Multicurrency transactions are a key component for the growth of UK businesses. The total export of goods outside the UK in September 2025 was over £29 billion. As soon as a business starts gaining customers from outside the UK, pricing, payments, foreign exchange (FX) timing, and even reporting take on new dimensions. The choices you make here can shape margins, compliance, and more.

This guide breaks down multicurrency transactions for UK businesses, including how UK businesses accept, hold, convert, and account for funds in different currencies. Here’s what you should know.

What’s in this article?

• What are multicurrency transactions for UK businesses?
  
• How do UK businesses accept, hold, and settle funds in multiple currencies?
  
• What are the main FX considerations UK businesses need to manage?
  
• How do cross-border fees and scheme rules affect multicurrency card payments?
  
• What tax and accounting issues come with multicurrency transactions?
  
• How should UK businesses decide which currencies to support and which to convert?
  
• How Stripe Payments can help
  

What are multicurrency transactions for UK businesses?

A multicurrency transaction involves more than one currency. For a UK business, that means a transaction that deals with a currency other than the British pound (GBP). For example, a customer in the US could pay in dollars or a supplier in Germany might bill you in euros. If more than one currency shows up between payment and settlement, it counts as a multicurrency transaction.

In ecommerce for many UK businesses, shoppers see prices in their local currency and pay in that currency. The businesses then receive the funds and either convert them to GBP or hold them as the foreign currency.

How do UK businesses accept, hold, and settle funds in multiple currencies?

UK businesses handle multicurrency money flows through a mix of tools that cover three steps: accepting payments, holding foreign balances, and settling those funds in the right accounts. Each step shapes the cost, speed, and flexibility of international revenue.

When it comes to accepting payments, companies usually start with one of three setups:

• Foreign currency bank accounts: Traditional banks offer euro, dollar, and other currency accounts, which let you accept payments directly in that currency. These accounts provide stability and separation between currencies. They typically require more administrative setup, local documentation, or minimum balances, and they often carry monthly fees.

• Multicurrency payment providers: Providers such as Stripe handle the logistical side of accepting payments in dozens of currencies. A customer pays in their local currency, and Stripe routes the funds into your system. You can allow automatic conversion to GBP or maintain balances in the original currency.

• Global or multicurrency digital accounts: These services act like consolidated wallets for multiple currencies. They often assign local bank details, such as an International Bank Account Number (IBAN) or US account number, so customers abroad can pay you as if you were a local business. You can receive, hold, and send funds in multiple currencies and convert only when it works for you.

Holding a balance in its original currency gives you more control over conversion costs. Businesses often hold currencies when they have upcoming expenses in that market, want to avoid multiple conversions, or intend to convert when exchange rates move in a favorable direction.

The settlement process depends on the system you use. Bank accounts settle directly into their own currency, multicurrency accounts settle within the platform until you choose to move or convert funds, and a payment provider such as Stripe settles either in GBP or in supported foreign currencies, depending on your payout settings and connected accounts.

Each path serves a different financial strategy. The right mix depends on your customer base, cash flow needs, and how actively you manage currency exposure.

What are the main FX considerations UK businesses need to manage?

Foreign exchange (FX) shapes the real cost and value of every multicurrency flow. When making decisions, UK businesses pay close attention to three areas: rate movement, conversion costs, and timing.

Exchange rate movement and financial exposure

Currency rates shift constantly, which means the value of your foreign revenue can shift too. A euro or dollar balance can gain or lose value against GBP between the day a customer pays and the day you convert it.

Businesses look at how much volatility they can absorb before it disrupts margins or cash flow. Some convert funds quickly to lock in a known sterling amount. Others maintain foreign balances so they can convert at a moment that works best with their financial plans. Small teams might choose to rely on rate alerts or treasury dashboards to stay aware of price shifts.

Conversion costs and fee structures

Every conversion involves a fee or an embedded markup in the exchange rate. Even slight differences in these markups can influence margins over time. Businesses should look closely at details such as the provider’s FX margin, the transparency of the rate they receive, and how often conversions occur across their payment flow.

Minimizing unnecessary conversions matters. Multicurrency tools help by letting you hold or spend foreign funds directly instead of repeatedly passing them through GBP.

Timing and planning

FX strategy becomes easier when it matches your cost structure. A business with regular USD expenses often keeps USD revenue in its original currency. This creates a natural match between inflows and outflows and reduces exposure to rate swings. Other businesses might set thresholds or rules that guide when and how they convert.

How do cross-border fees and scheme rules affect multicurrency card payments?

Cross-border card payments layer additional costs and rules onto multicurrency transactions. Those details shape pricing and the customer experience.

Cross-border fees

When a customer abroad pays a UK business using a card, the card networks treat the payment as international. That classification triggers a cross-border fee that flows through the business’s payment processor. A second fee appears when the card’s currency and the business’s settlement currency differ. This structure often appears as a standard international surcharge plus a separate conversion fee when the transaction involves two currencies.

Interchange rates

Interchange also plays a role. UK–EU online card payments now sit outside the regional interchange caps that once applied before Brexit. Visa and Mastercard increased interchange on these flows, which lifted costs for UK businesses selling to EU customers. A UK business processing an EU debit or credit card now incurs interchange of 1.15%–1.50%, rather than the previous 0.20%–0.30% rates. These increases apply across the ecosystem because they are set by the networks.

Currency transparency requirements

Card schemes set standards that protect customers from unclear currency conversions. When a business or a payment provider offers to process a card in a currency other than the card’s home currency, the customer must see the exchange rate and markup. EU regulations specify that conversion charges appear as a percentage over the European Central Bank rate, which gives customers a baseline for comparison at checkout.

What tax and accounting issues come with multicurrency transactions?

Multicurrency activity can add extra accounting steps for UK businesses. The work falls into three areas: financial reporting, tax treatment, and value-added tax (VAT) requirements.

Financial reporting in GBP

UK businesses prepare statutory accounts in pounds, which means every foreign currency transaction is converted to GBP for bookkeeping. Teams might record each sale or expense using the exchange rate from the transaction date or a reliable period average.

Unsettled foreign balances at year-end, such as outstanding invoices or cash held in another currency, are revalued using the reporting date’s rate. This can create unrealized gains or losses that flow through the profit and loss statement. Modern accounting systems often automate these calculations and pull in daily or monthly rates to keep records consistent.

Tax treatment of exchange gains and losses

Currency movements influence taxable profit because exchange differences recognized in the accounts generally feed directly into the corporation tax calculation. Gains lift taxable income, while losses reduce it.

Businesses that hold large foreign balances or convert at irregular intervals pay close attention to how these movements build up over time. Matching foreign revenue with foreign expenses can create a natural offset that reduces swings in reported profit.

VAT on foreign currency invoices

VAT-registered businesses must show VAT amounts in both the invoice currency and GBP. His Majesty's Revenue and Customs (HMRC) allows several approved sources for the sterling conversion, including its own published rates. When payment arrives at a different exchange rate than the one used on the invoice, the difference becomes an exchange gain or loss rather than a VAT adjustment.

Good records, consistent rates, and reliable systems keep multicurrency accounting straightforward, even when exchange rates move more than expected.

How should UK businesses decide which currencies to support and which to convert?

Choosing which currencies to support requires considering your customer demand, your operating costs, and the level of difficulty your team can maintain. Here’s how to approach this choice.

Start with your customers’ home currencies

Commonly used currencies usually come from markets that already drive strong traffic or revenue. A UK business selling heavily into the US, EU, or Australia often adds USD, EUR, and AUD early because customers in those regions will likely expect to pay in their own currency. Local pricing lifts confidence at checkout and helps remove any uncertainty that appears when amounts feel unfamiliar.

Balance revenue potential with logistical effort

Each added currency brings work: pricing updates, payment flow adjustments, accounting entries, and periodic FX decisions. Businesses might choose the currencies that cover the majority of international sales and rely on conversion for others. This approach keeps operations lean while still delivering a localized experience in the markets that matter.

Match currencies to your cost structure

Foreign balances become more valuable when they line up with foreign expenses. A business with regular USD supplier costs can keep USD revenue in its original currency to create a natural hedge. This option can reduce conversion frequency and make cash flow planning more predictable.

Review and adjust over time

Your overall customer mix evolves, and new markets sometimes grow faster than expected. A periodic review of sales by region, currency balances, and FX costs can help determine when to add or retire a supported currency. The goal is a focused set of currencies that support revenue growth without adding unnecessary logistical work.

How Stripe Payments can help

Stripe Payments provides a unified, global payments solution that helps any business—from scaling startups to global enterprises—accept payments online, in person, and around the world.

Stripe Payments can help you:

• Optimize your checkout experience: Create a frictionless customer experience and save thousands of engineering hours with prebuilt payment UIs, access to 125+ payment methods, and Link, a wallet built by Stripe.

• Expand to new markets faster: Reach customers worldwide and reduce the complexity and cost of multicurrency management with cross-border payment options, available in 195 countries across 135+ currencies.

• Unify payments in person and online: Build a unified commerce experience across online and in-person channels to personalize interactions, reward loyalty, and grow revenue.

• Improve payments performance: Increase revenue with a range of customizable, easy-to-configure payment tools, including no-code fraud protection and advanced capabilities to improve authorization rates.

• Move faster with a flexible, reliable platform for growth: Build on a platform designed to scale with you, with 99.999% historical uptime and industry-leading reliability.

Learn more about how Stripe Payments can power your online and in-person payments, or get started today.