Are you someone who regularly deals with sending money internationally? If yes, you may have to do so for various reasons like funding the education of your children or sending money back home to your family. To get the best value for your money, there are certain things you need to know. This article looks at what exactly are those to help you make informed decisions about your money.
- Foreign exchange rates
Foreign exchange rate is the value of one currency compared to the other. The exchange rates show how much you need to purchase the other currency.
- Real-time foreign exchange rates
These rates are the ones that money remittance service providers receive from their rate providers. Real-time rates do not include any mark ups. A mark up is nothing but the additional amount that service providers add for their profit margin. It will be part of the calculations for exchange rates when you transfer money online.
- Advantages of using real-time foreign exchange rates
Real-time rates do not include any mark ups levied by international money transfer service providers. So, you are bound to get lower rates that are as close to actual rates as possible. It is essential to know that a bad exchange rate will lead you to pay more. When you deal with a large amount of money transfer, the losses will be significantly high. It is thus beneficial to deal with money transfer service providers that deal with real-time Forex rates.
- Calculation of Forex rates
Forex rates simply depend on the supply and demand behavior of currencies. For example, banks often buy and sell currencies as part of their services to meet customer requirements. When the demand for a particular currency increase, its price will go up compared to other currencies. Similarly, there will be a depreciation in value if the demand goes down.
- Uses of Forex rates
There are several uses of Forex rates besides trading the financial markets. For example, Forex rates are used for determining the cost of transferring money overseas. It is a reference point for all the parties involved in the transaction.
- Money transfer service providers and real-time forex rates
Money remittance service providers add a mark-up to exchange rates to cover their profits. For example, if 1 USD costs INR 87 in real-time forex rates, service providers may increase the price by 2-3% to cover their profits. You might thus need to pay around 87.2 to 87.3 to get 1 USD.
- Mark-ups and their legality
It is absolutely legal for service providers to add mark ups to Forex rates. They also need to earn to continue providing services to their customers. When choosing an international money transfer service provider, it is vital to research well to get the best rates. You would want to transact with a service provider offering minimal mark up charges to get the best value when you transfer money online.
Bottom line
Knowing these aspects about foreign exchange rates will help you transact without spending too much. If you are looking for a reliable money transfer Company, Lotus Remit can help. We offer the best exchange rates in the market, charge minimal processing fees, and offer personalized services. Contact us today to know more details about our money transfer services.