Places to Avoid Exchanging Currency
The worst places to exchange your money for another currency are:
- Airport kiosks.
- Hotels.
- Tourist centers.
At such places, the conversion rates are usually not in your favor. Be aware of current exchange rates, especially if you cannot locate a local ATM, says Arica Tomlinson, a category sourcing leader at GE Healthcare in Milwaukee.
“During a trip to Prague, I attempted to exchange some of my U.S. dollars for the local currency,” she says. “For my $100, the currency exchange representative offered me the equivalent to $50 worth of koruna. After my protestations, they offered me an improved rate, but I took my money to a local bank for exchange instead.”
If you have to exchange money in another country, plan on paying extra service fees and more for the exchange spread, the rate the business will give you when you are selling your U.S. dollars to them, says Derek Horstmeyer, a finance professor at George Mason University. The exchange spread could be 1% to 2%, he says.
Always be careful using mobile apps to transfer money in foreign countries, particularly apps that rely on texts, since there is the added risk of a potentially untrusted mobile infrastructure, says Sounil Yu, chief information security officer and head of research at JupiterOne, a Morrisville, North Carolina-based provider for cyber asset management and governance. “This is especially true if you are in the Eastern bloc or certain countries in Asia. Also, make sure that you don’t download country-specific mobile applications for financial services, as that comes with additional unknown risks. In my opinion, airports are the worst place to exchange money, and banks are the best.”
Alternatives to Exchanging Currency
- Credit cards.
- Prepaid cards.
- U.S. dollars.
- Mobile payment providers such as Google Pay, Android Pay or Apple Pay.
Using your credit cards for purchases, prepaid cards or even U.S. dollars can be good alternatives to exchanging currency. Even smaller businesses that are at a street food night market or festival will take electronic payments, and other countries such as Mexico or French Polynesia will accept the U.S. dollar.
Your credit card company may also offer good exchange rates – check with it beforehand to see what the rates are. Paying for hotels, restaurants and rental cars with credit cards is often your best bet since they also offer protection on your purchases and additional reward points for transactions at various businesses.
It can be a good strategy to inform your credit card company about your trip when you ask about additional security features, Schrader says.
“Credit card or debit card details are stolen in milliseconds, using compromised ATMs or contactless readers, so a precaution can also be to reduce the limits on your cards for the period of travel, or even apply for an additional card just for the travel,” he says.
Many credit or debit cards provide a 0% foreign transaction fee and are a good option to pay for dinner or museum or sporting event tickets.
Using mobile payment providers also can help prevent fraud while you are traveling.
Analysis
As I continue my research, both in reading as well as interviewing people, I’m beginning to notice a lot of disparities between how people handle foreign currency. Some people swear by exchanging solely in-country, while others refuse to do so because of the fees. This article recommends exchanging everything before and re-exchanging all leftovers after. I’m beginning to see that the road to banking internationally is full of lots of different options and pathways, and every source is trying to convince a future traveler that they’re the best option. Thus, travelers are left to decide for themselves what their most economical option is, instead of being offered the best one upfront.
Source
Chang, E. (2022, December 9). Where is the best place to exchange foreign currency?. US News. https://www.usnews.com/banking/articles/where-is-the-best-place-to-exchange-foreign-currency
