Skip to main content

Is your bank ripping your business off with costly foreign exchange mark-ups?

 How to avoid foreign exchange pitfalls for small and medium sized business  | Business West

Since the largest banks in the UK, such as Barclays, Lloyds and HSBC, charge lower exchange rates, British companies that make regular payments abroad lose hundreds of pounds per transaction. HSBC calls itself the local bank of the world.

Learn More at Foreign exchange international money transfer

Levying currency exchange surcharges, these surcharges are actually hidden fees paid overseas, which may be as high as hundreds of pounds. Except for Lloyd, there are none of the five largest business account providers in the UK, and their combined ratio is close to 90%. Cents of the market share of small and medium-sized enterprise banks, publicly disclosing these fees on their website before payment, some seem to hide these fees completely. -ups, especially now except for Norway, Iceland, Liechtenstein and Switzerland, 27 EU member states no longer allow customers to collect certain payments from customers abroad. 

Payments to other countries, especially US dollar transactions, will still face a dizzying series of fees, but because of the unclear profit margins, they also face the problem of low exchange rates. Lloyds Bank describes their percentage fees, ranging from 2.6%. cents to 0.75%, depending on the amount transferred, such as The difference between the exchange rate of Lloyds Bank and the exchange rate at which we buy and sell currencies on the wholesale money market.

While this means that a company will save 520 pounds by sending 20,000 pounds abroad, it allows at least bank customers with 19% of the SME market to compare their interest rates before making transactions. However, other peoples rates are not so transparent. 

NatWest stated on its website that “when a transaction requires foreign currency exchange, a margin will be applied”, but did not specify how much the margin may be.

Comments

Popular posts from this blog

The Advantages of Foreign Exchange for Tech Companies

When it comes to foreign exchange, there are a lot of advantages that tech companies can take advantage of. First and foremost, foreign exchange can help tech companies access new markets and customers. In addition, foreign exchange can also help tech companies hedge against currency risk, and it can provide opportunities for arbitrage. Let's take a closer look at each of these advantages in turn. Increased Globalization of Technology Companies The globalization of technology companies has led to an increase in the need for foreign exchange services. As these companies expand their operations into new markets, they require foreign currency to pay for goods and services. In addition, many technology companies now have a global supply chain, which means they are buying and selling goods and services in multiple currencies.  Access to new markets and customers.  When you expand your business into new markets, you're also opening up your customer base to a whole new group of peopl...

4 Foreign Exchange Risks to Consider When Running a Business

When running a business, there are a lot of things to think about in order to ensure its success. One important thing to keep in mind is the foreign exchange risk that your business might face. This type of risk can come from a number of different sources, so it's important to be aware of them and take steps to mitigate their impact. Here are four of the most common foreign exchange risks to consider when running a business.   1. Economic Instability Risk   One of the biggest foreign exchange risks that businesses face is economic instability. This can come from a number of different sources, such as political unrest or natural disasters. When there is instability in a country, it can lead to a decrease in the value of its currency. This, in turn, can make it more expensive for businesses to import goods from that country or sell goods to customers in that country. To mitigate this risk, businesses should diversify their supplier and customer base so that they are not too reli...

How Political Instability Impacts Foreign Exchange Rates: Analyzing Recent Examples

Political instability can have a huge impact on foreign exchange rates. The foreign exchange market, or Forex, is the largest and most liquid financial market in the world with an estimated daily trading volume of over 5 trillion dollars. It is an ever-changing market that is driven by news and events, both global and domestic. When it comes to political instability, news reports can cause rapid changes in exchange rates that can have a significant effect on businesses. Let’s take a look at some recent examples to understand how political instability impacts foreign exchange rates.   US-China Trade War   One of the biggest influences on foreign exchange rates in recent years has been the ongoing trade war between China and the United States. In 2018, President Trump imposed tariffs on Chinese imports which caused a dramatic drop in the value of China’s currency, the Renminbi (RMB). This led to China devaluing its currency to mitigate some of the effects of the tariffs. As a re...