How to use the Currency Converter
- Enter the amount and the quoted exchange rate.
- Add the provider's margin or spread as a percentage.
- Add any fixed transfer fee.
- Compare the effective rate — amount received divided by amount sent — across providers.
How the calculation works
The mid-market rate sits halfway between the buy and sell prices in the interbank market. Retail providers quote a rate a little worse than mid-market and pocket the difference; that margin is the real cost and is often invisible because the transfer is advertised as 'zero fee'. A 2.5% spread on 5,000 costs 125 whether or not a fee line appears.
Compare providers on amount received, never on advertised rate. Fixed fees dominate on small transfers while percentage spreads dominate on large ones, so the cheapest option changes with size. Card transactions abroad add their own layer: dynamic currency conversion, where a terminal offers to charge you in your home currency, typically applies a 3–7% markup and should always be declined.
Received = (amount − fixed fee) × rate × (1 − spread) ; effective rate = received / amountSource: Mid-market rate and spread terminology per standard foreign-exchange market conventions.
Worked example
Sending 4,000 at a mid-market rate of 1.2650 with a 1.8% spread and a 6 fixed fee.
- Amount after fee = 3,994.
- Applied rate = 1.2650 × (1 − 0.018) = 1.2422.
- Received = 3,994 × 1.2422 = 4,961.4.
- Mid-market would have given 5,060.
Effective rate 1.2404 — the transfer cost about 98.6, of which only 6 was labelled a fee.
Frequently asked questions
Why does my bank's rate differ from Google's?+
Google shows the mid-market rate. Banks add a margin to it, which is how they earn on the transaction.
Should I accept conversion in my home currency abroad?+
No. Dynamic currency conversion nearly always applies a worse rate than letting your card issuer convert.
Is a zero-fee transfer actually free?+
Rarely. The cost usually moves into the exchange rate spread instead of a visible fee line.
Do rates change during a transfer?+
Yes, unless the provider locks the rate. Most lock for a short window once the transfer is funded.
Last reviewed August 31, 2026. We review this page whenever the underlying formula, tax year, published rate or standard changes.