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Most bank accounts can’t hold multiple currencies (and they’ll charge high fees for exchanging currencies). But there’s one notable exception: multicurrency accounts.
A multicurrency account, sometimes called a foreign currency account, allows consumers and businesses to hold different currencies in one bank account. They can also send, receive and withdraw money from the account, as with a standard bank account but in multiple currencies.
Here’s what you need to know to determine whether a multicurrency account is right for you.
What is a multicurrency account?
A multicurrency account is a bank account that works with different kinds of currencies. The basic purpose of a multicurrency account is to make it easier for the account holder to process international transactions.
Say you’re someone who frequently does business abroad, but you primarily bank in the U.S. Having separate bank accounts in each country you do business with can get complicated — it involves having to manage multiple accounts and potentially rack up high fees from transfers and conversions.
A multicurrency account, on the other hand, would allow you to make and receive payments from multiple countries in one place. Plus, you have the option to convert those currencies when you want to and take advantage of lower exchange rates.
The exact currencies supported by a multicurrency account will vary from bank to bank. The account will typically hold the most commonly traded currencies, such as:
- U.S. dollar
- Canadian dollar
- Australian dollar
- British pound
- Hong Kong dollar
- Japanese yen
Some multicurrency accounts even come with a debit card, so you can easily shop internationally (in stores or online) and minimize high foreign transaction fees.
Pros and cons of multicurrency accounts
The benefits of a multicurrency account include:
- You can manage money from different currencies in one place, making it easier to track foreign transactions.
- The cost of conversion is cheaper than what you’d pay with other types of accounts, since you can take advantage of the most competitive exchange rates.
- Some multicurrency accounts come with debit cards.
- You can have multiple local account details, such as a European bank code and a U.S. bank account number, so you can receive payments internationally.
- Multicurrency accounts at FDIC-insured institutions are federally protected by up to $250,000 per account holder.
Cons of multicurrency accounts include:
- Multicurrency accounts often have high minimum balance requirements — sometimes $200,000 or more.
- There may be higher maintenance fees.
- If it’s an interest-bearing account, it will likely have a much lower yield than standard savings and money market accounts.
- There may be limited features on the account. For example, it may not come with overdraft protection or a checkbook.
Where to find the best multicurrency account
Many multicurrency accounts are reserved for businesses and only available through private banking services. If you’re a business owner, you can find multicurrency account options at many large U.S. banks, including Citibank, PNC Bank and Wells Fargo.
Multicurrency accounts for the general public can be found at a few banks and fintechs. These accounts may come with lower minimum balance requirements, but they also may be more limited — by not letting you withdraw funds in foreign currencies, for example. Some publicly available multicurrency accounts include:
- TIAA Bank’s WorldCurrency Access Deposit account
- Wise Multi Currency account
- Revolut Multi Currency account
- Payoneer account
Before settling on a multicurrency account, you’ll want to look out for and compare account opening and closing fees, monthly maintenance fees, minimum balance requirements and what currencies are available for conversion with the account.
Other options for international payments
Multicurrency accounts are best for those who make frequent foreign transactions, such as those who do business abroad and expats with foreign expenses.
If you’re making a one-time international transfer or exchange currency on an occasional trip abroad, it’s not necessary to open a multicurrency account. Some other ways to transact between different currencies include:
- International wire transfers: You can usually make an international wire transfer through your bank or a third-party money-transfer service like Western Union. While international wire transfers are quick and allow for large balance transfers, they come with high fees. The average outgoing wire transfer fee, according to Bankrate research, is $44.
- No foreign transaction fee debit and credit cards: A credit card with no foreign transaction fees allows you to make everyday purchases abroad with low currency exchange rates, while a debit card without foreign transaction fees lets you access cash from ATMs at a low cost.
- Xoom: Offered through PayPal, Xoom is an international peer-to-peer payment service that comes with a fixed conversion fee that varies by currency. Money transferred through Xoom to a bank account is typically received by the next business day.
- Wise: In addition to its multicurrency account, Wise also allows consumers to make one-time transfers internationally. You can connect a bank account, debit card or credit card and add the details of the recipient’s bank account to initiate a foreign transfer with a flat fee. The fee varies by currency and payment type (sending by bank account is typically cheapest). Money sent through Wise is available within one business day for the most popular currencies.
Multicurrency accounts are a good option for those who frequently transact in different currencies. They make it possible to process international transactions in one place and allow you to take advantage of lower conversion rates. However, multicurrency accounts may have high minimum balance requirements and/or monthly fees.
If you’re just looking to make a one-time international transfer or convert currency for the occasional trip, consider some other options, such as a no foreign transaction fee credit card or non-bank money transfer services.