Thanks to the explosion of eCommerce, international transactions offer enormous growth potential for small businesses. Unfortunately, cross-border transactions generate fees that, if you don't watch them carefully, can eat into the profit margins you could otherwise build. To get the most from your cross-border business, focus on these five ways to reduce your transaction fees.
1. Local Acquiring
A difference between customer location and acquiring bank location is the primary driver for cross-border fees. With all things being equal, the greater the distance between your customers and the acquiring bank, the greater the amount of your customer payment declines. When an acquiring bank doesn’t recognize the customers bank, it is more likely to decline a transaction, leading to higher rates for you. Adding a local acquiring bank, therefore, boosts your performance and lowers your rates.
2. Interchange++ Rates
If a processor charges a blended rate, it does so by averaging the fees for all payment types. This can cost you money by charging you more for payments with debit cards, for example, than you should be paying. By paying at Interchange++ rates, on the other hand, you tailor your fees to the ways customers pay, avoiding overpayment by design.
3. One-Click Payments
The longer the process of moving from discovery to payment, the more likely it is for a customer to abandon the purchase. Offering a one-click payment process takes away the opportunities for a customer to stop and look elsewhere. This leads to more purchases, a higher conversion rate, and, therefore, lower fees for your cross-border payment solution.
4. Decline Recovery Processes
If you convert more payments, you can also lower your transaction fees. Too many transactions are lost because the initial payment method fails. Nuvei's automatic decline recovery solution reroutes customers from a declined payment immediately into the chance to submit an alternate payment method. This keeps your customer with you longer and helps drive through to complete the payment.
5. Customized Payment Options
Finally, problems with currency or payment method conversions can create problems for you. The solution is to customize the payment method for the location in which you are processing. This reduces confusion for your customers and helps you not only complete more payments but reduce chargebacks after sales close. Each of these helps you avoid the hiccups in your process that can increase your cross-border transaction fees.
High cross-border fees do not have to be a fact of life for your business. When you work with the right payment partner, you give yourself a chance to reduce fees and maximize your profit margins for international sales. Nuvei has the tools you need to not only expand your revenue across borders but to get the most out of every sale you make.