Exposed – the hidden cost of foreign exchange

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Foreign exchange, both international money transfer and foreign currency exchange, is more expensive than meets the eye. For years, banks have charged hidden fees. We are on a mission to make foreign exchange more transparent and we've exposed the adverts that banks and brokers use to obscure the real costs

TransferWise
The numbers speak for themselves.

The numbers speak for themselves.

MoneyGram are claiming that this fee will be the  only one you need to transfer money abroad. What they don't mention is that on top of this fee is the inflated exchange rate that they choose to use, instead of the mid-market rate. All the money in between goes straight from your pocket, into theirs.

MoneyGram are claiming that this fee will be the only one you need to transfer money abroad. What they don't mention is that on top of this fee is the inflated exchange rate that they choose to use, instead of the mid-market rate. All the money in between goes straight from your pocket, into theirs.

The reason 'free' transfers don't exist is that UKForex are changing you money by using their own, inflated, exchange rate. When UKForex talk about the 'best exchange rates' they are referring to their own exchange rate. Not the real mid-market exchange rate. That's the best one.

The reason 'free' transfers don't exist is that UKForex are changing you money by using their own, inflated, exchange rate. When UKForex talk about the 'best exchange rates' they are referring to their own exchange rate. Not the real mid-market exchange rate. That's the best one.

HiFX claim to charge 'no fees' but in reality they are gaining fees from their customers by not using the real mid-market exchange rate.

HiFX claim to charge 'no fees' but in reality they are gaining fees from their customers by not using the real mid-market exchange rate.

In this advert, HiFX allude to using their own exchange rates, but still claim transfers with them are 'free': "no fees, no charges, no commission".

In this advert, HiFX allude to using their own exchange rates, but still claim transfers with them are 'free': "no fees, no charges, no commission".

Here RBS is advertising a flat fee for international money transfers. Unfortunately for customers, sending money abroad with RBS will not end up costing £10. When breaking down their fee structure, RBS neglect to disclose that customers will lose money through their exchange rate markup. Ergo, money transfers are not 'just' £10.

Here RBS is advertising a flat fee for international money transfers. Unfortunately for customers, sending money abroad with RBS will not end up costing £10. When breaking down their fee structure, RBS neglect to disclose that customers will lose money through their exchange rate markup. Ergo, money transfers are not 'just' £10.

Western Union advertising nice and clearly in Liverpool St. station that they offer overseas money transfers for "£0 fee." They do not explain that they profit on the exchange rate markup using their "fixed rates" and that this will cost you money.

Western Union advertising nice and clearly in Liverpool St. station that they offer overseas money transfers for "£0 fee." They do not explain that they profit on the exchange rate markup using their "fixed rates" and that this will cost you money.

Banks often claim they charge no fees to send money abroad. In reality, they take money from customers by marking up exchange rates. So while HSBC are offering "preferential rates", they are still not offering the real mid-market exchange rate.

Banks often claim they charge no fees to send money abroad. In reality, they take money from customers by marking up exchange rates. So while HSBC are offering "preferential rates", they are still not offering the real mid-market exchange rate.

UKForex are offering "free transfers" with "no fees". Their definition of fee-free must be quite specific, as customers will lose money by being given a poor exchange rate.

UKForex are offering "free transfers" with "no fees". Their definition of fee-free must be quite specific, as customers will lose money by being given a poor exchange rate.

Western Union frequently claim that customers don't pay any fees for international money transfers. Yet as we can see from this advert, Western Union makes money through "FX gains". Surely this counts as a fee?

Western Union frequently claim that customers don't pay any fees for international money transfers. Yet as we can see from this advert, Western Union makes money through "FX gains". Surely this counts as a fee?

"Great rates", but not real inter-bank rates. And TNT – isn't the money you take from the exchange rate markup classed as a "hidden fee"?

"Great rates", but not real inter-bank rates. And TNT – isn't the money you take from the exchange rate markup classed as a "hidden fee"?

Flat fees don't tend to exist when it comes to sending money abroad. So while MoneyGram advertise a 'fixed fee' of £2.99, they will also apply their own exchange rate – making money on the gap between their rate and the real mid-market rate.

Flat fees don't tend to exist when it comes to sending money abroad. So while MoneyGram advertise a 'fixed fee' of £2.99, they will also apply their own exchange rate – making money on the gap between their rate and the real mid-market rate.

Here, HSBC is advertising international payments for a flat fee of £4. However, HSBC neglects to inform the customer about the money they make from exchange rate markups.

Here, HSBC is advertising international payments for a flat fee of £4. However, HSBC neglects to inform the customer about the money they make from exchange rate markups.

No commission taken and "superior" exchange rates, but HDNC do not offer the real mid-market exchange rate and will still make money through an exchange rate markup. Another example of how foreign exchange is deceptively priced and advertised.

No commission taken and "superior" exchange rates, but HDNC do not offer the real mid-market exchange rate and will still make money through an exchange rate markup. Another example of how foreign exchange is deceptively priced and advertised.

Here, Citibank makes a strange distinction between 'free' and 'fee-free'. Since banks and brokers are not obliged to be transparent and call the money they make from exchange rate markups 'fees', adverts like this can look accurate. They are misleading as they encourage the customer to think that transfers are actually fee-free – resulting in a nasty shock when they look at their bank statements.

Here, Citibank makes a strange distinction between 'free' and 'fee-free'. Since banks and brokers are not obliged to be transparent and call the money they make from exchange rate markups 'fees', adverts like this can look accurate. They are misleading as they encourage the customer to think that transfers are actually fee-free – resulting in a nasty shock when they look at their bank statements.

HSBC's page on international payments looks reasonably transparent until you break down what the phrases actually mean. 'Flat fees' do not take into account the money customers will lose through exchange rate markups, and 'live rates' do not mean real mid-market exchange rates.

HSBC's page on international payments looks reasonably transparent until you break down what the phrases actually mean. 'Flat fees' do not take into account the money customers will lose through exchange rate markups, and 'live rates' do not mean real mid-market exchange rates.