> ## Documentation Index
> Fetch the complete documentation index at: https://support.wepayments.com.br/llms.txt
> Use this file to discover all available pages before exploring further.

# Conversion Fee: how automatic charging works for cross-border operations

With the new **Conversion Fee** feature, charges related to cross-border operations are now automatically calculated and registered directly within the transactional flow and the ledger. The goal is to provide more transparency, predictability, and traceability for fees associated with international transactions.

## **Overview**

The Conversion Fee automates the charging of exchange costs and taxes (such as IOF) for cross-border operations, eliminating manual calculations and ensuring that each transaction has its associated costs recorded clearly and linked to the original operation.

| **Benefit**        | **How it helps**                                      |
| :----------------- | :---------------------------------------------------- |
| **Transparency**   | Charges are recorded directly in the ledger           |
| **Predictability** | Costs are calculated automatically, with no surprises |
| **Traceability**   | Each fee remains linked to the original transaction   |
| **Reconciliation** | Consistent ledger, simplifying financial closing      |

## **How does the Conversion Fee work?**

The Conversion Fee is configured as a percentage and applied to the **gross transaction amount**.

### **When configured:**

* The fee is automatically calculated
* The amount is registered in the ledger
* The fee remains linked to the original transaction

### **Calculation formula**

```text theme={null}
Conversion Fee = transaction amount × fee percentage
```

When both Conversion Fee and IOF are configured, the values are added together and reflected as a single charge in the ledger, under the **"conversion fee"** category.

## **Which transactions generate a Conversion Fee?**

The feature applies to eligible cross-border operations, including:

| **Transaction type**    | **Description**                                              |
| :---------------------- | :----------------------------------------------------------- |
| **Payin**               | Receipts via PIX, credit card, boleto, or TED                |
| **Payout**              | Payments sent via PIX or TED                                 |
| **Returns and refunds** | Reversal transactions, which also generate operational costs |

> 💡 Returns are also included, as these transactions generate costs that must be accounted for.

## **How does the Conversion Fee appear in the ledger?**

With the new functionality, a transaction can generate up to **three ledger entries**:

| **Entry**            | **Description**                        |
| :------------------- | :------------------------------------- |
| **Main transaction** | e.g., PIX Payment, Credit Card Payment |
| **Operational fee**  | e.g., PIX fee, card fee, boleto fee    |
| **Conversion Fee**   | Charge related to FX and IOF           |

All entries maintain reference to the original transaction, ensuring complete traceability in statements and reconciliation processes.

<Frame>
  <img src="https://mintcdn.com/wepayments-cdc99ca4/dA71BN8u6dwS-Xxe/images/image-(2)-2.png?fit=max&auto=format&n=dA71BN8u6dwS-Xxe&q=85&s=29145c2641e619f750779cb769a5337b" alt="Image (2) 2" width="1149" height="324" data-path="images/image-(2)-2.png" />
</Frame>

## **Impact on balance**

The fee behavior varies depending on the transaction type.

### **Payin (receiving)**

| **Event**                             | **Impact**                            |
| :------------------------------------ | :------------------------------------ |
| Transaction is credited in the ledger | Conversion Fee is debited immediately |
| Available balance                     | Direct impact on available balance    |

### **Payout (sending)**

| **Event**                      | **Impact**                                                    |
| :----------------------------- | :------------------------------------------------------------ |
| Transaction is created         | System checks if there is sufficient balance to cover the fee |
| Payment successfully processed | Fee is deducted from available balance                        |
| Payment rejected               | No amount is debited – the blocked balance is released        |

> ⚠️ **Important:** You must have sufficient balance to cover the fee when performing a Payout.

## **Practical example**

### **Setup**

* **Company:** International Market Ltd (cross-border)
* **FX Fee:** 2.5%
* **IOF:** 0.38%
* **Transaction:** Payout of R\$ 10,000.00 to a supplier in Brazil

### **Calculation**

| **Component**            | **Calculation**    | **Amount**     |
| :----------------------- | :----------------- | :------------- |
| FX Fee (2.5%)            | R\$ 10,000 × 2.5%  | R\$ 250.00     |
| IOF (0.38%)              | R\$ 10,000 × 0.38% | R\$ 38.00      |
| **Total Conversion Fee** | **Sum**            | **R\$ 288.00** |

### **Impact on the ledger**

| **Entry**                      | **Amount**          |
| :----------------------------- | :------------------ |
| Payout sent to beneficiary     | - R\$ 10,000.00     |
| Conversion Fee (including IOF) | - R\$ 288.00        |
| **Available balance affected** | **- R\$ 10,288.00** |

## **Benefits of automation**

| **Benefit**                   | **Description**                                                |
| :---------------------------- | :------------------------------------------------------------- |
| **Automatic calculations**    | Reduces time on settlement, as all fees were already collected |
| **Financial transparency**    | Ledger with all charges visible and traceable                  |
| **Link to transaction**       | Each fee is associated with the original transaction           |
| **Simplified reconciliation** | More consistent and auditable process                          |
| **Greater predictability**    | Costs known in advance                                         |