Transferring Money Internationally: Local or Foreign Currency?
When you transfer money internationally or use ATMs in a foreign country, the card machines will be nice and polite to you. “Welcome to our bank. We offer conversions to your local currency or foreign currency. Easy. Fast. Secure.”
Never ever fall for this kind of advertisement. The service may be all that it claims to be- easy, fast, and secure. However, the money you transferred or received via transfer will be lesser than you expected.
When you transfer money internationally, the cost of sending and receiving it depends greatly on the fees charged by the providers and the exchange rates which vary per company and state, and fluctuates very frequently. Exchange rates is a rate which shows how much of one’s currency is worth in another currency. These rates change daily depending on the performance of the state globally.
Aside from this, ATM and card machines will offer their Dynamic Currency Conversion service. This service encourages automatic conversion from your local currency to the foreign currency. Simply put, you are asking a foreign ATM or bank to charge at any exchange rate they may deem fit for your situation. You will be at the mercy of that foreign bank. Hence, you should refrain from using this service.
The top 2 currencies in the Eurozone are the Euros and British Pound Sterling. The Euro is used in the following countries:
- Portugal and Madeira
- Republic of Ireland
The British Pound Sterling, on the other hand, is used in:
- United Kingdom
- Northern Ireland
Know the exchange rates on these currencies first before you opt for either your local currency or foreign currency when transferring money.
Tips for travellers
Exchange to foreign currency before you travel
Exchanging your money before boarding the plane will let you avoid costly airport fees and other money exchange fees. Choose a reliable, dynamic financial services provider to get the best deal for your exchange. Moreover, exchanging money for foreign currency prior to your date of travel will give you more time to study the fluctuating exchange rate. This way, you will surely get a good rate and not be at the mercy of a foreign bank.
Should you really need to exchange for foreign currency while at a foreign state, stay vigilant? Language barriers are often used by local money changers to confuse tourists. Double check the money you will receive at all times.