What Currency Option Offers the Customer the Most Value?
The first option of actually applying a multiplier and exchange rate to the currency is most likely the optimal scenario for an end user, as everything is seamless for them. In this case, the vendor has a single base price for items, at least when the distribution center(s) are in a location with a different base currency than the payment options available through the eCommerce application.
Examples of Accepting Multiple Currencies
Let's consider a scenario where we're currently selling in US dollars while manufacturing in a location that does all of the ERP and accounting in US dollars, but would like the ability to sell in Canadian dollars or in euros. That would require the end user to be able to calculate the rates and have some sort of notification about what the offering is going to cost in their respective currency.
The selection might include Canadian dollars, euros, yen, pounds or another currency. What we want for the end users is a simple procedure, where they can simply click a drop-down menu or a flag and select their preferred language and currency.
That should be the only required step for end users and, as far as they're concerned, everything on the site must be translated to their particular expectations for currency and language. Users are accustomed to seeing their currency represented in the familiar format, with the appropriate symbols and currency denominators. So, if they're European buyers they will see euros, if they're in Canada they'll see prices represented properly in Canadian dollars, and so forth.
Using the Customer's Preferred Currency
These are really critical aspects for the end user and contribute to a smooth customer experience. In order to enable that capability, without physically performing a currency conversion that applies at an exchange rate, the payment processor is typically required to be set up in a way that allows payment processing in the different currencies.
So, if we offered pricing in US dollars and Canadian dollars, then we need the added ability to actually process the payments for both of those types of currencies. As the end user completes checkout and provides payment information, we must be able to process that payment with the specific currency they're sending over.