What occurs to make a currency conversion necessary?

A currency conversion becomes necessary when the presentment currency—the currency in which a transaction is displayed to the customer—differs from the settlement currency, which is the currency in which the funds are ultimately received by the recipient. This situation often arises when a customer makes a purchase on a platform that operates in a different currency than their own.

In such cases, the financial system needs to convert the amount from the presentment currency into the settlement currency. This conversion ensures that the merchant receives the correct funds in their designated currency, and the customer is charged the appropriate amount, reflecting any exchange rates or conversion fees that may apply.

The requirement for a currency conversion hinges primarily on the mismatch of the currencies involved in the transaction, thus rendering this scenario as the correct choice.