How to eliminate cross border and FX fees in travel payments
It’s no secret that travel companies operate in a fiercely competitive environment with thin profit margins. To cut into those margins even further, making international supplier payments adds additional costs due to fees such as cross border and foreign exchange (FX). However, there is a solution that allows travel companies of all sizes to eliminate cross border and FX fees on international payments made to suppliers.
What is a cross border fee?
A cross border fee is a card processing fee incurred when a merchant in one country (such as Italy) accepts a payment from someone whose card originates in another country (such as the United States).
What is a foreign exchange (FX) fee?
A foreign exchange fee is a surcharge that is split between the card network and the card issuer when a card transaction passes through a foreign bank or is made in a foreign currency.
How can I avoid cross border and FX fees?
ConnexPay’s Global Travel Virtual Credit Card (VCC) program is designed to benefit both travel companies and their international suppliers. When you make virtual card payments to your travel suppliers using Global Travel VCC, you’ll gain several benefits, including:
- No cross border or FX fees
- Improved card rebates
- Lower cost of supplier acceptance
- No cost or minimum volume requirement
- Settlement in local currency anywhere Mastercard or Visa is accepted
Travel companies issuing virtual cards with Global Travel VCC earn a net rebate that is about 1.00% higher than they would otherwise earn.
Similarly, there is a financial benefit to travel suppliers as well, because the net cost of accepting payments through Global Travel VCC is 0.75% less expensive.
What are the accepted merchant category codes (MCCs)?
Travel suppliers must be configured as one of the following MCCs for the Global Travel VCC program:
- Airlines: 3000–3350, 4511
- Automobile/Vehicle Rental: 3351–3500, 7512, 7513, 7519
- Cruise/Steamship: 4411
- Global Wholesale Travel Other: 4131, 4582, 4722, 5962, 6513, 7012, 7032, 7033, 7298, 7991, 7997, 7999
- Lodging: 3501–3999, 7011
- Railways: 4112
How can I start using Global Travel VCC?
ConnexPay’s all-in-one payments platform was purpose-built for travel companies, providing immediate access to incoming funds which can be used to make outgoing supplier payments. There’s one contract, one platform, and one reconciliation. With rapid implementation and no setup fees, it takes just a few minutes to discover how you can get started and use all the benefits ConnexPay provides, including access to Global Travel VCC.