With the best money transfer companies, you can reduce business currency exchange fees on your next business trip.
Business currency exchange services help travelling employees access the money they need for international excursions. Yet getting a hold of funds comes with a raft of foreign transaction fees and hidden charges if you’re not careful.
In this blog, we’ll explore the best cash, cards and digital alternatives for work-related travel. Read on for a closer look at business exchange rates, business travel cards, and how to find the best money transfer companies.
Euros, pounds dollars, or yen – when travelling abroad for business, you’ll need to be prepared for different currency rates and fluctuations. Whether you’re covering travel expenses with cash or corporate card, the funds will be taken in local currency, at the current exchange rate. For example, if today’s GBP to USD exchange rate was 1.26, you’d receive $1.26 for every pound exchanged.
You can exchange cash either in person or online. In-person venues include airports, post office, banks, hotels, and travel agent’s money exchange services.
Business exchange rates vary slightly between providers. Many of the best money transfer companies operate online, allowing business travellers to shop around for advantageous rates before ordering a lump sum for travel.
For cash top-ups during your business travels, you can visit locations like:
Yes, in most cases you’ll need to show an ID (usually your passport) to exchange money. This is done as part of money laundering checks.
Carrying large amounts of cash can be inconvenient and unwieldy, which is why many businesses prefer travelling employees to use cards or money transfer apps instead. These make expenses easier to track, and often give access to more favourable exchange rates using real-time market figures.
International banking solutions like Wise, Revolut, and Airwallex are convenient tools for business travellers. These allow account holders to transfer and receive funds across borders, with remote management via the provider’s app.
With tools like these, you can create separate accounts for each supported foreign currency, transferring funds from one currency to another within the app at real-time exchange rates. This saves both time and money on the road.
Exchange rates don’t just move from one day to the next. The fluid, and sometimes volatile, foreign exchange market (Forex) means these rates can fluctuate throughout the same day, even minute by minute. Economic and political events influence business exchange rates, as do factors including the time of year and demand.
The best money transfer companies use real-time exchange rates, and you can check online to see if you’re getting a good deal or not.
That depends on whether the rates are favourable at the time of your currency exchange. If you’re exchanging cash, doing so ahead of time gives you greater control over rates and fees.
However, if you’re using a digital money transfer tool like PayPal, Wise or Revolut, you have more freedom over the timing of your transfer payments. Top up your home currency account with the allocated budget for your journey. Then, simply transfer funds between currency accounts as needed, keeping an eye on exchange rate fluctuations.
Visa and Mastercard are the world’s largest payment processing networks, which means your cards will work overseas with no need to exchange money in advance. Simply use the card as you would for expenses at home. You’ll also save on ATM withdrawal fees by using your business travel card for expenses, though it’s important to be aware of foreign transaction fees.
Planning ahead means you’ll be able to get the best business currency exchange rates. This not only means shopping around to compare current conversion rates, but also considering your timing to optimise the budgeting process.
Here are a few of the prime factors to consider when it comes to business currency exchange rates.
The foreign exchange market is driven by supply and demand. Peak travel times bring greater demand for travel money, especially to popular travel destinations. If you’ve a conference planned for the summer, consider exchanging currency a few months ahead of time to save. Similarly, exchange rates tend to be more favourable mid-week compared to peak weekend travel times.
Markets react to political changes, including elections and times of social turbulence. A country’s currency might fluctuate more widely post-election, settling down after several months.
Countries with higher levels of economic stability will have more predictable business exchange rates. Everything from inflation to interest rates have a direct impact on currency and its perceived value. Finance managers should keep an eye on the latest market trends to purchase pre-paid travel cards during stable periods.
In addition to watching market trends in your travel destination, consider the strength of your home country’s currency in comparison to your destination currency. For example, if you live in the USA and the dollar is strong, this gives greater buying power abroad.
Yes, you can expect to pay a fee to use this type of service, though the type and value will vary. Some providers charge a flat fee per transaction, while others will charge a percentage of the total currency amount exchanged.
Currency conversion fees are separate to foreign transaction fees. These are charged by banks and credit card companies on any purchases made in foreign countries. These might apply when you:
There are several ways to minimise these costs. The first is to use digital wallets like Google Pay or Apple Pay for competitive transfer rates.
The second is to use online banking solutions like Revolut, which come with real-time exchange rates and unlimited account transfers when you sign up for a multi-currency business account.
If you’re exchanging cash, locations like airports and hotels are well-known for charging higher fees. Shop around to find the best deals, not only in terms of currency exchange rates, but also transaction fees.
Whether you’re using a money transfer app, a travel agent’s money exchange or business travel card, read the fine print first to reveal hidden fees. Some card providers will charge an inactivity fee if you don’t use the funds, for example.
As any finance team knows, planning (with a detailed checklist) and saving go hand in hand.
You won’t know how much currency needs to be exchanged without an accurate, detailed business travel budget. Use travel management tools like Booking.com for Business to compare the costs of flights, accommodation and car rental ahead of time, then think about per diem rates for meals and miscellaneous costs.
Many banks have dedicated currency exchange services for their corporate clients, offering lower fees as incentives for bulk transactions. Consider outsourcing your currency needs to an account manager who can monitor market trends and get the very best rates.
They’ll also be able to advise on digital offerings, as many banks have dedicated apps for international money transfers.
You probably already use your phone for contactless payments at home, and this works equally well overseas with foreign currency.
Here are the best apps to simplify currency exchange:
Prepaid corporate travel cards are a popular choice for businesses. You can issue prepaid business travel cards to team members, loaded with enough travel money in the local currency to cover their daily expenses. These can be used as any regular debit or credit card would, at cashpoints, shops, restaurants.
Because cards are purchased in advance, they give the benefit of a fixed exchange rate and greater spend control.
If the itinerary involves several destinations, multi-currency cards are a great option. Providers like Wise give separate currency wallets in a single account that can be topped up with euros, US dollars, and other currencies as needed.
Credit cards are a convenient option for business travel, as they’re widely accepted and secure. Yet these do come with an added foreign transaction fee on top of the usual currency conversion fee.
Foreign transaction fees typically cost 2% to 3% of your total purchase, which quickly adds up to inflate your business travel budget. At a rate of 3%, you’d be spending an additional £30 on top of every £1000 allocated to travel expenses. This understandably will leave you wondering how to avoid foreign transaction fees, if possible.
The best way to avoid foreign transaction fees is with a fee-free credit card. Foreign transaction fees are charged by the payment processor, like Visa or MasterCard, but it’s the card issuer’s choice whether to pass this fee on to the consumer or not. Banks like NatWest, Barclay’s, Wells Fargo, and Chase all have cards without foreign transaction fees. So, if you’re wondering how to avoid foreign transaction fees, just ask your bank or use a money comparison website.
You’re more likely to get the best exchange rate from an electronic payment card, particularly if you use a prepaid, fee-free option. Credit cards offer better security, as they come with consumer protection, and cash comes with the added risk of being lost or stolen.
However, in some countries cash is still king. When cards aren’t accepted, you’ll need the local currency on hand to tip hotel staff, pay street vendors, and take taxis to your destinations.
The best option is usually to take both. Use a corporate travel card for major expenses, and some cash for incidentals.
While we can safely say you’ll spend more at your hotel desk or airport, there’s no one-size-fits-all solution for business currency exchange. Everything from the global economy to local elections can disrupt exchange rates.
Yet by employing the strategies above, you can minimise costs for your organisation. Take currency exchange rates, foreign exchange fees, per-transaction fees, and current market conditions into account. Use digital tools to compare your options and work the cost of currency exchange into any budget for total control over business travel payments. With a combination of online banking apps, corporate travel cards and local currency, your team will be covered for all eventualities.
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