Where To Exchange Currency At Fair Rates

Your money doesn’t have the same value when switching countries. Whenever you convert to another currency, you’re paying a conversion fee to do it. But some companies take advantage of some situations with the worst rates possible.

Say you just arrived at the airport and need money right away. You can’t find anywhere to trade your currency except for that airport exchange. Because you have no choice, you take the worst rates and move on.

Or perhaps you’re a tourist who doesn’t know anything about the country. The next thing you know is that you lost almost half of your money by “exchanging” it.

Sadly, most businesses set prices based on what people are willing to pay or what they think is reasonable, not what’s fair or best for them. If a client has no idea, then any price range could appear right. And because you can’t find any other stores, they basically monopolize on traveler areas.

Think about your home country. Do you go to the airport whenever you need to exchange? Don’t you go to a local bank office instead? Once you arrive at your destination, wait until you get to the city to convert it.

How To Exchange Currency The Right Way

No matter what method you choose, you’ll never find a 1:1 exchange. Companies make profits from converting currency, and some may charge more “by mistake” unless you point out.

In fact, we recommend you use an exchange you already know rather than trying another one you don’t know— even if yours doesn’t have the best rates.

First, let’s make clear what not to do.

Avoid airport exchanges.

We get it. You just arrived in this new place and have never been to this city before. But that may make you believe that the first place you find is the only spot where you can buy.

So many other tourists thought that. And many more will fall for it every day.

Don’t do it. And learn to avoid such common travel scams.

Don’t convert currency when it’s not needed.

Have you bought lodging or transportation? International brands will accept the primary currencies without requiring conversion, although it may change the price a bit.

If you’re traveling to visit friends and family, you can swap currencies with them. They give you local cash for no conversion fees, and you could send it electronically with your bank or Paypal (you can exchange currencies as you transfer).

Neither pays in cash unless you have other methods available. Can you pay with a credit card? Use it, but learn first about the foreign transfer fees that may apply.

Know the price to compare exchanges.

Comparing exchanges can be deceiving when you haven’t looked at the actual currency price. 

Imagine a few local exchange shops exchange currency A (yours) for 20 of currency B (local). Some may give 15, others 25, but the higher number will look like the best deal, so you convert there.

Later, you find out the actual conversion is 1:40. You just experienced the Availability Heuristic Bias: context changes the whole meaning of the facts.

That’s why comparing prices isn’t enough. Google Currency A and Currency B and see what the proportion is. Anything that’s too far from that is screaming “Scam.”

Exchange electronically, but…

Electronic conversion may take your money in other unexpected ways. Some of which have nothing to do with the exchange.

For example, you just got to the city and found a conversion ATM in that crowded area. You enter your card details, convert currency, and do some shopping. Days later, you find your bank account empty.

That’s because someone may have installed a skimming device in the bank machine. That may not happen in your home country, but when traveling to other places, you never know what kind of crooks you can find.

Here’s another scenario. You’re about to pay at some store or restaurant, but the staff tells you they can only accept their currency. Luckily, you can program some credit cards from your phone to convert those currencies.

So you connect to the free WiFi network, open the app, enter your login details, convert, and pay. Wait, don’t they have a public WiFi connection?

If you weren’t alone in the local area, someone could have created that network to steal other people’s information. Days later, you could find your bank account, again, empty.

Where To Trade Currencies

Let’s look at some safer ways to exchange currencies:

Banks and financial institutions:

Both international and national brands offer fair conversion rates, whether you’re their customer or not. Although you may get a better deal as an account owner, you don’t need one for conversion. It’s like entering a restaurant or supermarket asking to change a few bills for coins.

If you don’t feel like risking your account on a machine, enter the building and ask the staff to do it instead. Even if smaller banks don’t speak English, the conversation shouldn’t be difficult:

“Convert X dollars to {the local currency name}.”

“I don’t have an account at {bank name}.”

Ask an experienced person.

We’re teaching you how to get through the situation by yourself. But most of the time, you can save the effort and ask a trusted person instead. We can 100% guarantee a person you know already has the solution to the problem.

Have you tried asking the hotel staff where to exchange currency? How about friends and family (if they are local)? And the tour guide? 

If you hear another traveler talk your language, there’s nothing to lose if you ask for help. Maybe they’ve traveled here before and can give you some advice. Or perhaps you’re an experienced person and can help them not protect their money.

Different kinds of tourist traps may be all over the place and it pays off to be aware of these.

Order it

If you don’t want to waste your first vacation days worrying about money, do your homework before you travel. If you need a lot, you can order local currency online for no extra fees (most companies waive them when sending over $1000).

It’s not different from a money order. Learn more about what limits and delivery times your bank offers.

Online platforms and exchanges

If you don’t want to deal with your bank or can’t find an office in the new city, online exchanges are your next best option. For electronic payments, you could send your money to exchange (if you don’t have balance yet), convert, and wire transfer to your bank.

Some trading platforms have minimal fees as their selling point, which makes conversions convenient. If you live in the EU, withdrawing could cost a flat 1€ fee with SEPA transfers.

This method may fail if your bank automatically converts foreign to your primary currency for a fee, which isn’t what you want. Ask them how to add more currencies to your bank account.

In case you find another international bank, you could go there too. Make an online wire transfer to their address, and as soon as they receive the amount, they give you the equivalent in local cash.

It’s not the best nor fastest method but works as a last resource.

What We’ve Learned

You won’t lack choices when looking to convert currency. Choose any place but airport exchanges. If you travel with other people, ask them to lend you a hand.

It’s ironic how the worst exchange shops are the most accessible, located in almost every popular area. Maybe because they are the most visible, travelers see them as the best option, ignoring the other ones.

There is only one reason to visit those local exchanges. If they also let you convert money the other way around, you just got a money-printing machine. 

No deal? They just admitted they’re taking advantage of you.

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