Jazmin Li
Airports are a convenient place to exchange foreign coins and currencies, especially if you're short on time before a trip. However, it's worth noting that airport currency exchange services often offer poor exchange rates and charge high fees. If you're looking to get the best value for your money, it's recommended to compare rates and fees ahead of time and opt for alternative exchange methods, such as using a foreign ATM or your bank's ATMs overseas. In some cases, exchanging currency at your local bank or credit union before travelling can also result in better rates and lower fees.
| Characteristics | Values |
|---|---|
| Convenience | Currency exchange at the airport is convenient, especially if you are short on time before your trip. |
| Safety | Currency exchange at the airport is considered a safe option. |
| Exchange rates | Exchange rates at the airport are generally poor and may result in losses of up to 15% of the cash exchanged. |
| Fees | Currency exchange at the airport may involve high fees and additional charges. |
| Alternatives | Using a multi-currency card, foreign ATMs, or your bank's ATMs overseas are often more cost-effective options. |
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What You'll Learn
Currency exchange options at airports
Currency exchange at the airport is convenient, especially if you are pressed for time before your trip. Most major airports offer several currency exchange options, including over-the-counter services, online pre-orders, and ATMs. However, it is important to note that airport currency exchanges often come with high fees and unfavourable exchange rates, which can result in significant losses for travellers.
Over-the-Counter Service
Currency exchange booths or kiosks at the airport offer the convenience of exchanging money on the spot. You can pay in cash or with a card and receive your foreign currency immediately. However, this option can be expensive due to high fees and uncompetitive exchange rates.
Online Pre-Order
Some currency exchange providers allow customers to order their foreign currency online and collect it at the airport. This option may offer a better exchange rate compared to on-the-spot exchanges, and you can be sure that the exchange office will have the currency you need.
ATMs
Using an ATM at the airport is another option for obtaining foreign currency. This method can offer a fair exchange rate, and ATMs are usually readily available. Using a foreign ATM or your bank's ATMs overseas is often recommended as a cost-effective way to obtain local currency.
Other Considerations
When exchanging currency at the airport, it is essential to understand the regulations and rules. You may need to present an airline ticket or your passport, and there may be limits on the amount you can convert. Additionally, exchange rates can fluctuate, and airport exchange rates may differ significantly from the mid-market rate due to added fees. As such, it is advisable to compare rates and consider alternative options, such as using a multi-currency card or exchanging currency through your bank or a reputable online bureau before travelling.
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Over-the-counter services
While airport currency exchange counters are convenient, they are often not the best option for exchanging money. Airport kiosks tend to offer less favourable exchange rates and higher fees than other services. For example, if you're travelling to the United Kingdom and your bank offered an exchange rate of £72 per $100, an airport kiosk may only give you £67 per $100.
If you're travelling at short notice and need foreign currency, it may be worth using an airport exchange service for the sake of convenience. However, if you can plan ahead, it's recommended to avoid airport kiosks and exchange your currency before your trip. You can do this by ordering foreign currency from your bank, which is almost always better value than using an airport exchange. Most major banks allow you to order foreign currency online, by phone, or in person at a local branch. While you can generally expect a solid exchange rate, it's worth checking current exchange rates with a trusted source such as Reuters or the International Monetary Fund to ensure you get a fair deal.
If you're unable to exchange currency before your trip, there are other options available when you arrive at your destination. You could pay with your credit or debit card, although this may incur foreign transaction fees of up to 3% on every purchase. Alternatively, you could use an ATM to withdraw cash in the local currency, although you should be aware of any ATM fees.
When you return home from your trip, you can exchange any leftover foreign currency back into your home currency. Many banks offer this service for their clients, although some may only accept a limited number of currencies and usually charge a fee. Another option is to use a currency exchange service, some of which offer a "buyback" program that allows you to sell back your unused foreign currency for a better rate or lower fee.
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Online pre-ordering
Ordering foreign currency online before you travel is a good way to avoid the poor exchange rates and high fees often associated with airport currency exchange services.
Most major banks offer online currency exchange services, allowing you to order foreign currency through their website or mobile app. Typically, you enter the currency you need, the desired amount, and the pickup method, which may include having the money sent to your home address or picking it up at a local branch.
For example, Bank of America customers can exchange foreign currencies online, but only on orders of $1,000 or more. Otherwise, the bank charges a $7.50 delivery fee for foreign currency orders. Citi also offers online currency exchange, with a $5 service fee for transactions under $1,000.
Online currency exchange services are generally safe, especially if they are offered by a bank or credit union. However, it is important to research the service beforehand to ensure it is reputable.
In addition to online currency exchange, you can also pre-order foreign currency in person at a local bank branch. This option may allow you to avoid shipping fees, and you can often pick up the currency before your trip.
By ordering foreign currency online or in person before you travel, you can take advantage of better exchange rates and lower fees compared to airport currency exchange services. This can help you maximize your spending money and avoid the hassle of exchanging money at the airport.
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Using ATMs
Before your trip, it's a good idea to check with your bank to see if they have ATMs or banking affiliates in your destination country. Using your bank's ATM network or partner ATMs can provide decent exchange rates and help you avoid out-of-network ATM fees.
When you arrive at your destination, consider using an ATM within the airport to withdraw cash in the local currency. This can be a better option than exchanging currency at airport kiosks, which often offer poor exchange rates and high fees.
Keep in mind that there may be daily withdrawal limits set by your bank or the foreign ATM network, so plan ahead to ensure you have enough cash during your trip. Contact your bank to understand any fees and limits associated with foreign ATM withdrawals.
Additionally, some countries have restrictions on their currency due to political or economic issues. In such cases, you may only be able to exchange currency at specific banks and ATMs within those countries.
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Exchange rates and fees
Exchange Rates
Exchange rates fluctuate constantly, depending on changes in global markets. The rate to look out for is the mid-market exchange rate, which is the one you’ll see on Google or with a currency converter tool. This rate indicates how much foreign currency you will get for one unit of your local currency. For example, if the exchange rate is $1 / R18, you will get R18 for every $1 you exchange.
Fees
When exchanging money, you may be charged fees on top of the exchange rate. These fees can be included in the exchange rate or charged separately. They may be called commission or administration charges. At airport exchange offices, an extra percentage fee is often added to the rate used for conversion, increasing the overall cost.
Where to Exchange Currency
Banks
Banks usually offer convenient and inexpensive currency exchange services. However, some banks will only exchange currency for account holders, and they may charge a transaction fee for exchanging foreign currency.
ATMs
Using a foreign ATM or your bank's ATMs overseas is often the best option for exchanging currency and saving on fees. If you don't want to carry large amounts of cash, check if your bank has ATMs in your destination country.
Airport Kiosks
Airport kiosks are known for charging high fees and offering poor exchange rates. However, they can be a convenient option if you need to exchange a small amount of money, and some providers allow you to order your foreign currency online for airport collection, which can get you a better exchange rate.
Other Options
Other options for exchanging currency include credit unions, online bureaus, and currency converters, which often provide inexpensive services.
Tips for Getting the Best Exchange Rate
- Compare rates with various dealers, on different portals, and on different dates.
- Plan ahead and exchange your currency before arriving at the airport.
- Use a multi-currency card, which offers conversions at the mid-market exchange rate without any markups or hidden fees.
- Be cautious of exchanging currency with local dealers near the airport, as you may suffer losses.
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Frequently asked questions
Most major airports have currency exchange kiosks or booths, such as Forex or Travelex, where you can exchange your foreign currency. You can also use an ATM at the airport to withdraw cash in the local currency.
Exchanging foreign currency at the airport is convenient, especially if you're short on time before your trip. It is also a safe option, as unauthorized dealers may operate in local markets near the airport.
Airport currency exchange kiosks and booths generally charge high fees and offer poor exchange rates. You may end up losing about 15% of your money due to high fees and unfavourable exchange rates.
