Handling Multiple Currencies

Merchant acquirers are behind every card payment. But unlike banks or card brands, they get far less visibility. Here's my take on the European landscape. A merchant acquirer enables businesses to accept card payments from customers. They process transactions, settle funds, and handle the connection to card networks. In Europe, acquirers typically operate under one of two PSD2-regulated licenses: • As an authorized payment or e-money institution • As a credit institution (i.e., a bank) 𝗖𝗼𝗺𝗽𝗲𝘁𝗶𝘁𝗶𝗼𝗻 𝗮𝗻𝗮𝗹𝘆𝘀𝗶𝘀: 𝟭.𝗪𝗼𝗿𝗹𝗱𝗽𝗮𝘆 has global scale and strong enterprise and omnichannel capabilities. Privately owned, it's expanding internationally and serving large, complex merchants. Set to be acquired by Global Payments in 2026. 𝟮. 𝗡𝗲𝘅𝗶 is Europe’s top consolidator, integrating major acquisitions (Nets, SIA) while focusing on local expertise and deep bank relationships. 𝟯. 𝗙𝗶𝘀𝗲𝗿𝘃 combines US scale with global reach. It leverages its Clover platform and bank ties to deliver end-to-end commerce solutions. 𝟰. 𝗔𝗱𝘆𝗲𝗻 redefined acquiring with a developer-first, API-native model. Its single tech stack powers global platforms like Uber and Spotify. 𝟱. 𝗕𝗮𝗿𝗰𝗹𝗮𝘆𝘀 uses its universal banking position to support acquiring, cross-selling to merchants and embedding finance across its UK base. 𝟲. 𝗪𝗼𝗿𝗹𝗱𝗹𝗶𝗻𝗲 is Europe-focused, with strength in public sector and regulated verticals. Post-Ingenico, it’s expanding multi-country reach. 𝟳. 𝗚𝗹𝗼𝗯𝗮𝗹 𝗣𝗮𝘆𝗺𝗲𝗻𝘁𝘀 has a strong omnichannel presence, serving enterprises with integrated commerce. Its Worldpay acquisition will make it Europe’s largest acquirer. 𝟴. 𝗝.𝗣. 𝗠𝗼𝗿𝗴𝗮𝗻 𝗣𝗮𝘆𝗺𝗲𝗻𝘁𝘀 is gaining ground as a premium institutional-grade acquirer, embedding acquiring into treasury and cash management services. 𝗧𝗿𝗲𝗻𝗱𝘀: - Shrinking margins: Interchange fee regulation, competitive pricing, and rising compliance costs are putting pressure on profitability. - Alternative rails: Open Banking and A2A payments are maturing fast, promising lower-cost alternatives to cards - especially in e-commerce and bill payments. - Embedded finance: Merchants increasingly expect acquiring to come bundled with value-added services - lending, payouts, loyalty - not just payment processing. - Tech debt: Legacy acquirers face challenges modernizing infrastructure while competing with tech-native players like Adyen or Stripe. - Regulation: PSD3, AML upgrades, and data protection rules are adding pressure, especially on KYC, onboarding, and cross-border flows. - M&A Integration: Several players are still digesting mega-mergers, risking delays in platform unification and operational efficiency. Opinions: my own, Trx. volume source: 2025 Nilson Report 𝐒𝐮𝐛𝐬𝐜𝐫𝐢𝐛𝐞 𝐭𝐨 𝐦𝐲 𝐧𝐞𝐰𝐬𝐥𝐞𝐭𝐭𝐞𝐫: https://lnkd.in/dkqhnxdg

🚨 “It’s just shipping goods internationally.” Said no Trade Compliance professional ever. From the outside, global trade looks simple: 📦 Exports 📦 Imports But beneath the surface? It’s an iceberg. And what people don’t see is where the real work happens. Below the waterline of Global Trade Compliance: ▪️ Regulatory changes that never stop ▪️ Tariff classification challenges ▪️ Sanctions regimes & embargo checks ▪️ Denied party screening ▪️ Origin determination ▪️ Export controls ▪️ Licensing requirements ▪️ Valuation complexity ▪️ Documentation risks ▪️ Record keeping obligations ▪️ Trade agreement analysis ▪️ Import restrictions And that’s just the beginning. One wrong classification. One missed sanctions hit. One incorrect origin declaration. 👉 That’s not a small mistake. That’s financial risk, shipment delays, penalties, or reputational damage. Trade Compliance isn’t a back-office function. It’s a strategic risk management role that protects revenue, reputation, and global growth. The companies that understand this? They don’t see compliance as a cost center. They see it as a competitive advantage. If you’re working in: • Customs • Export Control • International Logistics • Supply Chain • Trade Compliance You know exactly what this iceberg represents. 💬 What’s the ONE “hidden” compliance challenge people underestimate the most? Drop it in the comments — let’s make the invisible visible. And if you believe Trade Compliance deserves more visibility, follow for more insights on Global Trade, Customs & Export Control. ⸻ ( Illustration by Adel Gatri ) #GlobalTrade #TradeCompliance #ExportControl #Customs #SupplyChain #InternationalTrade #RiskManagement #Sanctions #ImportExport #Logistics #ComplianceLeadership

Formulating a Transfer Pricing Policy for GCCs in India - More than just a “cost + markup” exercise A lot of GCCs in India start with a simple assumption: “Let’s go with a cost-plus model and we’re sorted.” In reality, that’s just the starting point. The real backbone of a robust transfer pricing (TP) policy is a well-thought-out FAR analysis (Functions, Assets, Risks). Here’s where many may go wrong 1. One-size-fits-all markup: Not all GCCs are equal. A routine back-office support center ≠ a high-end analytics or R&D hub. The depth of functions and risks should directly influence the markup. 2. Ignoring evolution of the GCC: Today’s captive unit can become tomorrow’s strategic hub. If your FAR profile evolves but your TP policy doesn’t - you’re creating audit exposure. 3. Documentation as an afterthought: TP is not just about arriving at a number. It’s about being able to defend that number - with clarity, consistency, and commercial logic. 4. Policy vs Practice mismatch: If actual conduct deviates from documented policy, authorities will always rely on conduct. What a strong TP policy should ensure: - Alignment with actual business operations - Clear characterization of the GCC (low risk vs value-added) - Defensible benchmarking - Consistency across years and jurisdictions For GCCs in India, TP is not a compliance checkbox - it’s a strategic narrative of value creation within the group. Curious to hear - how are you seeing GCC TP models evolve in your experience? #GCC #Tax #TransferPricing #MNC #InternationalTax

Over the past few weeks, I’ve had conversations with clients across Europe, the Middle East, South America, and Africa (EMESA) who are navigating the new era of #trade policy uncertainty. It’s clear that trade policy is no longer a background factor: It’s center stage—and boardroom critical. And while the headlines might focus on China and the US, the ripple effects are already hitting businesses in our region: from pricing pressures to supply chain reconfigurations. What’s clear: businesses can’t afford to wait and see. - Companies must assess where they’re exposed—product by product, market by market. - They need a “tariff command center”—an agile team that can scenario-plan and act fast. - And above all, they must build geopolitical muscle: the ability to respond strategically to shocks that may not follow past patterns. At Boston Consulting Group (BCG), we’ve been working side-by-side with clients across EMESA to navigate this uncertainty—not with panic, but with clarity and readiness. Our latest article breaks down the EU’s phased approach and how companies can respond: https://lnkd.in/eA7Sf8h2 Here’s my key takeaway for you to keep in mind: #Resilience is no longer a luxury. It’s a necessity.

Let's face it - crafting a robust transfer pricing policy isn't just about saying “limited risk distributor! Operating margin 3%”. It's about building a framework that can withstand scrutiny and adapt to the ever-shifting sands of international tax. Here are 7 key elements: ► Economic substance alignment Your policy should reflect the actual value creation within your group. We need to bridge that gap between legal form and economic reality. This means a deep dive into your value chain, not just superficial breakdowns. ► Flexibility with guardrails The business world moves fast. Your policy needs to be agile enough to accommodate changes, but with clear boundaries. Think of it as a playground - lots of room to play, but with a solid fence to keep things in check. Introduce your business folks to that playground! ► Operational feasibility A policy that looks great on paper but falls apart in practice is worse than useless. Work closely with your finance and operations teams to ensure your policy can be implemented without causing operational headaches. Remember the tale of FairyTale Inc? Don't let that be you. ► Robust benchmarking No vague comparables and unexplained exclusions. Your benchmarking needs to stand up to increased scrutiny. Document your process meticulously, justify your choices, and be prepared to defend them. "Clear explanations for judgments and positions taken" HMRC (c). ► Clear intercompany agreements Your legal framework should mirror your economic substance. Ensure your intercompany agreements clearly outline roles, responsibilities, and risk allocation. These aren't just paperwork - they're your first line of defense in a dispute. ► Profit allocation logic Your profit allocation needs to be more than just a mathematical exercise. It should reflect a clear understanding of where value is created in your business. ► Monitoring and adjustment mechanisms A set-it-and-forget-it approach won't cut it. Build in regular review processes and clear triggers for when adjustments are needed. What other elements do you think are crucial? Have you faced challenges implementing any of these? Let's keep this conversation going - after all, in the world of transfer pricing, standing still is moving backwards.

Most teams think payment tracking is a logging problem. It is a ledger problem. A single cross-border payment typically touches four independent systems. A bank for fiat in, a custody provider for stablecoins, an exchange for FX, and a local bank for payout. None share a transaction ID. None understand the full lifecycle This creates a structural blind spot. At low volume, teams manually reconcile. At scale, this breaks. The US–Mexico corridor alone processes over $5B per month. At 1,000 transactions per day, you are no longer tracking payments. You are running forensic accounting in production  ____ The failure shows up in specific places. -> First, compliance. A payment gets paused mid-flow. You cannot answer whether funds are in custody, in review, or already converted. Each system shows a different state. No system shows the truth. -> Second, failed payouts. A wrong account number leaves funds stranded in local currency. Without per-transaction state tracking, you do not know if the money sits in a bank, an exchange, or a holding account. Support becomes investigation. -> Third, FX leakage. You quote a rate at 16.80. Execution happens at 17.05 or 17.20. Without linking quote and execution per transaction, you cannot measure spread, slippage, or actual revenue. Margin disappears silently. -> Fourth, reconciliation. Bank balances, custody balances, and exchange reports should match. They do not. Teams spend days aligning X, Y, and Z across systems, often without a definitive answer. The core issue is that each system records events, not outcomes. The fix is not more integrations but a single timeline. A proper ledger creates one atomic record of the payment lifecycle. The same transaction tracks USD in, USDC movement, FX conversion, and MXN payout. Every step is linked through a single identifier, and every state transition is explicit. That unlocks concrete use cases. You can answer “where is the money” with one query, not four systems. You can measure FX revenue and slippage per transaction, not per month. You can prove to regulators exactly when compliance held and released funds. You can resolve failed payouts instantly by locating funds in holding states. The shift is clear. Moving money is solved, but we still have not solved how to record it. The system that wins is the one that turns fragmented events into a single, auditable narrative. Insights by Formance

We’re not debating policy—we’re interpreting the math. In international trade, numbers speak louder than opinions. Too often, people talk about tariffs, duties, and VAT as if they're theoretical or "projected" costs. But when you're exporting to markets like Brazil, Colombia, or India, you're dealing with real, current costs—not forecasts. And those costs are shaping the global trade conversation, especially around the idea of reciprocity. Before forming a perspective on trade policies, it’s worth understanding what’s actually happening at the ground level. Not politics. Not the speculation. But the hard numbers. If you're in export, logistics, or policy analysis, this checklist should be your starting point: ✔ Break down duty + VAT + fees for each country ✔ Know your Total Landed Cost (TLC) inside out ✔ Use tariff databases to benchmark real costs ✔ Track how those costs impact product competitiveness ✔ Separate data interpretation from policy opinions The math is already there. You just have to know where to look. #GlobalTrade #SupplyChainStrategy #InternationalBusiness #ExportInsights #TradePolicy #TariffsAndDuties

Transfer Pricing (TP) is the price charged for goods, services, intellectual property, loans, or shared resources exchanged between different entities of the same multinational group. Why Transfer Pricing is Critical 1. Tax Compliance - Governments want to ensure companies do not artificially shift profits to low-tax countries. Example: If a company charges an unrealistically low price from India to a subsidiary in a tax-haven country, profits may be shifted improperly. Tax authorities such as: * Internal Revenue Service (USA) * Central Board of Direct Taxes (India) closely examine transfer pricing arrangements. ⸻ 2. Avoiding Heavy Penalties Incorrect transfer pricing can lead to: * Additional tax assessments * Interest charges * Penalties * Double taxation * Litigation costs Many multinational companies have paid hundreds of millions of dollars in TP disputes. ⸻ 3. Determines Global Profitability For a CFO, transfer pricing directly impacts: * Country-wise profitability * Business unit performance * Management reporting * Investment decisions If transfer prices are wrong, business performance can appear misleading. ⸻ 4. Cash Tax Optimization A well-designed TP policy helps: * Reduce overall effective tax rate * Optimize global cash flows * Improve working capital management This must always comply with regulations and documentation requirements. ⸻ 5. Regulatory Requirement Most multinational companies must maintain: * Transfer Pricing Study * Functional Analysis (FAR Analysis) * Benchmarking Reports * Master File * Local File * Country-by-Country Reporting (CbCR) Failure to maintain documentation can trigger audits. The Most Important Concept: Arm’s Length Principle The golden rule of transfer pricing is: Related-party transactions should be priced as if the parties were independent third parties. This is known as the Arm’s Length Principle, promoted by the Organisation for Economic Co-operation and Development. A CFO typically focuses on: Strategic Areas 1. Tax Risk Management 2. Audit Readiness 3. Profit Allocation Across Countries 4. Cash Repatriation Planning 5. M&A Integration 6. Shared Service Center Cost Allocation 7. Global Effective Tax Rate Management

Before I let a CFO in Dubai sign an ERP contract, I ask 7 questions about multi-currency and FX rules. (Most vendors can’t answer even 3.) And that’s exactly why 90% of ERP finance teams end up with workarounds, Excel patches, or fire drills every month-end. Here’s what I ask every single time: (1) How does the system handle revaluation gains/losses across ledgers in real-time? (Or are you manually booking journals at month-end?) (2) Can FX rates be pulled live from central banks or is it still a static upload via CSV? (3) What happens to historical FX rates when you reopen a prior-period transaction? (4) Can you tag currency exposure by project, vendor, or contract in reporting? (5) Does multi-entity consolidation auto-adjust for intercompany FX differences? (Or do you have to “explain” the ��6.2M gap to auditors every year?) (6) How does the ERP treat rounding off in multi-currency AP/AR aging reports? (7) Does the ERP allow dual base currencies? (say, for reporting in USD and AED natively?) If your vendor can’t answer these, walk away. Because the moment your business hits scale or enters new geographies… Your ERP won’t just fail. It’ll cost you millions in lost visibility and manual firefighting. Want the full 23-question FX audit checklist I use before every ERP project? Just comment “FX Checklist” below and I’ll send it across. ♻️ 𝐑𝐄𝐏𝐎𝐒𝐓 so others can learn.