Finance Tip of the Week: Foreign Exchange
by Gareth Cotten on 06/05/10 at 8:50 am
2 comments
The worst places (and times) to exchange your foreign currency. Having recently had to change some dollars back into Rands, I was reminded of a couple of hints to keep in mind when changing money from one currency into another.
Firstly, try and get to the bureau de change section of a major bank (especially your own bank if they offer it) – they have less need to charge exorbitant rates and commissions on the changeover, by virtue of their size.
Secondly, if you must use a private currency conversion agency (as in not a bank), make sure to shop around with at least a few in the area – with each offering different variances of commissions and flat fees, the amount you get out in the end can vary significantly.
Thirdly, it’s often the case that you can get a better price than what they first offer you – request to deal with a supervisor or floor manager, and make sure they know you’re shopping around (I was able to halve the original commission charged on my exchange).
Fourthly, if you can help it, don’t exchange currency at your hotel – they charge a heavy premium for the convenience of exchanging your money there and then. The same applies to exchanging at airports and major tourist attractions – they know that they have the market cornered in that space, and load their margins significantly.
And fifthly, if you are going to use a private agency (think Thomas Cook or American Express as the big ones here in SA), make sure to get to them before the closing time of local banks. As was explained to me by a rather earnest supervisor, their commission rates go up after the major banks close, as they know they have the ‘monopoly’ on the market for the following few hours…
Gareth Cotten is one of the growing breed of SA entrepreneurs with that ‘world-domination’ look in his eyes. Gareth runs the coaching and consulting practice 'Good Advice'. Gareth is also the 'course convener' for the University of Cape Town (Law@Work) Start and Manage a Small Business course and the University of Cape Town Basics of Financial Management course. View more articles by Gareth Cotten.
Tags: finance
Phill Reynolds
Jun 14th, 2010
Thanks for the advice Gareth – Ps: if you have a cell phone, landline and internet access you might want to check out this article…
http://groups.google.com/group/wirelessdataservices
Bernarda Scriver
Apr 3rd, 2011
Heya are using Wordpress for your blog platform? I’m new to the blog world but I’m trying to get started and set up my own. Do you need any coding knowledge to make your own blog? Any help would be really appreciated!