How do bank accounts receive payments in a foreign currency? Is the 'fee' charged by the account from which the money is being sent, or at the account where the deposit is being received? Which account dictates the conversion rate being set?

Any other advice or tips if the receiving account wants to reduce the amount of money lost due to fees and during exchange?


  • Are you a contract worker being paid by a foreign company which transfers money in their currency from their bank to your bank in your home currency, with exchange happening inbetween?
    – RonJohn
    Jan 6, 2020 at 21:37
  • 1
    I'm not a contract worker being paid by a foreign company, but the rest of what you asked is correct. My question is posing a transfer from a foreign account in their currency to another account with a different currency. Thanks, hope that's clear.
    – par
    Jan 6, 2020 at 21:39
  • So, not a payment, but "just" a transfer?
    – RonJohn
    Jan 6, 2020 at 21:50

1 Answer 1


Each participating bank (at least sender and receiver, maybe more) takes a fee. The sender of the money tells his bank how he wants the fees treated:

  • 'sender pays it all' - this results in the sending bank taking a flat rate chunk of money, and paying all fees through the chain
  • 'receiver pays it all' - this results in the receiver bank taking a flat rate chunk of the money, and paying all fees though the chain
  • 'split' - this means that each bank takes their fee out of it.

Typically, the last choice is the cheapest, as each bank takes their fee out of the transferred amount; the other two cases, they have to cover an unknown, so they take a chunk that is for sure large enough for the worst case (and keep the rest). But check their fee schedules, it's not guaranteed that way.

The currency exchange rate is typically the current international bank exchange rate (optimal for you!) plus a fee that the exchanging bank defines (this is where it hurts). Many banks don't openly state their fee, and it can be anything between 0.00% and several percent. I recommend you ask each bank in the chain about their fee schedule, and pick the one with the lowest (hopefully 0%) to do the currency exchange. The sender can then chose to:

  • 'send in source currency' - the receiver bank does the exchange
  • 'send in target currency' - the sender bank does the exchange.

You can save money by combining multiple payments into one, or by using alternative ways (outside of banks). There are many international providers, and - unfortunately - many scammers to chose from. You could also buy bitcoin or such, and sell to the other currency, but that has also transaction cost and risks.

You must log in to answer this question.

Not the answer you're looking for? Browse other questions tagged .