Exchange Rate vs Transfer Fee: What Really Matters When Sending Money Overseas?

When sending money overseas, many people naturally look for the lowest transfer fee. Seeing “$0 fee” can sound like the best deal — but the fee is only one part of the total cost of an international money transfer.

The exchange rate can have a significant impact on how much money your recipient ultimately receives.

Why the exchange rate matters?

The exchange rate determines how much foreign currency you receive for each New Zealand dollar you send.

Even when a transfer provider charges no separate transfer fee, the rate offered may differ from another provider. This means two providers can process the same NZD amount but deliver different amounts to the recipient.

That’s why comparing fees alone may not give you the full picture.

What is an indicative exchange rate?

An indicative rate is an estimated exchange rate provided as a guide. Foreign exchange markets move, so the rate available when your transaction is actually processed may differ.

When comparing providers, make sure you understand whether the rate being displayed is indicative or the rate that will actually apply to your transaction.

Three things to check before sending money

Before making an international money transfer, consider the exchange rate being offered, check for any applicable fees or charges, and most importantly, confirm the final amount the recipient is expected to receive.

A transfer with a fee could potentially result in a higher recipient amount than a transfer advertised with no fee, depending on the exchange rate and other applicable charges.

Look beyond “zero fees”

The simplest comparison isn't necessarily:

“Who charges the lowest fee?”

A more useful question is:

“For the amount I’m sending, how much will my recipient actually receive?”

At Relianz Forex, we aim to provide clear information so customers can understand their international money transfer before proceeding.

Planning an overseas transfer? Talk to the Relianz Forex team on 0508 411 111 and compare your options.

Exchange rates are subject to change. Indicative rates are for illustrative purposes and may differ from the final rate available at the time of transaction. Fees and other terms may apply.