There are three cost components to foreign transfers:
1. Exchange Rate Margins
2. Provider Fees
3. Bank Fees
Lets go through each of them to see where all your hard earned money is going...
Exchange Rate Margins
The inter-bank exchange rate is the mid-rate you see on the news each night and is only for reference, these rates are what it costs large banks and currency brokers to buy and sell foreign exchange.
Banks charge huge margins for currency conversion to the majority of businesses and individuals. They tend to fix rates once a day and therefore need to incorporate enough margin to protect against intraday rate volatility.
In addition, the level of price discrimination is extortionate – they get away with it because they can; businesses and consumers have been kept apathetic to using better alternatives.
Our foreign transfer cost calculator makes it easy to calculate how much you are actually being charged from the mid-rate. Each provider's percentage margin is shown in the right column and optionally showing the total rate and fee margin or just the rate margin.
Using your Bank's exchange rates services can be very expensive - often 5% to 6% worse than you can get by using a BER partner vendor.
Provider Fees
Foreign Exchange providers may also charge a fixed or percentage amount determined by the amount of the transfer. Some non-bank vendors will only charge these fees upto a certain limit or have various different fee structures. The calculator below is programmed with these various fee models to make it easy for you to find the best deal for your particular foreign exchange needs.
Next the dreaded Bank Fees.
Bank Fees and other annoying and unnecessary costs
Besides the currency conversion rate there are other fee components to making and receiving international payments, most of which are far from transparent to customers:
_Correspondent bank fees_ : These relate to the network of banking relationships that are utilised to complete an international transfer. Each correspondent bank skims a fee of the transferred amount for simply acting as link in the payment chain. Customers are rarely made aware in advance as to how many correspondent banks are in the chain and what they will charge.
_Landing fees_ : The beneficiary bank will charge a fee for receiving the funds from abroad. Again, these are rarely known in advance and can be substantial – there is no standardised fee. Customers are made aware of a “receiver fee” but not of its magnitude.
_Repair charges_ : Banks will charge a considerable fee to fix an issue relating to incorrect details, such as the BIC code, having been entered as part of beneficiary details. This can be overcome by way of pre-confirmation of payment details, but banks do not usually offer such a service to customers.
_Returned funds fees_ : If a payment needs to be returned, whether instigated actively by you,e.g. a stop payment, or due to insufficient funds or incorrect payment details, the bank will charge a fee to process the return. This can be upwards of $30.
Use a specialist money transfer provider next time you send money abroad
You can avoid getting terrible exchange rates and paying those unecessary bank fees by using one of the money transfer providers listed in the comparison table. These providers can do this by transferring the money internally or where needed using banks that they know won't charge these unecessary fees.
BER articles that mention Foreign transfers:
How to Choose the Best Money Transfer Provider
A comprehensive guide to choosing the best money transfer provider, covering key factors like fees, speed, exchange rates, and customer support, with comparisons of top services such as Wise, OFX, WorldRemit, and XE Money Transfers.
OFX vs Wise: Which Money Transfer Service Is Best For You in 2025
Looking to transfer money internationally? We compare OFX and Wise side by side, covering costs, exchange rates, speed, and features to help you choose the best service for your needs in 2025. Which one is right for you depends largely on how much you’re sending, how often you transfer, and whether you value real-time convenience or personal account management.
Why Online Sellers Should Use an FX Specialist
If you’re selling online internationally, using an FX specialist can save you thousands. Better exchange rates, lower fees, and protection against currency swings can make a huge difference to your bottom line. Find out why smart online sellers are choosing FX specialists to manage their global payments — and how it could help you scale faster.
Further reading on Foreign transfers - Guides, Reviews & News from our research team.
Disclaimer: Please note any provider recommendations, currency forecasts or any opinions of our authors should not be taken as a reference to buy or sell any financial product.