I recently came back from Auckland and China .

Prior to withdrawing cash from ATMs , the currency exchange sell and buy prices give an estimate price. I wonder how much € exactly will 100 NZD cost. But only after the transaction is done, you know accurately how much you were charged.

On top of this, some banks or merchants apply a nominal fee for each transaction.

I have so many questions :

  1. What foreign currency exchange rate is applied ?
  2. Is there a universal exchange rate or do the banks use their "own" ?
  3. Does the price fluctuate during the same day ?

Maybe only someone in retail banking can answer these questions.

  • 1
    Most banks will use the prior day close rate or some such, but it's by no means universal.
    – quid
    Commented Apr 5, 2016 at 16:51
  • Note that some ATM's now offer to "fix" the rate - the ATM owner will send a transaction back to your bank in your card's native currency. Decline this. ATM owners will invariably offer a worse rate than your own bank. ATM owners don't care about long-term customer relationships.
    – MSalters
    Commented Jun 9, 2022 at 11:24

2 Answers 2


What foreign currency exchange rate is applied ?

The rate applied is "Standard Rate". Different geographies / Banks call it by different names, Card Rate / Sheet Rate / TT Rates / etc. Essentially depending on the currency pair and market the Treasury function at Bank determines a standard rate that is to be used for the day. These have sufficient margins to cater to normal fluctuations during the day. Some Banks specifically create a ATM Rate that has higher margin to offset the loss due to fraudulent withdrawal.

There are other preferential rates and negotiated rates available for large corporates for larger transaction values.

Is there a universal exchange rate or do the banks use their "own" ?

Every Bank uses its own rate. However it has to be competitive and generally do not create an opportunity for gain. i.e. if You convert Euro to NZD at one bank and then take the NZD and convert back to Euro, you loose money. At certain times there is a window when you do large hops between EURO/USD/GBP/YEN/AUD/ etc. However this opportunity is not present for Standard rates.

Does the price fluctuate during the same day ?

See point 1. Generally "Standard Rates" do not fluctuate on stable pair of currencies. So for Euro/NZD the Standard Rates should be same. However if you take say Indonesia Rupaiya / USD or some other weaker currency, the Standard Rates may be revised by Treasury couple of time a day. If the pair is very unstable, generally Banks suspend trading. In case where it is not able to say someone withdrawing cash at ATM; the rates for such currencies are very very bad and would have huge margins.

  • 1
    Note that atm fees may need to be figured into this to get a real rate. If an ATM let's me draw up to $300, but adds a $3 fee to the transaction, that's a 1% surcharge... more if I withdraw less for the same fee. Still, I've found ATMs a much better choice than many "official" Exchange services, and hugely more convenient.
    – keshlam
    Commented Apr 6, 2016 at 5:59

The exchange rate used should be defined in the T&Cs of your credit/debit card. If it's a Visa or Mastercard the banks will generally use Visa or Mastercard's official rate.

That rate is fixed once every day. You can check the rate on their websites, for example Visa seem to use a rate which is the highest (less favourable) market price of the previous day. For example on the 22nd of March, the EUR/GBP rate fluctuated between 0.7812 and 0.7905 and the Visa rate on the 23rd is 0.7905.

MasterCard seem to give more favourable rates at first glance.

Your bank may then apply a commission on top - most high street banks charge 2.5%. That should also be stated in your T&Cs. Depending on the bank, you may see two lines on your card statement (official rate and commission) or you may just see an all-in rate (which hides the fact that you are being extorted!).

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