Currency conversion International Drop Shipping (India To US & Other Country)

[bizzguru73]

Hi, How does it work when targeting other country customers (eg: US/UK/China) in dropshipping using a shopify store setup in India, where the currency conversion rates are different. Assuming I've a bank account in India mapped. When the customer pays in $ how does it get translated to my account and when I pay the seller, how will I make a payment in $ while my country's currency in Rupee. Is it treated as Export/Import?

Can I just use bank's Current Account in India to keep track of the business transactions or do I need to open an International current account transaction with the bank in India. 

[Transcy · Accepted solution]

Hello @bizzguru73 ,

We are Transcy - a powerful translator and currencies converter.

Firstly, if a customer pays in a currency that is different from your home currency, such as the US Dollar, the payment will be converted into your home currency using the current exchange rate. This conversion is usually done by the payment gateway that you are using, such as Shopify Payments or PayPal. The converted amount will then be deposited into your bank account in India.

However, it is important to note that some payment gateways may charge additional fees for currency conversion, so it is important to check the terms and conditions of the payment gateway you are using.

When it comes to paying your suppliers, you will need to pay them in their local currency, such as US Dollars or British Pounds. This means that you will need to make currency conversions for each transaction. There are several ways to do this, such as using a third-party currency exchange service or using a multi-currency bank account.

In terms of taxation, it is likely that you will need to pay taxes on any profits that you make from dropshipping, regardless of whether you are selling to customers in India or other countries.

And yes, you can use your regular current account in India to keep track of your business transactions, including those in foreign currency. However, it is important to check with your bank to ensure that they can process and convert foreign currency transactions.

Hope these can help. If so, please hit the Like Button or mark this as Accepted Solution to let us know, it means a lot to us.

Regards,

Transcy team.