The Reach FX Solution

About

Reach supports local processing of payments in 135+ currencies, allowing you to present and process in your customer’s native currency. Using Reach local processing will improve your sales and help customers avoid high conversion costs and fees. Reach FX solutions give your customers much better rates than what they are currently charged by their banks.

Our FX Solutions

Reach provides two solutions for processing in local currencies, our Standard FX solution and our Guaranteed FX solution:

Standard FX	Guaranteed FX

The Standard FX Solution is the norm across the payments industry.	The Reach Guaranteed FX Solution is a custom solution developed specifically for merchants selling cross-border.
Reach has access to the best exchange rates from its foreign exchange partners, and provides those rates to merchant.	Reach provides an extremely competitive rate to its merchants, which is then warranted and guaranteed from the time of purchase to the time of settlement. Merchants can rely on this rate at the time of the transaction, and for 30 days after purchase in case of returns or exchanges. Reach takes the risk of currency fluctuation during checkout and for 30 days after purchase for refunds and exchanges.
With this solution, merchants can control how (and how much) to charge their customers, and can pad the product price as they see fit to cover any possible rate fluctuations.	This solution allows remarkable flexibility for merchants to grow into new markets with little to no heavy lifting on the reporting side.

Features

Standard FX	Guaranteed FX
An industry-standard solution with the best exchange rates in the industry. .	A straightforward solution with no complex FX knowledge required.
For merchants who understand the risks of FX fluctuation, and want complete control over their pricing.	For merchants who want protection from the risk of FX market fluctuation. Exchange rates available for use for 24 hours.
Granular, industry-standard reporting for sophisticated accounting teams who work magic with their cash flow forecasting.	Simple reconciliation and reporting, with fixed FX rates through returns and regularly scheduled settlement timeframes for every transaction.
Some currency fluctuation risk for merchant.	No currency fluctuation risk for the merchant on cost of returns or exchanges within 30 days.
Merchant markup is configurable within pricing.	Merchant can add an additional, entirely configurable FX markup to offset costs. This *optional* markup is paid by the end customer and returned to the merchant at settlement.

The Type of Rate Provided by Reach

Standard FX	Guaranteed FX
The indication rate provided by Reach is a mid-market rate. This means we provide "an indication" of the average of the prices at which people are buying and selling the currency. This is *not* the actual tradeable FX rate which will be applied to the transaction.	The guaranteed rate* provided by Reach is a very competitive (wholesale) rate that's available exclusively to Reach merchants. This rate changes every 6 hours, and is guaranteed for 24 hours. Refunds are guaranteed for 30 days.

How it Works

Standard FX

The merchant queries Reach system to get an indication rate. (NOTE: This service is entirely optional and provided only for the convenience of the merchant. Merchants may use any indication rate they wish.)
Merchant can choose how to display the local pricing using their pricing strategy.
The merchant submits the payment to Reach in local currency amount.
Reach processes the transaction in local currency.
The actual FX rate is determined once the amount collected in the customer's currency is converted into the merchant's currency.
Reach converts the customer funds to the merchant's settlement currency once customer funds are received by Reach and then settles to the merchant.

Guaranteed FX

The merchant queries Reach system to get an indication rate. (NOTE: This service is entirely optional and provided only for the convenience of the merchant. Merchants may use any indication rate they wish.)
Merchant can choose how to display the local pricing using their pricing strategy.
The merchant submits payment to Reach in local currency amount with Rate Offer ID.
Reach processes the transaction in local currency.
The guaranteed rate* is used when processing the transaction. The guaranteed rate is applied against the total gathered from the customer in the customer's currency and used to convert to the merchant's currency (regardless of the current FX rate). The FX variability is absorbed by Reach.
Reach settles the funds to the merchant as soon as the transaction is processed.

Determining the Price the Customer Sees

With both of our FX solutions, the merchant is responsible for determining the price to charge the customer in the local currency:

Standard FX	Guaranteed FX
Merchant determines the price to charge the customer in the local currency.	Merchant determines the price to charge the customer in the local currency.

The key difference is...

Who takes the Risk of Currency Rate Fluctuation

With the standard rate, the merchant takes the risk of currency fluctuation, while with our guaranteed rate, Reach takes the risk of currency fluctuation

Standard FX	Guaranteed FX
Merchant takes the risk of currency rate fluctuation.	Reach takes the risk within the guaranteed rate period.

Conversion on Disputes and Refunds

Standard FX	Guaranteed FX
If a currency-converted payment is disputed or refunded, the amount you receive is converted back to the presentment currency at the current available rate. Rates fluctuate on a daily basis, so the rate used at the time of the original transaction often differs from the rate used when a dispute or refund occurs days (or even weeks) later. The returned amount can be less—or more—than the amount of the original payment. Ultimately, a customer is always refunded the exact amount they paid and in the currency they paid in, regardless of the rate and cost to the merchant. Gains or losses on this rate fluctuation are always the responsibility of the merchant.	If a currency-converted payment is disputed or refunded, the amount you receive is converted back to the presentment currency at the original guaranteed rate provided on the day the transaction was created. We guarantee the exchange rate for 30 days. WIthin that 30 day window, the refund amount will always be the exact same amount as the original payment. After 30 days, Reach will use the current rate to calculate the amount of the refund (similar to the Standard FX solution).
For example: You sell a t-shirt for $100 USD. You also use an indication rate to show European customers what it costs in Euro. In this case, at a rate of €0.88 per $1.00, a European customer purchases your t-shirt for 88 Euros. Great! You get 88 Euros into your account. Later on, the customer returns the t-shirt. The FX rate at that time has changed, and is €0.86 per $1.00. Your account is debited €86 Euros for that return. The difference between the purchase price and the refund price is effectively €2.00 EUR.	For example: You sell a t-shirt for $100 USD. You use the Reach Guaranteed Rate to show European customers what they will pay in Euro. In this case, at a rate of .9163 per $1.00, a European customer purchases your shirt for 91.63 Euros. We remit $100 USD. The customer returns the t-shirt 25 days later. Easy! You refund that same $100 USD. The customer gets back exactly what they paid - €91.63 EUR.

Standard FX

Guaranteed FX

If a currency-converted payment is disputed or refunded, the amount you receive is converted back to the presentment currency at the current available rate.

Rates fluctuate on a daily basis, so the rate used at the time of the original transaction often differs from the rate used when a dispute or refund occurs days (or even weeks) later. The returned amount can be less—or more—than the amount of the original payment. Ultimately, a customer is always refunded the exact amount they paid and in the currency they paid in, regardless of the rate and cost to the merchant. Gains or losses on this rate fluctuation are always the responsibility of the merchant.

If a currency-converted payment is disputed or refunded, the amount you receive is converted back to the presentment currency at the original guaranteed rate provided on the day the transaction was created.

We guarantee the exchange rate for 30 days. WIthin that 30 day window, the refund amount will always be the exact same amount as the original payment.

After 30 days, Reach will use the current rate to calculate the amount of the refund (similar to the Standard FX solution).

For example:

You sell a t-shirt for $100 USD. You also use an indication rate to show European customers what it costs in Euro. In this case, at a rate of €0.88 per $1.00, a European customer purchases your t-shirt for 88 Euros.

Great! You get 88 Euros into your account.

Later on, the customer returns the t-shirt. The FX rate at that time has changed, and is €0.86 per $1.00. Your account is debited €86 Euros for that return.

The difference between the purchase price and the refund price is effectively €2.00 EUR.

For example:

You sell a t-shirt for $100 USD. You use the Reach Guaranteed Rate to show European customers what they will pay in Euro. In this case, at a rate of .9163 per $1.00, a European customer purchases your shirt for 91.63 Euros.

We remit $100 USD.

The customer returns the t-shirt 25 days later. Easy! You refund that same $100 USD.

The customer gets back exactly what they paid - €91.63 EUR.

Best Uses/Use Cases

Offer your customers much better FX rates than what they are currently charged by their banks

Standard FX	Guaranteed FX
In the Standard Solution, the FX rate is the best possible rate, but the risk of currency fluctuation is with the merchant.	In the Guaranteed solution, merchants move FX risk to Reach which protects the merchant from FX volatility.
Standard Rates are ideal for: Stores with an FX-savvy customer base. These customers will be more aware of what the current FX rate is and will prioritize purchases based on which brands have the best rates. For these types of consumers , the closer the rate used to convert prices is to the actual FX rate, the more likely this customer base is to buy from your store.	Guaranteed Rates are ideal for: Stores that have a high number of refunds
Brands that need the best FX rate, and don't mind handling the associated complexities.	Accounting teams who need to easily forecast cash flow.
Time-delayed shopping journeys (pre-orders, partial orders, etc).	Stores that maintain a delay between authorization and capture (due to increased time between the quoted price and the actual trade occurring).
For merchants that want great foreign exchange rates with no need to outsource complexities.	For merchants that want to outsource the complexities of foreign exchange but don't want to get burned by bad rates from other FX providers.
For merchants with a robust accounting team that understands currency fluctuation and how foreign exchange figures into international pricing strategy.	For merchants with smaller accounting teams that aren't as familiar with currency fluctuation and international pricing strategies with FX.

Considerations

Standard FX	Guaranteed FX
Merchant will take on the FX risk. If the currency moves from the time of authorization to settlement or refund, the merchant profit margin will be affected.	The FX rate used to calculate the cost of an item will fluctuate from day to day, and during the day itself.
For example: A merchant can display whatever price they like based on their pricing strategy. Merchants can use various rounding rules or display rules to minimize the impact of changing prices on customers. If a merchant decides to charge 91.00 EUR for a product based solely on the Reach indication rate, the FX rate can move between the time of authorization and settlement. Based on market fluctuations, a merchant may be remitted less than, the same as, or more than the 91.00 EUR.	For example: If a merchant displays a price based solely on the Reach guaranteed rate, a customer viewing the website on a Monday, may see a product for 91.63 EUR. When they come back to the website on Thursday the same product may have a different price based on market fluctuations like 91.22 EUR or 91.87 EUR. Merchants can use various rounding rules or display rules to minimize the impact of changing prices on customers.
Market fluctuations as well as the overall number of currencies you accept combine to increase reporting and reconciliation complexity.	Reach Guaranteed Rates change every 6 hours.

Standard FX

Guaranteed FX

Merchant will take on the FX risk. If the currency moves from the time of authorization to settlement or refund, the merchant profit margin will be affected.

The FX rate used to calculate the cost of an item will fluctuate from day to day, and during the day itself.

For example:

A merchant can display whatever price they like based on their pricing strategy. Merchants can use various rounding rules or display rules to minimize the impact of changing prices on customers. If a merchant decides to charge 91.00 EUR for a product based solely on the Reach indication rate, the FX rate can move between the time of authorization and settlement. Based on market fluctuations, a merchant may be remitted less than, the same as, or more than the 91.00 EUR.

For example:

If a merchant displays a price based solely on the Reach guaranteed rate, a customer viewing the website on a Monday, may see a product for 91.63 EUR. When they come back to the website on Thursday the same product may have a different price based on market fluctuations like 91.22 EUR or 91.87 EUR. Merchants can use various rounding rules or display rules to minimize the impact of changing prices on customers.

Market fluctuations as well as the overall number of currencies you accept combine to increase reporting and reconciliation complexity.

Reach Guaranteed Rates change every 6 hours.

Settlement

Standard FX	Guaranteed FX
At time of settlement, Reach will automatically convert the funds to your default settlement currency, based on the currency exchange rate at that time. (Note: currency rates fluctuate on a daily basis, so the exchange rate on the day the transaction was created, and the day the transaction was settled can often differ dramatically).	At time of settlement, Reach will automatically convert the funds to your default settlement currency, based on the guaranteed rate provided by Reach on the day the transaction was created. (Note: With this solution, there is no currency risk for the merchant. If a product was priced at $100 USD, and the customer pays 91.63 EUR, the merchant will be remitted $100 USD regardless of currency movement between transaction creation and settlement).
The default settlement period for our Standard FX solution is determined from when the transaction reaches the "completed" state. Transactions reach "completed" state when funds from the transaction are received by Reach from its processing partners.	The default settlement period for our Guaranteed FX solution is determined from when the transaction reaches the "processed" state. Even when Reach has not yet received the funds from its processing partners, Reach will pre-fund the merchant.
Reach will only settle to the merchant after our processing partners have settled to Reach. In some outlying cases, this can take multiple weeks.	Reach will settle to the merchant after a transaction reaches the "processed" state at an agreed upon periodicity. Merchants know exactly when a transaction is settled.
All transactions settled on a specific day have the same FX rate applied.	With guaranteed rates, each transaction has its own FX rate.

Questions?

For help, contact [email protected]