Multi-currency conversions and risks

Currency conversion occurs at the time of each transaction, such as when a charge is created or a refund is issued.

This article explains how currency conversion works for stores that sell in multiple currencies, including potential risks and key considerations. Multi-currency is available to all eligible Shopify merchants.

Before you start

• Shopify Markets is fully compatible with Recharge. To learn how Shopify Markets features work with Recharge, see Shopify Markets.

Currency conversion and risk

Currency rates are constantly fluctuating. Whenever there is a time delay in processing payments or refunds, you may lose or gain money due to currency conversions.

You can lose or gain money in the following situations:

• Orders are refunded
• Customers add or swap products for an upcoming order
• Payments are captured manually 
• Exchange rates are set manually 
• A chargeback is issued 

Checkout and recurring transactions

The price and conversion rate used are calculated based on your setup within Shopify Markets.

The currency conversion rate does not change for recurring orders, and it will remain the same as the rate for the first order your customer places. This is because the customer's subscription price is set when the initial order is placed.

You can see the breakdown of a transaction in the Shopify order timeline.

Add or swap products

If new products are added or an existing subscription is swapped to a different product variant via Recharge's merchant portal, customer portal, or API, the price is calculated using an automatic exchange rate and does not leverage Shopify Markets' price lists. 

This may cause discrepancies in expected prices as the automatic exchange rates calculated by Recharge will differ from the prices offered on your storefront.

In this scenario, Recharge calculates the automatic exchange rate. Recharge calculates the price in the customer’s presentment currency by multiplying the product price in the store currency and the foreign exchange rate at the close of the prior business day.

Recharge retrieves its foreign exchange rates daily from Open Exchange Rates. This may lead to discrepancies in expected prices when selling in markets with volatile exchange rates. 

Volatile currencies

Shopify does not automatically enable currencies deemed volatile. To enable one, create a market for each country you want to sell in, using the local currency.

It is important to understand the risks of enabling different currencies. These currencies can fluctuate frequently, which may result in gains or losses on returns or exchanges. We encourage you to discuss this with your finance teams.

Review Shopify's list of Volatile currencies. Shopify has determined these currencies as volatile. 

Shipping

In most cases, Shopify determines shipping rates at checkout and for recurring orders.

For Recharge stores that use Recharge Shipping zones and rates to calculate shipping for recurring orders, Recharge calculates the shipping price in the customer’s presentment currency by multiplying the store-currency shipping price by the foreign exchange rate at the close of the prior business day.

Refunds

There is often a delay between placing an order and issuing a refund. For customers requesting a refund, the amount refunded should be the exact amount the customer paid in their local currency at the time of checkout. You may lose or gain money due to currency conversions from the exchange rates at the time of the refund.

The currency conversion calculated during a refund is handled by your payment service provider.

Payouts

Stores can sell in multiple currencies, but payouts will always be settled in the default store currency. The payment service provider handles the currency conversion before settling the funds in your account.

Recharge is not responsible or involved in this process.

Invoices

Recharge invoices all stores in United States dollar (USD). When selling in multiple currencies, the charge amount is converted to USD at the time of the transaction.

Refer to the charge processed export to view the conversion rate used to calculate your invoices.

Fixed-price discounts

Fixed discount codes for multi-currency addresses are automatically converted to the customer’s presentment currency. 

This behavior is controlled by your currency settings, which allow fixed-price discounts to adjust based on the customer’s local (presentment) currency.

You must enable this setting to ensure fixed-price discounts are available for multi-currency customers. For stores created after October 25, 2023, this setting is enabled by default. Note that only the discount value is converted to the customer’s presentment currency. The minimum purchase value (if set in the discount configuration) remains in your store’s base currency and is not converted.

You can enable this setting in the Recharge merchant portal:

1. Click Settings and select Store in the Recharge merchant portal. 
2. Under Currency settings, toggle Convert fixed price discounts to the customer's currency on.
   
3. Click Save to confirm changes.