Currency Stream is enabling a leading privately held PSP and Payment Processor to deliver multi-currency conversion (MCC) services to their client ATM networks, Point of Sales (POS) and ePOS solutions.
Key to the client’s European growth strategy is a comprehensive currency solution, providing potential clients with a seamless and fully integrated offering for a range of customer facing payment services.
Key Customer Requirements
- FX pricing across 11 Visa and MasterCard Settlement currencies
- Hedging of all FX exposure, 24 hours a day, 7 days a week (24/7)
- Seamless settlement processing, with no regulatory impact
- Scalable solution with currencies not directly settled by Visa and MasterCard
The Solution
The client is integrated with the Currency Engine API to provide Merchants with Real-time FX rates, whilst Currency Stream manage the profile of usage and dynamically hedge all FX positions automatically via the API. Implementation took 6 weeks to migrate from a look-up table to providing live FX rates 24/7 in 14 countries.
Why did the client select Currency Stream as a partner?
- Robust solution with 7 years track record of stability
- Simple implementation (5-6 weeks)
- Technically and commercially scalable offering
- Highly competitive Fixed price and Real time model
- Profit maximization through dynamic pricing and risk management
- 42% improvement over standard DCC profitability for the client
“Fixed pricing enables our clients to price with certainty and protect margins in a competitive market”
Key Driver – To maximize profitability whilst remaining competitive
A key driver for the client was to maximize the commercial return whilst remaining highly competitive in their FX pricing to their Merchant clients. Currency Stream’s proprietary solution was unique in being able to address these opposing drivers, through delivery of:
Dynamic Yield Management (DYM)
Through real-time tracking of live data feeds combined with rules based management of information, the client has seen acceptance levels increase by 8% since go-live (6 months).
Dynamic Hedging of Foreign Exchange
Through the use of wholesale-market, industry- standard modeling and pricing tools, our FX booking engine automatically maximizes profit on each transaction whilst eliminating losses. As a result we increased DCC FX revenue yields by an average of 6% on traded currencies.
Lower Price Point for our Enhanced Services
In our industry, price usually reflects risk exposure for the DCC provider. Most competitors do not have truly dynamic hedging of their risk and therefore have to charge more for inferior solutions.
Currency Stream’s flat pricing model secured the client an additional 25 Basis Points per transaction of revenue above when compared to traditional DCC, enabling flexibility to price aggressively and/or yield greater profits.
Fixed pricing enables our clients to price with certainty and protect margins in a competitive market.
Improved pricing over weekends (dynamic price improvement)
Currency Stream is the only company providing real-time weekend pricing. We are therefore able to take advantage of minor price improvements on behalf of clients. With clients seeing large volume increases over weekends, the increase to overall revenues captured has been more than 3% compared with traditional solutions.
