Sachin Walls
Currency exchange kiosks at the airport offer a convenient way to exchange money before or after your trip. However, they typically offer poor exchange rates, and you may be better off exchanging your money at a bank or ATM, either before you leave or once you arrive at your destination.
| Characteristics | Values |
|---|---|
| Convenience | Currency exchange kiosks and counters are conveniently located within airport terminals, making them easily accessible just before departure or immediately after landing. |
| Exchange rates | Airport currency exchanges often offer poor exchange rates. |
| Alternatives | Ordering currency from your bank before travelling is often a better option. Using a credit card with no foreign transaction fees is also recommended. |
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What You'll Learn
Airport currency exchange rates are often poor
Firstly, airport currency exchanges typically offer unfavourable exchange rates. They may charge higher fees due to their convenient location within airport terminals, targeting holidaymakers and international travellers who need quick access to local currency. In some cases, the exchange rate spreads at airports can be significantly higher than the wholesale rate, resulting in an expensive markup for customers.
Secondly, there are usually more retail currency exchanges available beyond the airport, and these locations often provide better rates. Exchanging currency in the city, away from tourist attractions, can result in more competitive rates.
Additionally, it is worth exploring alternative options before resorting to airport currency exchanges. Ordering foreign currency from your local bank before travelling is often recommended, as banks may offer better exchange rates and lower fees. Major banks often have branches abroad or partnerships with other banks, allowing you to withdraw cash from ATMs with decent exchange rates and without incurring out-of-network ATM fees.
Furthermore, using a no-foreign-transaction-fee credit card for purchases while travelling can be a more cost-effective alternative to exchanging currency. Credit cards often offer fraud protection, and in the event of loss or theft, they can be replaced, unlike cash.
While airport currency exchanges offer convenience, travellers should be aware of the potentially poor exchange rates and consider alternative options to make informed decisions that balance convenience and cost-effectiveness.
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Alternatives to airport currency exchange
Airport currency exchange counters are known for offering unfavourable exchange rates and charging higher fees, which can cut into the money you get to spend on your trip. Here are some alternative ways to get foreign currency before and during your trip:
Order from your bank:
Ordering currency from your bank before you travel is often a better option than using airport exchanges. Many banks allow you to order foreign currency online, by phone, or in person, and you can usually pick it up at a local branch or have it shipped to your home. Banks typically offer better exchange rates than airport kiosks, and you can check the current rates to ensure you're getting a good deal.
Use your bank's ATM network:
When you arrive at your destination, using your bank's ATM network to withdraw cash in the local currency is often a good option. This can provide competitive exchange rates and low fees (typically around 1% to 3%). Using your bank's app can help you locate nearby in-network ATMs, and withdrawing larger amounts can reduce the impact of any ATM fees.
Apply for a no foreign transaction fee card:
If your destination is card-friendly, consider applying for a credit or debit card that doesn't charge foreign transaction fees. This can help you avoid the extra fees associated with exchanging cash, and these cards often come with fraud protection and safety features, making them a safer option than carrying large amounts of cash.
Exchange larger amounts at a local currency exchange store:
If you need to exchange money while abroad, consider using a currency exchange store away from tourist areas, as these may offer better rates than airport kiosks. Exchanging larger amounts can also help reduce the impact of any unfavourable rates or fees.
Remember to plan ahead and compare exchange rates to ensure you're getting the most out of your money, leaving you with more to spend on your trip.
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Pre-ordering currency from your bank
Exchange Rates and Fees
When pre-ordering currency from your bank, you can generally expect competitive exchange rates. However, it's advisable to compare the bank's offered rate with current exchange rates provided by trusted sources, such as Reuters or the International Monetary Fund (IMF). This comparison ensures that you're getting a fair deal. Additionally, some banks may charge fees for currency exchange services, so it's important to understand all the associated costs. These fees can include service fees, shipping fees, or minimum order requirements.
Ordering Process
Most major banks allow customers to order foreign currency through their websites or mobile banking applications. Typically, you access the currency exchange platform, select the desired currency, specify the amount, and choose your pickup method. Some banks may offer the option to have the foreign currency shipped directly to your address or provide pickup at a local branch. It's important to plan ahead, as ordering and shipping currency may take several business days.
Account Requirements
In most cases, you'll need to have a valid bank account with the financial institution to utilise their currency exchange services. For example, Bank of America offers foreign currency exchange to its account holders, allowing them to order online or visit a financial centre for the exchange. Similarly, U.S. Bank requires customers to have a U.S. Bank deposit account to order foreign currency through their mobile app or online banking platform.
Timing and Availability
When pre-ordering currency from your bank, it's essential to allow sufficient time for processing and shipping. Some banks have specific cut-off times, such as placing orders before 2 p.m. local time to ensure same-business-day shipping. Additionally, it's worth noting that banks may have minimum and maximum order requirements for foreign currency exchanges. For instance, Bank of America has a minimum order value of USD $1,000 for pickup at a financial centre, and common maximum limits are around USD $10,000 within a 30-day period.
Loyalty Programs and Benefits
If you're a member of a bank's loyalty program, you may be eligible for benefits when pre-ordering currency. For instance, Bank of America Preferred Rewards program members can receive discounts on the exchange rate and waived standard shipping fees. It's worth checking if your bank offers similar perks to its loyal customers.
By following these guidelines and planning ahead, pre-ordering currency from your bank can be a convenient and cost-effective way to obtain foreign currency for your travels.
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Using a credit/debit card instead
Currency exchange counters at airports generally offer the worst exchange rates. It is recommended to use a credit or debit card instead, but there are some things to keep in mind.
Firstly, check with your bank about foreign transaction fees. If your card charges these fees, consider getting an account with a card that doesn't. When paying with your card, always choose to pay in the local currency to avoid dynamic currency conversion (DCC) fees, which can be as much as double the basic currency exchange fee. Using a card that doesn't charge foreign transaction fees and avoiding DCC, you will usually get a better exchange rate than with cash.
If you need cash, it is generally better to withdraw from an ATM at your destination than to exchange cash at a currency exchange kiosk, as you will get a better rate. However, be cautious when using ATMs due to the potential for fraud and other criminal activity, and use them only during business hours inside a bank, supermarket, or large commercial building. Also, be aware that fees for using your debit card to withdraw money from ATMs can be high, so try to minimise them by withdrawing larger amounts less often.
If you need foreign currency before you arrive in the country, you can order it from your bank, but this may incur shipping fees and have minimum and maximum order amounts. You can also get traveller's cheques from your bank, but these are not widely accepted and have poor rates and fees.
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Currency exchange outside the airport
Currency exchange counters at the airport generally offer the worst exchange rates. They may also charge higher fees, which are sometimes hidden within the poorer exchange rates they offer. If you need cash upon arrival, it may be worth paying the extra cost for the sake of convenience. However, if you can plan ahead, it is best to avoid airport kiosks and exchange counters.
Ordering currency from your bank before you travel is almost always better than using the airport currency exchange. Most banks allow you to order foreign currencies, which you can typically pick up at a local branch before your trip. Some banks may even ship the currencies to you, and sometimes they don't even charge extra for postage if you order a certain amount. Bank of America, for example, offers exchange rates that are roughly 6% more than the IMF rates and less than half of what airport currency exchanges are charging.
ATMs are another option for exchanging currency. They tend to offer competitive exchange rates, and you can save on ATM fees by withdrawing larger amounts. If you're outside of your home country and need the local currency of another country, try visiting a large bank to exchange your cash.
If you need foreign currency before you arrive in the country, you can order some from your local bank, but be sure to give them enough lead time. You can also change a small amount of money at the airport and then do the rest once you're more familiar with your surroundings.
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Frequently asked questions
Yes, you can exchange currency at the airport. Currency exchange kiosks and counters are conveniently located within terminals, making them easily accessible just before departure or immediately after landing.
Exchanging currency at the airport is beneficial if you are short on time or have not had the opportunity to exchange currency in advance.
Currency exchange counters at the airport generally offer poor exchange rates. You may also be charged shipping fees for ordering currency, although some banks may waive these fees for loyal customers or those who opt for pick-up at a local branch.
You can exchange currency at a bank, credit union, or online currency exchange bureau. You can also withdraw local currency using your credit or ATM card at an overseas ATM.
Ordering currency from your bank before travelling is often cheaper than using airport currency exchanges. You can also avoid shipping fees by opting to pick up the cash at a local branch. Using a no-transfer-fee credit card is also a good way to avoid fees.
