What Does Double Conversion Mean?

Many entrepreneurs lose certain income due to double conversions, when the currency is converted twice during international transactions. Understanding this process is especially important for those working with foreign clients, as even a slight difference in exchange rates can significantly impact profits. For example, a payment in USD can first be converted to EUR, and then, when withdrawing in hryvnias, the business actually loses part of the income due to commissions and unfavorable exchange rates of the recipient’s bank. In this article, we will help you understand the key aspects of double conversion and provide practical advice for Ukrainian businesses:

1. Where double conversion occurs most often – find out which services and payment channels can “eat” your money.
2. As double conversion affects business – assess the real costs, risks and impact on competitiveness.
3. Tips for Ukrainian businesses – find out how to avoid extra fees and save profit on international payments.

What is double conversion of currency?

Double conversion of currencies is a situation that occurs during a transaction where the payment currency changes twice instead of once. Because of this, a business or an individual loses part of the funds due to the payment of an additional commission and due to an unfavorable exchange rate at each stage of conversion. How is double conversion happening?  For example, the client pays you in USD, but the payment provider converts USD → EUR because you have an account in EUR. Next, your bank will already convert EUR → UAH, as shown in the diagram below.

What is lost at each stage?

Stage	Conversion	Losses
1.	USD → EUR (payment provider)	Conversion fee + exchange rate may be lower than the market rate
2.	EUR → UAH (bank/recipient)	The bank’s additional commission + exchange rate can also be lower than the market rate
Together	Double Conversion	Cumulative losses: two commissions and two rates, reducing the amount you could have actually received

Let’s consider an example in numbers. The customer pays you 100 USD. The payment provider converts to 82 EUR (after commission and exchange). The bank converts 82 EUR → 3900 UAH (again losing on the exchange rate and commission). If the conversion was one-time (USD → UAH), it would be possible to get more, for example, 4100 UAH, i.e. 200 UAH lost or almost 5% due to double exchange.

Where does double conversion occur most often?

Let’s analyze the main cases where it occurs most often double conversion during real financial transactions. We will show exactly how a currency can be converted twice: first into one intermediate currency, and then into the recipient’s final currency. This applies not only to bank cards and payment gateways, but also to international marketplaces, freelance marketplaces, exchanges, and even cross-platform transactions, where double conversion can happen at Payoneer.

• Bank cards. When you pay for the product in a currency different from the currency of your account, the bank may first convert the amount into the currency of the card and then into the national currency.
• Payment gateways. Some online payments are made automatically with a double conversion to reconcile currencies between the seller and the buyer. For example, USD of the buyer → EUR of the payment gateway → UAH of the seller’s bank.
• Payoneer → Ukrainian banks. If the Payoneer account is in dollars or euros and the account in a Ukrainian bank is in hryvnias, the money is converted first into the bank’s currency and then into hryvnias.
• International marketplaces (Amazon, eBay). The buyer pays in one currency, the marketplace can transfer to another for internal settlements, and then the seller’s bank or payment provider does another conversion in local currency.
• Online freelance platforms (Upwork, Fiverr). A freelancer’s earnings can be converted first to the platform’s currency and then to the currency of the bank account or payment card.

How does double conversion impact the business?

Double conversion currency means additional costs and complications in financial accounting, especially for companies that work not only on local markets, but also with international partners. Business has negative consequences in several directions, which reduce efficiency and competitiveness. The following table shows the specific influencing factors of double conversion. 

Impact Factor	Explanation	Implications for business
Additional Commissions	Each conversion is accompanied by commissions of banks or payment providers.	Increase in transaction costs, decrease in profit.
Unfavourable exchange rates	The exchange rate difference between the first and second conversions.	The final amount of the payment exceeds the expected, reducing the margin.
Opaque income accounting	Income in different currencies is difficult to reconcile.	It complicates financial analysis and planning.
Accounting Problems	Income and expenses are converted into different currencies.	It takes more time for reporting and auditing, increasing the risk of errors.
Risk of loss due to currency fluctuations	Currencies may fluctuate between conversions.	Unforeseen financial losses are possible.
Decrease in demand	Higher final price for the buyer.	Loss of customers and reduced sales.
Decrease in competitiveness	Accounting costs and complications make business more expensive.	Competitors with direct currency transactions may offer lower prices.
Difficulty tracking transactions	Double conversion complicates reporting.	Confusion in accounting, risk of tax problems.

How to avoid double conversion?

To minimize double conversion and lower transaction costs, follow these five steps:

1. Use multi-currency accounts. Payoneer allows you to open accounts to receive payments in the currencies you want (more than 70), reducing the need for exchanges and avoiding double conversion.
2. Convert currency in advance. Before making a payment, use the conversion feature in your Payoneer account to control the exchange rate and avoid unexpected expenses.
3. Specify the currency of the recipient’s account. Pay in a currency supported by the recipient’s account. So you can bypass double card conversion and do not spend more money than the payment amount.
4. Plan international money payments. Monitor exchange rates and choose the optimal time for transfers. Planning helps minimize the risk of double conversion and provides more favorable conditions for business.
5. Use alternative payment services. Use services with favorable conversion rates or without additional fees. 

Examples of double conversion in popular services

Let’s look at specific examples of how double conversion happens in popular services, including Payoneer, banks, payment gateways, marketplaces, and online freelance platforms. The table shows several examples of the sequence of currency transactions and shows how it occurs through double conversion.

Service	Double Conversion Type
Payoneer	USD → EUR → UAH
Payment Gateways	USD → EUR → UAH
Banks	EUR → USD → UAH
Marketplace (Amazon, eBay)	USD → GBP → UAH
Online freelance platforms (Fiverr)	USD → EUR → UAH

Tips for Ukrainian business

To minimize costs and get rid of unnecessary fees associated with double conversion, follow these practical tips:

• Open several currency accounts. This allows you to receive and store funds in the currency of payment without intermediate conversion.
• Work with clients in the agreed currency. Agree on a payment currency that matches your bills so you don’t pay for extra transfers.
• Use fintech services with a transparent rate (for example, Payoneer). Such services allow you to control the exchange rate and not pay additional fees related to double conversion.
• Always check the exchange rate and currency before a transaction. This helps you plan expenses more efficiently and protects you against unexpected fees due to intermediate conversions.
• Document all currency transactions. Keeping clear records helps you track conversions and analyze where you can cut costs.

Summary

Don’t let double conversion steal your profit! Every extra conversion is lost money and massive commissions. Moreover, it is possible to significantly reduce costs thanks to the correct configuration of currency accounts and payment instruments. Optimize international payments today: open a Payoneer account in Ukraine and don’t lose your money on conversions! Keep your income and control over your finances. Start saving on your first international transaction by making payments quickly, easily, and securely!

CTA: place a banner to create a Payoneer account for the target audience. Banner text “Payoneer is your easy and secure way to control your international payment costs. Sign up for a Payoneer account today!” and add a button for registration. (or a link to the existing banner, example)

FAQ

What does double conversion mean?

Double conversion occurs when currency is converted twice during a transaction. This can happen when the payment is first converted to one currency (e.g., USD) and then to the recipient’s currency (e.g., UAH).

Why is double conversion unprofitable for business?

Double conversion means additional costs due to double fees (each conversion may have its own fee), less favorable rates, and delays in transactions (additional steps increase payment processing time). These factors reduce the efficiency of financial operations and lead to significant costs for businesses.

How do you find out if there will be a double conversion upon payment?

To determine if there will be double conversion, check the account currency and ensure the recipient’s account supports the payment currency. Carefully read the terms and conditions of the payment platform and check whether it is possible to choose a currency when receiving a payment. You can also contact the support service and clarify whether it will happen on a double conversion on a case-by-case basis.

How to avoid double conversion в Payoneer?

To minimize double conversion, use multi-currency accounts in Payoneer. Payoneer allows you to open accounts to receive payments in more than 70 currencies, and you can store funds in the currency you want without conversions. Then, when needed, convert the currency in advance using the appropriate function in your Payoneer account to exchange the currency before making the payment.

Can double conversion be avoided in popular payment services?

Yes, double conversion can be avoided in many payment services when using multi-currency accounts or when you can specify the currency of your account when receiving a payment.