How Telexoo can save you money through exchange rates

For each payment in foreign currency or via a foreign transaction, banks take what is called in the financial jargon a “spread”, which actually is a margin expressed either in percent or in Pip (percentage in point). The higher this margin is, the less competitive is the exchange rate that the bank grants you.

These margins will be more or less important depending on the amount that you send and the desired currency. 

In fact, banks exchange currencies among themselves at interbank rates, which is the market rate that you can follow on the main economic and financial websites. However, when a corporate or private customer needs to buy or sell a currency, banks will apply a margin or a commission. 

These margins can be very expensive. For instance, if you are an event planning company and you want to pay a bill for the organization of a golf course in Morocco in Moroccan dirham, traditional banks will apply a margin of 5% on the interbank exchange rate. Telexoo allows to reduce this margin by 80%.

These margins can also have severe consequences if, for example, you have a company that processes large annual volumes of very common currencies such as EUR, USD, GBP but which are cut into multiple monthly transactions. In that case  the bank will not consider your annual volume of business to calculate its margin, but it will instead apply the spread corresponding to the amount of your transaction.

It seems quite unfair when you have an annual payment volume in hundreds of thousands, or even in millions, and the bank applies its maximum margin because you pay a bill of 10'000 euros.