Exchanging currencies at Foreign Exchange market instead of bank

External question — Personal Finance Stack Exchange Author: ronald christenkkson Original post: https://money.stackexchange.com/questions/158739 License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/ Adaptation: HTML converted to plain text; contact email addresses removed. Normally if we want to exchange US Dollars into a foreign currency (Euros for instance), we would just do it through our bank. For example right now the exchange rate (from google) is 1 USD = 0.95EUR. However, the bank will take a commission, so the rate you actually receive would be something like 1 USD = 0.92EUR. So my question is how do I bypass the bank (if possible) and access the true rate of 1 USD = 0.95EUR for myself? Is this rate in the forex markets? How would I make the currency exchange there? As you can see I'm not very familiar with this thing. Thanks for the help.

External answer — Personal Finance Stack Exchange Author: littleadv Original post: https://money.stackexchange.com/a/158740 License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/ Adaptation: HTML converted to plain text; contact email addresses removed. The market doesn't exchange cash for retail usage. The market moves millions and billions a day. So in order to deal with the small amounts of exchange of individual retail customers you need someone to aggregate the amounts into something significant enough for the market. That creates overhead, overhead costs money and demands profits, so you pay a premium to compensate. You can shop around different providers and different methods. For example, withdrawing money from a local ATM in Europe may get you a better rate than exchanging cash in your bank branch in the US. Using your US credit card directly at the European merchant may end up getting you an even better rate. Even between different cards you may get different results. Or not. Shop around and compare.

External answer — Personal Finance Stack Exchange Author: BlackThorn Original post: https://money.stackexchange.com/a/158746 License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/ Adaptation: HTML converted to plain text; contact email addresses removed. Norbert's Gambit is a potential avenue to avoid exchange fees. DISCLAIMER - I have never personally done this so I am not intimately familiar with the pitfalls. It goes something like this: You open a brokerage account that allows cheap or free trades, and exists in both your home market, and the destination market. Using the money you want to exchange, you buy assets that are traded in each of those markets. Journal your assets over into the destination market/currency. Sell assets in the desired currency. Withdraw your money. You may need a bank account open in the destination market, might not. It probably depends on how the brokerage allows fund distribution. Obviously this is a moderately complicated process and is usually employed to save money for exchanging large sums. It is subject to both the price volatility of the asset that you are using for the exchange, as well as the price volatility of the currencies themselves as it will usually take a few days to complete. If you decide to do something like this, I recommend researching more. Many financial websites have guides.

External answer — Personal Finance Stack Exchange Author: Petr Original post: https://money.stackexchange.com/a/158757 License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/ Adaptation: HTML converted to plain text; contact email addresses removed. There is no country tag, so I'll post an answer, although it is obviously outdated. For many years, in Russia, this was possible, and I had been doing this several times. It was done very similar to buying any investments (stocks etc.) through brokerage account open at my bank (or actually at a broker company owned by my bank). I would transfer rubles from my regular ruble bank account to this brokerage account, then buy dollars on Moscow exchange with exact exchange market rate, then transfer dollars to my dollar bank account in the same bank, then I could do anything with it: withdraw dollar cash from ATMs of that bank, pay with a dollar bank card, transfer dollars via SWIFT, etc. Of course, there was some fee for transactions on the exchange, but it was rather low, something like 0.5%, much lower than the typical bank exchange rate spread. All the transfers were free, as they were within the same bank. Probably there was some minimal sum, or the sum had to be a multiple of some fixed amount, but these were definitely not prohibitively high, maybe $1000. Obviously it is not possible to do this anymore, although I have not checked it recently, probably it is still possible to buy yuans...

External answer — Personal Finance Stack Exchange Author: fixerlt Original post: https://money.stackexchange.com/a/158761 License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/ Adaptation: HTML converted to plain text; contact email addresses removed. There actually is a relatively easy way to pull of such a scheme. I know quiet a few people, who do it through Binance. They have other reasons, but you should check Binance's p2p platform and compare rates yourself. As you're talking about USD, you can easily buy USDT and check for best rates on p2p. Best available deal right now offers 0.985 EUR for each USDT if you withdraw to Perfect Money. For Sepa its 0.953 and i even see an offer for 1 EUR for 1 USDT (Revolut), if you buy 24k+. I just google European Central Bank's USD to EUR which i about 1/0.947, which is already worse even without bank commision. I have personally used Binance's p2p service about 60 times(account data) with 0 issue. Although it is possible to encounter a fraudulent operator, who won't send you money, but claim they did: it will result in wasting a couple of hours at most, unless you click "i recieved payment", before you see the money arrive on you bank account. So, yes, it's both possible and easily doable to bypass the bank.