Banks charge non beneficiary clients a ‘hidden’ cost within the currency rate it offers to use proposing to convert your monies.
To reveal this cost, what you should do is, ask your bank for the two FX rates quotes for converting an amount, for both conversion direction (i.e. USD to GBP, as well as GBP to USD). These are both Bid and Ask rates for the pair. For example, you may be offered the rate of 1.2408 USD to 1 GBP wanting to buy GBP, and the lower rate of 1.2137 USD to 1 GBP wanting to sell GBP.
Now, calculate the average of the two rates: the high exchange rate at which you can buy expensively, which in the example is 1.2408, and the low exchange rate at which you can sell cheaply, which is 1.2137, and you will get the average: 1.2272. The percentage that constitutes the difference between the rate offered to you and the average, out of the average, is a cost that is hidden within the exchange rate. In this example, the difference between the rate offered to you and the average is 0.0135 USD, and the percentage that it constitutes out of the average rate 1.2272, is 1.1%. That is, the hidden cost that you are charged through the currency rate, which is half of the Bid-Ask currency spread, is in the above example: 1.1% of all your to-be converted money.
On the other hand, Currenge offers you, combined with its transfer service, FX rates prevailing in currency trade room, or even better rates, plus its conversion fee of 0.1% with a $20 minimum (please see an elaboration on the Currenge pricing page), and any money transfer fees relevant for Currenge handling your transaction.
Such Currenge FX enabled rates are usually based on narrow spreads as low as 0.12-0.14%, and possibly even less. That means, the hidden cost, in rates prevailing in an FX trade room, and enabled by Currenge, which is half such price spread, is about 0.06-0.07%, of transaction amount.
When it would be possible for Currenge to convert client’s monies, using other monies received at Currenge from another of its clients, who has requested a conversion in the opposite direction, Currenge may convert for you even at zero margin, meaning at no cost hidden within the currency exchange rate.
The cost for transferring FX related to a Currenge transaction, may include your transfer of FX to Currenge, Currenge FX transfer to a trading room, and/or Currenge transfer of FX to a beneficiary. In the Israeli banks HaPoalim, Leumi and First International, the FX transfer fee, for a transfer between different accounts within the same bank, is very low. Currenge holds bank accounts, with Banks HaPoalim, Leumi, First International, Discount, and Mizrahi-Tefahot.
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