In international trade, currency is an important thing that goes with product price, defining the exact price of products. To avoid mistakes in setting up prices in Magento 2, you should clearly understand 3 definitions belonging to Magento currency configuration: base currency, default display currency and allow currency.
*Useful tip: Read this article to get everything about Magento in hand – Everything You Should Know about Magento.
Base Currency in Magento
Base currency is a Magento currency set up as default in the backend and is used in setting product prices in the backend. It only can be set at global/ website scope and applied for all stores/ store views. It means that admins are not able to set up base currency for each store view. For example, on website X, the base currency is $, price of the product Joust Duffle Bag is 50. So, in all stores/ store views belonging to websites X, the base price of this product is $ 50.
This currency will be used when customers check out and finish the payment.
Default Display Currency in Magento
Default Display Currency in Magento is used to display with product prices in the frontend. It is independent of the base currency. The admin can set up default display currency for each store view so that the price in each store view can be displayed in frontend with different currencies.
In case the default display currency of a store view is the same as the base currency of the website, the price displayed in frontend will be the same with the price set up in the backend.
In case, the default display currency of a store view is different from the base currency of the website, the price displayed in frontend will be defined by Magento currency rate with the formulate:
Display price = Base Price x Currency Rate
– The base currency of website X is $. The base price of the product Joust Duffle Bag is 50.
– Store view French on website X has € as default display currency.
– Currency rate is 1$= 0.5 €.
In this case, display price in the French store view is 50 x 0.5= 25 €.
Remember that currency rate only can be set up at global scope. It can be set up manually or imported via the third-party provider such as Yahoo Finance Exchange, Webservice…
When customers pay for the orders, base price with base currency will be applied rather than display price.
Allowed Currency in Magento
Allowed currency is a kind of Magento currency that is allowed to use in global/website/store/store view depending on scope configuration. It can be used as the base currency in global/ website scope or as default display currency.
If currency rate is set up corresponding with each allows currency, allow currency will be displayed in frontend with default display currency. Users can switch among these allow currencies and price will change based on currency rate (Magento 2 currency conversion).
How to Set up Magento Currency
Set up scope for base currency
Go to Store ⇒ Configuration ⇒ Catalog ⇒ Catalog ⇒ Price ⇒ Catalog Price Scope, select Global or Website.
However, there is an issue that Magento 2 default supports setting up Website scope for base currency. If you want to set up the base currency at the level store view, let’s take a look at a potent tool, which is one of the Magento 2 extensions of BSS Commerce Store.
CAN’T WAIT TO CHECK Magento 2 Multiple Store View Pricing extension to set up store view base currency.
Set up currency
Go to Store ⇒ Configuration ⇒ Currency Setup ⇒ Currency Option.
– Select Base Currency for global/ website scope
– Choose store view and set up Default Display Currency/ Allow Currency for each store view as wish.
You cannot select the base currency for each store view which is a drawback of Magento default. However, it is easily overcome by using an assisted module called Multiple Store View Pricing.
Set up currency rate
Go to Store ⇒ Currency ⇒ Currency Rate.
In conclusion, in default Magento 2, the base currency is set up to manage price in the backend while display currency and allow currency are used to show prices in the frontend. Base currency only can be set up at global/ website scope while display currency and allow currency can be set up for each store view. We can adjust the relationship between these kinds of Magento currency through the currency rate (Magento 2 currency conversion).
The drawback of Default Magento 2
There is a problem that when customers check out, base price with base currency will be applied to calculate the final price. It means currency for check-out is fixed in all store views as the base currency. It may lead to inconvenience for customers because they must use an unfamiliar currency if the base currency is not their local one.
For example, a French customer can see product price with Euro currency in the French store view, but he must check out with price in dollar currency.
How can we get rid of this problem? Do you think about a solution that allows customers to checkout with Display currency of the current store views that customers are selecting?
We would like to suggest Checkout with Display Currency for Magento 2 Extension that helps your customers to checkout with their currency corresponding to store views. This module will overcome the default Magento that forces customers to the only checkout with the base currency of the whole website. Therefore, customers now don’t need to worry about currency rate fluctuation or rate differences between countries. They can pay with their currency conveniently ever.
You can see the following example: Euro is set up as display currency of French store view in the admin. We add a product to cart in the English store view and go to checkout. The currency is used to check out now is Euro (display currency of French store view):
Moreover, you can quickly checkout with display currency of store view via online payment methods supporting multiple currencies such as Paypal, Credit Card, …
Base currency and Display currency are two critical factors for a Magento site, especially a website including multiple stores or multiple store views. Therefore, once you get a complete understanding of these Magento terms, you can use it to operate your business more efficiently.