How currency conversion and the FX buffer work
When an invoice currency differs from your billing currency, Flamingo converts at the mid-market rate plus a 1% FX spread, and adds a 1% FX buffer to cover rate movement before settlement. Both are your company’s cost and appear in the payroll preview.
When a contractor invoices in a currency different from your billing currency, the amount must be converted. Two line items can apply — the FX spread and the FX buffer. Both are charged to your company and itemized in the payroll preview.
FX spread
Flamingo takes the mid-market exchange rate and adds a 1% markup, shown as "FX spread" ("markup over mid-market rate"). It applies only when the invoice currency differs from your billing currency — same-currency payments have no FX spread.
FX buffer
A 1% FX buffer is collected as a reserve for rate movement between the time you’re quoted and when the payment settles, shown as "FX buffer" ("reserve for rate movement before settlement").
- The buffer is held as a credit on your account, not a lost fee.
- If the rate moves against the conversion, the buffer absorbs the difference.
- Available credit can offset the non-payout portion of future charges — it never reduces the contractor’s payout.
Rate drift & reconciliation
Flamingo compares the rate you were quoted against the rate at settlement. If the realized rate drifts by more than 0.25%, the difference is reconciled against your FX credit balance.
Where you see it
The payroll preview itemizes the FX spread, the FX buffer, and any FX credit applied, so you see the exact converted amount and costs before confirming.
Note: The contractor always receives the amount quoted to them in their own currency — the FX spread and buffer are your company’s costs, not theirs.
Warning: FX rates and buffer percentages are configurable and may change. The amounts shown in your payroll preview are always the exact figures applied.
Last updated: Jun 2026