Fees for converting currency are built into the exchange rate and can be worked out as a percentage from the mid-market. What do currency brokers do? Better exchange ratesĬurrency brokers offer better exchange rates than banks because they buy and sell currency on their client’s behalf closer to the live interbank rate. Personal service and advice on market timing.
Lock in exchange rates with currency forward contracts.Same day international payments for sending money abroad.Better exchange rates than bank accounts.The key services that currency brokers offer are: Currency exchange specialists – converting physical cash currency.Foreign exchange brokers – speculation on currency movements.
Money transfer firms – small international transfers. Currency brokers – large international transfers. The key differences between the different types of service are: For example, sending £100,000 to Euros through a high street bank account may cost £4,000 in fees built into the exchange rate, whereas a currency broker would be able to facilitate the transaction for less than £300 in fees.Ĭurrency brokers are often confused with money transfer companies, foreign exchange brokers and currency exchange specialists. This is because high street bank accounts such as NatWest and Barclays do not differentiate between small currency conversions and large ones, and give the “tourist exchange rate” for all transactions.Īs currency brokers specialise in larger transactions and buy and sell currency at or very near to the interbank rate, they can offer much more competitive exchange rates than “normal” banks. Private clients are now more aware that high street banks can charge up to 4% of currency conversion in fees for international money transfers. But in recent years, with the advances in fintech, currency brokers have become more popular. 1998) were some of the first firms to offer currency brokerage to business and private clients. Currency Brokers ExplainedĮarly currency brokers like Currencies Direct (est. Specialist currency brokers also offer added value services such as same-day international transfers, forward contracts to lock in a currency exchange rate for a transaction in the future, and advice on how and when to convert currency at the best price. Currency brokers enable customers to save money on foreign exchange transfers, especially when compared to standard bank accounts. A currency broker converts large amounts of money into foreign currency and transfers it abroad.
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