How to Use This Tool
Enter the amount and the real mid-market rate, then each provider's fee and either the rate they quoted or the margin as a percentage. The only comparable number is what arrives.
Where the money actually goes
Two costs, disclosed very differently:
- The fee. A flat charge, on the receipt, easy to compare. It is also usually the smaller number.
- The exchange-rate margin. The provider quotes a rate worse than the interbank mid-market rate and keeps the difference. It appears nowhere as a charge, because in accounting terms it is not one — they simply sold you currency at their price.
On a 5,000 transfer with a 25 fee, the margin applies to the 4,975 left after it. A 0.5% margin costs 24.88, almost exactly matching the fee. A 2.5% margin costs 124.38, five times the fee. At 20,000 that same margin costs 499.38, twenty times it.
So which cost dominates depends entirely on size. The two are equal at 1,000 for these figures, and above that the margin runs away. Anyone comparing providers on fees alone is comparing the wrong number.
How to find the mid-market rate
It is the midpoint between what banks buy and sell at, and it is the rate shown by search engines and financial data sites. Nobody sells retail currency at it — that is normal, and how far from it you are told is the entire question.
Once you have it, the margin is one division:
margin = (mid − quoted) ÷ mid × 100
A quoted 1.21875 against a mid of 1.2500 is a 2.5% margin. This tool accepts either form, because providers disclose it in whichever way flatters them.
"No fee" usually means a wider margin
A zero-fee transfer is not free, it is priced differently. The provider still needs a return, and with the visible charge removed the margin carries all of it — often more than the fee would have.
In the example above, a bank advertising no fee at a 3.2% margin costs 160 on a 5,000 transfer, against 149.38 for a competitor charging 25 with a 2.5% margin. The one that looks free is the more expensive, and 13.28 less arrives.
The costs neither number covers
- Intermediary bank charges. A traditional wire may pass through correspondent banks that each deduct a charge in transit, so the amount arriving can be less than any quote. Sending with charges marked "OUR" rather than "SHA" avoids it, at a price.
- The receiving bank's fee, often charged in the destination currency and frequently a surprise to the recipient.
- Weekend and holiday rates. Some providers widen the margin when markets are closed, because they are carrying the risk until they can trade.
- Speed. Same-day delivery is often a separate premium.
Ask for the amount that will arrive in the destination currency, as a single figure. That is the only quote that cannot be reframed, and any provider unwilling to give it has told you something.