prepare for a global business, receiving international payments is the most critical part.
Shopify, a business enabler, has an in-built robust system to manage national and international payments. However, Shopify Payments isn’t available in India, which means Indian businesses need to choose another platform to receive cross-border payments.
Let’s find out more about receiving international payments in India using an international payments network.
What are International Payments and Why All the Fuss?
International payments are financial transactions where both entities, receiving and sending the money, are in different countries. For a business owner working from India, China, Singapore, etc., receiving payments from the USA, the UK, Germany, etc. are international payments and vice versa.
For any business aiming to expand its market reach and manage a global supply chain, set up a payment gateway for Shopify. Since the same isn’t available for Indian businesses, the only option left for Indian businesses is to choose another payment option.
There is a bit of fuss around international payments because it often involves the conversion of the payer’s currency to the preferred currency of the receiver. This conversion is one of the reasons why businesses might have reservations about taking their business global.
As the conversion rates vary from country to country, the amount of money businesses receive is different. On these exchange rates, banks and other intermediaries charge a fee, which is legal, but the rates vary from provider to provider.
Since all these variations are involved, receiving international money often becomes a deterrent for small-scale businesses.
How does International Payments Work?
Indian businesses must use either their bank network or third-party payment gateways for cross-border transactions. There are several providers that will help Indian businesses accept and transfer payments abroad but there’s a process behind the curtains. A process underscored by payment processing, currency conversion, and settlement.
- Payment Gateway Integration: After choosing the best payment gateway merchants must integrate into their business. Integrating it through Shopify Admin Panel, this gateway will become the default option to accept international payments.
- Accepting International Payments: Depending on the payment gateways you choose, accept payments paid through debit/credit cards, digital wallets, and ACH. Customers making the payments will see options in their local or selected currency and this makes their checkout experience smoother.
- Payment Processing and Currency Conversion: As the payee reaches checkout, the payment gateway integration secure processes the transaction. International customers pay in foreign currency and here the gateway handles currency conversion based on the existing exchange rate and applies the FX markup before you receive international payments in India. Transactions are processed according to Indian regulations and international payment standards.
- Fraud Management and Compliance: Well reputed international payment providers use built-in security features like AI-based fraud detection, 3D secure authentication, and chargeback management. This protects your business from fraudulent transactions while helping you stay compliant.
How To Get International Payments for Indian Businesses?
Indian businesses need to choose another international payments system that integrates with Shopify. Here;s a quick formula to know which is the best option to receive international payments.
- Multicurrency Support: Choose an international payments solution for your that can accept payments in multiple currencies. This means merchants can accept payments in multiple currencies.
- With an ideal solution, you can also set product prices to display in different currencies according to the country where you are selling the product.
- Ensure the payments you receive in different currencies is settled in your store’s local currency.
- Check the currency conversion fee used by the international payments provider and that it is set according to the rates set by the national-level regulators of your country.
- Tax Calculations: Well-built payments systems have integrated tax calculations feature where the tax payments are automatically calculated according to the product and the country’s regulations. The platform provides clear instructions to your customers about the tax rates and formalities related to each product and how the payments they make will be impacted.
- Zero Additional Transaction Fee: When using the payment gateways for accepting international payments, ensure you don’t have to pay any extra amount or transaction fees.
- Faster Payouts to Businesses: As advertised by third-party payment providers, go for a solution that automates payouts, ensuring every business owner receives the money quickly. Check for the number of days mentioned to receive the payment.
- Built-in Fraud Protection: Advanced payment solutions providers ensure merchants are protected from fraud and scams as the platforms use AI. With fraud protection, you will get chargeback protection, and since the system is compliant with national and international regulations, it ensures that payments are protected.
Costs and Fees to Receive International Payments in India
International payment gateways charge different types of fees for each transaction, depending on the plan they choose;
- Transaction Fee: Usually ranges between 2% to 4% of the transaction amount. However, the exact fee might vary according to the country, card network, and payment method.
- Currency Conversion Fee: FX markup fee, which usually ranges between 1% and 3% is also charged.
- Settlement Charges: Some international payment gateways charge a predetermined fixed fee or minimum to settle cross border payments.
Conclusion
With Shopify as your business partner and an international payments system, international markets aren’t out of reach for Indian businesses anymore. When choosing a payment gateway for Shopify, choose a solution that is fast, secure, and provides the best conversion rates.
However, if you are looking for a better option than Shopify Payments, Cashfree can also help receive and process international payments. Get in touch with the Cashfree team to know more.
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