This challenge exists because traditionally, sending money abroad as remittances wasn’t covered by consumer protection laws. The Difficulties of Finding a “Good” Exchange Rateīecause of exchange rates and various bank or transfer fees, the reality is that your recipient never receives the full amount of money you send. See how a lower exchange rate can result in nearly 3,000 fewer pesos? For larger transfers in particular, even a small difference in exchange rate could mean losing or gaining hundreds of dollars. dollars are converted to Philippine pesos using two exchange rates: To illustrate, take a look at the following example, in which $1,000 U.S. A low exchange rate could mean your recipients receive less money. No matter how big or small, the amount of money you plan to send internationally is also heavily impacted by a currency’s exchange rate. Unlike sending money to someone within the same country, sending money abroad comes with the added complication of currency conversion.Īfter all, if you send someone money as a foreign currency, they probably won’t have much use for it unless their country also accepts that currency. When it comes to sending money internationally, exchange rates play an especially big role.

In the U.S., a stronger dollar means imported products are cheaper, whether at the mall, grocery store, or gas station. Though often thought of in the context of overseas travel, exchange rates are important to everyday life because they affect the value of a nation’s currency. Why Does a Currency’s Exchange Rate Matter? We’ll dive into the specifics of how to get the best exchange rate when sending money abroad-but first, it’s worth understanding how exactly exchange rates affect international money transfers.

The Change by Remittance Girl