There are numerous traps along the route, and the money changers' fees are devastating.

The UK had recently decided to return Hong Kong to China, the country was engulfed in the miners' strike, and King Charles was only 36 years old the last time the pound was this weak relative to the dollar. Since the financial crisis of 2008, things haven't been this terrible against the euro.

This will be good news if you have been working abroad and are returning to the UK with savings in foreign currencies, or if you are thinking about purchasing a UK home from abroad, but it will be bad news if you are a British citizen and are pursuing your lockdown dream of purchasing a foreign vacation home.

In either case, you have probably not given much thought to how much the money changers will charge you to transfer the money.

“Most people do large currency transactions only a few times in their lifetimes, if at all, so they are unfamiliar with the how the currency market works and the companies that operate in them,” says Colin Dewar, who ran Hargreaves Lansdown’s in-house currency desk before the service was handed to Currencies Direct in 2020. “Rules for banking and transferring large amounts of cash vary between countries and are subject to change.”

Various businesses employ various billing methodologies. Online money changers wise.com and Revolut charge a transaction fee and exchange currency at or near to the interbank rate, which is the lowest rate at which major banks can deal with one another. However, the majority of specialized brokers make money by adding a markup to the interbank rate known as a spread. Hunting for the best deal is important, because exchange rates for large money transfers vary wildly.

Source: https://www.ft.com/content/da908b6a-9d7e-4d7f-84a2-4573082fd95d