Where to exchange currency when studying abroad

University isn’t cheap – especially as an international student.  

For students moving abroad with foreign currency or those working in cash-based jobs with imminent plans to return home, knowing the ins and outs of exchanging currency may be an important part of their study abroad experience. Without knowing the pitfalls, students can easily be overcharged and left with less to spend while away.  

Here’s a useful guide to help you exchange currency without paying extortionate fees. 

Where to exchange currency

There are many places to exchange currency around the world, such as banks, currency exchange kiosks, airports, hotels and ATMs. 

But remember, not all currency exchange methods charge the same rate and some businesses, particularly in tourist-heavy areas, take advantage of travellers to make a profit.

Make sure to check the rates, fees and charges before exchanging money. And, as a rule, it’s probably better to do this before you travel. 

Banks 

Offering reasonable exchange rates and the lowest fees, banks and credit unions are usually the best places to exchange currency. To get the best rates at these institutions, exchange currency before your travels begin. Many banks offer currency exchange – although there may be a small fee to exchange less than a certain amount, as stipulated by the bank. 

Some banks offer the service to order currency at a branch location, or by phone or online. The funds can be delivered, or collected at a branch. Some currency providers also allow next-day pickup and/or overnight shipping. 

International banking apps 

While travelling, it’s well worth considering downloading an international banking app to manage your money. Many of these apps offer good rates, make it easier to hold multiple currencies, and transfer money to accounts in different countries. 

With a multiple currency account, you can keep money in various currencies, which is useful if you frequently travel to different destinations. This helps you avoid the volatility of currency exchange rates, since you’ll always have money ready for your next trip. 

If you use a money transfer app to regularly send money abroad to loved ones, remember to opt for a provider that is clear and upfront about the fees you will pay. For example, WorldRemit has an app with a currency converter , which can help you look up rates. 

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Currency exchange kiosks 

If you haven’t planned ahead, it can often be tempting to pop into a currency exchange kiosk in a shopping mall abroad, or in a tourist area. While these merchants may offer convenience, their exchange rates are far less favourable than your bank at home. They may also charge higher fees, which are sometimes hidden within the poorer exchange rates they offer. 

Hotels and airports 

Unfortunately, while hotels and airports may be the most convenient place to change currency, they aren’t the cheapest, so perhaps try to avoid exchanging money there. 

If you have to, then make sure you find a kiosk with the best rates and check if there are any minimum or maximum amounts you must change to make the best of the rates. 

ATMs 

Once you’ve reached your destination abroad, your bank’s ATM network is likely to be your best option for changing money. You may be able to withdraw cash in the local currency, with competitive exchange rates and low fees (1 to 3 per cent). Look online or use your bank’s app to find the nearest ATM. 

It’s worth withdrawing larger amounts if your bank charges ATM fees. And try not to use ATMs that are not connected to a bank because they may charge foreign transaction fees. Plus, you could end up paying surcharges to your bank and the ATM owner. 

Further tips on exchanging currency while abroad

• Avoid airport kiosks and foreign exchange desks – although exchanging currency at the airport may be convenient, try to avoid doing so given the outrageously high exchange fees. Airport kiosks can charge up to 20 per cent in fees and have a much lower exchange rate compared with banks and private exchange companies.
• Check your credit cards work internationally – look into potential fees that may apply while abroad. These could include: currency exchange fees, transaction fees or service charges on cash advances. However, certain international credit cards have no foreign transaction fees.
• Be aware that debit cards may charge foreign transaction fees and international ATM fees – be sure to only use debit cards for cash withdrawals and not as a method of payment in shops or restaurants.
• Foreign currency cards – these prepaid foreign currency cards work like credit or debit cards. They’re preloaded with a set amount of currency, which is deducted as you use it.  Restrictions may apply, such as withdrawal and inactivity fees and withdrawal limits.
• Use local banks – exchanging money at local banks is not only convenient but much less expensive than exchanging at airports or hotels. They also tend to give decent exchange rates.
• Travellers cheques are not accepted everywhere – unlike cash, travellers cheques come with the added security of being replaced if lost or stolen. However, due to the declining use of travellers cheques, they may not be accepted by some businesses.
• Say ‘yes’ to local currency – avoid hidden transaction and conversion fees by ensuring that all purchases are charged in the local currency.