Lois Larson
Currency exchange at the airport is a convenient option for travellers who need foreign cash at the last minute. However, it is widely regarded as a bad idea due to unfavourable exchange rates and high fees. It is recommended that travellers who want to get the most value for their money should research currency exchange rates in their city and exchange their money there. Ordering foreign currency from your bank before travelling is also a good option.
| Characteristics | Values |
|---|---|
| Convenience | Airport currency exchange is convenient as it saves time and makes the entire experience more convenient. |
| Shorter lines | The lines are shorter at the airport. |
| Currency availability | Airport exchanges always have foreign currency in stock, unlike banks that may need to order cash. |
| Competitive exchange rates | Airport exchanges have competitive exchange rates. |
| Low fees | Airport exchanges have low fees. |
| Poor exchange rates | Airport exchanges typically offer poor exchange rates. |
| High fees | Airport exchanges may charge higher fees, which are sometimes hidden within poorer exchange rates. |
| Alternatives | It is recommended to use your bank's ATM network, a local ATM, or your bank before travelling. |
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What You'll Learn
- Airport kiosks are convenient but have poor exchange rates and high fees
- Your bank or credit union is likely the best place to exchange currency
- You can order currency from your bank before you travel
- Airport exchange counters have competitive rates and low fees
- ATM cards can be used to withdraw cash in the local currency
Airport kiosks are convenient but have poor exchange rates and high fees
Airport kiosks are convenient, but their exchange rates are poor, and their fees are high. While exchanging currency at an airport saves time and is a guaranteed way to obtain foreign currency, their exchange rates are typically much less favourable than those offered by banks. For example, if your bank offered you an exchange rate of £72 per $100, an airport kiosk may give you only £67 per $100.
The convenience of airport kiosks comes at a cost. They often have shorter lines, and you can exchange money while you wait at the airport. Some kiosks, such as those at Denver International Airport, even allow you to reserve money in advance. However, the exchange rates at airport kiosks are generally the worst you'll find.
In addition to poor exchange rates, airport kiosks may also charge higher fees, which are sometimes hidden within the poorer exchange rates they offer. These fees can add up, especially if you are converting a large sum of money.
To get the most value for your money, it is recommended to plan ahead and exchange currency at your bank before travelling. Ordering currency from your bank ensures that you receive authentic currency and benefit from the best, legal exchange rate. If you don't have time to visit your bank before your trip, consider using your bank's ATM network at your destination. You can withdraw cash in the local currency with competitive exchange rates and low fees (typically 1% to 3%).
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Your bank or credit union is likely the best place to exchange currency
When it comes to exchanging currency, your bank or credit union is likely your best bet for a number of reasons. Firstly, airport kiosks and exchange counters are known for charging higher fees, often hidden within poorer exchange rates. These merchants offer convenience but typically provide much less favourable rates than your bank or credit union. For instance, if your bank offered an exchange rate of £72 per $100, an airport kiosk might only give you £67 per $100, resulting in a significant loss for you.
Secondly, banks and credit unions generally provide reasonable exchange rates and the lowest fees. They may also buy back any leftover foreign currency when you return, which is an added benefit. It is recommended to call your bank's customer service to check if they have the type of currency you need and to place an order if necessary. Some banks may require you to exchange currency in person, in which case you can set up an appointment.
Thirdly, using your bank's ATM network when abroad is often the best option for exchanging currency with minimal fees. You may be able to withdraw cash in the local currency with competitive exchange rates and low fees (typically 1% to 3%). However, it is important to use your financial institution's ATMs or those within their network to avoid unnecessary charges. Additionally, try to withdraw larger amounts to minimise the impact of ATM fees.
Lastly, exchanging currency at your bank or credit union before your trip allows you to plan and receive a better exchange rate. This is especially useful if you are travelling to multiple countries with different currencies. By exchanging currency in advance, you can avoid the hassle of frequent exchanges and take advantage of the security and familiarity of your local area.
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You can order currency from your bank before you travel
Ordering foreign currency from your bank before you travel is a smart way to save money. Airport kiosks are known for offering poor exchange rates and charging high fees, so you'll get less currency for your money.
Most major banks make it easy to order currency online. Typically, you can access the currency exchange webpage through your bank's website or mobile app, or by phone. From there, you usually enter the currency you need, add the desired amount, select the pickup method, and place your order. While you can generally expect a solid exchange rate, it's a good idea to use a trusted source such as Reuters or the International Monetary Fund to find current exchange rates and ensure you get a fair deal. Additionally, understand all the fees involved. For example, Citi charges a $5 service fee for transactions under $1,000, though it's waived for premium account clients. You might also get charged a shipping fee, which you can sometimes avoid by opting to pick up the cash at a local branch. There may also be a minimum amount of foreign currency you can order ($100 or $200 is common) and a maximum ($10,000 within a 30-day period is common).
Ordering currency from your bank before you travel can help you lower the cost of exchanging money and maximize the amount you get in return. You'll also have peace of mind, knowing that you have cash on hand for immediate expenses such as taxis and tips, and you can skip the potentially long airport lines when exchanging currency upon arrival.
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Airport exchange counters have competitive rates and low fees
While airport exchange counters are convenient, they are not known for offering the best currency exchange rates. Their rates are often 10-12% higher than market rates, and they sometimes charge additional fees on top of the poor exchange rate. This is due to the high cost of maintaining a physical presence at airports, including steep rents and operational costs. As a result, travellers exchanging currency at airports may receive fewer units of foreign currency.
However, it's important to recognise that airport exchange counters can be a good option for those who need foreign currency at the last minute. If you're travelling on short notice and need cash at the airport, it could be worth paying the extra cost for the sake of convenience. In this case, it is recommended to have a fair understanding of currency exchange rates at airports so that you can make an informed decision.
Additionally, some major banks have branches at or near airports, and using those ATMs can provide a decent exchange rate while eliminating out-of-network ATM fees. If you have an account with an authorised bank or credit company, you can withdraw cash in the local currency with competitive exchange rates and low fees (typically 1% to 3%).
Overall, while airport exchange counters may offer competitive rates and low fees compared to other options available at the airport, such as airport kiosks, they may not be the most cost-effective option when compared to exchanging currency at a bank or using an ATM.
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ATM cards can be used to withdraw cash in the local currency
When travelling, it's important to have local currency on hand. While you can exchange money at the airport, this is often an expensive option with high fees and poor exchange rates.
A better alternative is to use your ATM card to withdraw cash in the local currency. This can be done at your destination airport, where ATMs are usually available 24/7. However, it is generally advisable to avoid out-of-network ATMs, as you may incur additional fees from your bank and the ATM owner. Instead, use your bank's app to locate an in-network ATM near you. If your bank doesn't have any in-network ATMs or branches in the country you're visiting, you can use your debit card at a local ATM.
It's worth noting that some ATMs may offer you the choice of paying in your home currency. However, it's recommended to always choose to pay in the local currency, as your home bank will handle the currency conversion, typically offering a fair exchange rate. Additionally, ensure that your ATM card doesn't charge foreign transaction fees, as these can quickly add up. Cards from providers like Capital One, Charles Schwab, and Discover are known for waiving these fees.
By following these suggestions, you can conveniently access local currency through ATM withdrawals while avoiding unnecessary fees and unfavourable exchange rates.
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Frequently asked questions
Yes, you can exchange cash at the airport. However, it is not recommended as airport kiosks often have poor exchange rates and high fees.
It is recommended that you exchange currency at your bank before travelling. If this is not possible, you can use your bank card at an ATM when you reach your destination.
Yes, you can also use an online currency converter, such as Currency Exchange International, which will deliver cash to your home. Alternatively, you can use a credit card with no foreign transaction fees.
