The big banks offer a simple and convenient way to send international money transfers. But banks also charge big markups on top of the mid-market exchange rate — which means the transaction can end up costing you much more than it should.
So if you use a provider that specialises in exchanging foreign currency, you can get a better bang for your buck. And that's where the best currency brokers come in.
What is a currency broker?
A currency broker makes it easy and more affordable to send money overseas. When you use a broker to send an international transfer, they buy and sell currency on your behalf and then transfer the funds overseas.
For example, if you want to send money to the UK, a currency broker can exchange your Australian dollars for British pounds at an attractive exchange rate, and then transfer the pounds to your recipient's UK bank account.
Currency brokers are sometimes referred to as foreign exchange brokers or money transfer services. Unlike banks, which offer a diverse range of financial products and services, currency brokers specialise in moving money around the world. And because they buy and sell large volumes of currency, they can access better exchange rates — in other words, they can get a better price because they buy in bulk.
This means they can generally offer better exchange rates than banks when you want to send money overseas.
Top currency exchange brokers
Searching for the best currency brokers in Australia? Here are four options worth considering.
TorFX
TorFX is a foreign exchange broker that offers international transfers in over 40 currencies. It also supports forward contracts, limit orders and stop-loss orders to help you get the exchange rate you want, and personal and business accounts are available based on your transfer needs.
Transfer fees: $0
Exchange rate markup on major currencies: Approx. 0.5-2%
Maximum transfer limit: No maximum limit
Pros
Competitive rates and no fees
Dedicated account manager to answer your questions
Suitable for large transfers
Cons
Rates are poor for small transfers
Doesn't accept credit card payments
You'll need to provide your details to get an exchange rate quote
Currency broker OFX supports international transfers in over 55 currencies. You can lock in your exchange rate for up to 12 months with a forward contract, and there's 24/7 customer support if you need help with a transaction. Personal and business accounts are available depending on your needs.
Transfer fees: No fees on transfers over $10,000, $15 fee if you transfer less than $10,000
Exchange rate markup on major currencies: 0.5-2%
Maximum transfer limit: No maximum limit
Pros
Send money to over 170 countries
No fees on large transfers
Supports forward contracts, limit orders and recurring transfers
Cons
Minimum transfer amount of $250 won't suit everyone
WorldFirst offers a range of international payment solutions for business customers. A World Account from WorldFirst lets you open up to 10 local currency accounts, while forex tools like forward contracts help you get the exchange rate you want. Other features include the ability to make up to 200 payments at once, and Xero integration to make accounting management easier.
Transfer fees: $20 on transfers up to $2,000, $10 on transfers $2,000-$9,999, no fees on transfers $10,000 and over
Exchange rate markup on major currencies: 0.15-0.50% based on annual transfer volumes
Maximum transfer limit: No maximum limit
Pros
Competitive exchange rates and no fees on large transfers
Same-day transfers to USD, EUR and GBP
Advanced tools like forward contracts and firm orders
Cons
Business transfers only
High fees on small transfers
Doesn't support as many currencies as some other options
Founded in 2018, Send Payments is a currency broker that offers personal and business foreign exchange solutions. It allows you to send payments around the world in 37 currencies, and it supports advanced foreign exchange tools like forward contracts and regular payments.
Transfer fees: $0
Exchange rate markup on major currencies: not available
Compare money transfer providers for large transactions
Our table below lets you compare services you can use to send money abroad. Compare fees, exchange rates and discounts from different money transfer services, and when you have made your choice, click Go to site.
Things to think about when choosing a currency broker
Keep the following factors in mind when comparing currency brokers:
Exchange rate markup. The lower the broker's markup, the more affordable your international payment will be. Look for a broker that offers consistently low markups on the currencies you want to exchange.
Transfer fees. Check whether the broker charges any transfer fees. The best currency brokers often won't charge fees or will waive their fees on large transfer amounts.
Transfer speed. If you want the money to arrive to your recipient as quickly as possible, check the broker's transfer processing times.
Transfer limits. Check whether the broker's minimum and maximum transfer amounts suit your needs.
Advanced tools. Does the broker support forward contracts, so you can lock in today's exchange rate for a future transfer? Can you place a limit order to automatically send your transfer when the exchange rate you want becomes available?
Business tools. If you're transferring money overseas for business, check whether the broker allows you to set up recurring payments or mass payments.
Customer service. Is 24-hour customer support available if you need help with a transfer? Check how you can contact the support team — phone, live chat, email or all of the above.
Are they regulated? Check to see if the currency broker is regulated by the Australian Transaction Reports and Analysis Centre (AUSTRAC). If they offer foreign exchange contracts that don't settle immediately, such as forward contracts, check to see whether they have an Australian Financial Services Licence.
Customer reviews. Finally, read independent customer reviews to find out what other users have to say about the broker's transfer costs, speeds and customer service. Would they recommend the provider to other people who need to send money overseas?
Are currency brokers cheaper than banks?
Yes, currency brokers tend to offer cheaper international transfers than banks.
The main cost you need to consider when sending money overseas is the exchange rate markup (or margin). This is the difference between the exchange rate at which a transfer provider buys currency and the exchange rate it offers when it sells the currency on to you.
Banks commonly charge exchange rate markups of 3-5%, while currency brokers have lower markups so you can get an exchange rate closer to the mid-market rate.
The second cost you need to consider is the transfer fee. Banks usually charge a flat fee for international transfers. Some currency brokers don't charge any fees, while others will waive their fees on large transactions.
To demonstrate the cost difference, let's look at the example of sending $20,000 to the USA with a bank vs a currency broker. The mid-market exchange rate is 1 AUD = 0.65 USD, and the exchange rate markup varies between providers as follows:
If the bank's markup is 4.5%, you'll get a rate of 1 AUD = 0.62 USD
If the currency broker's markup is 1.5%, you'll get a rate of 1 AUD = 0.64 USD.
The currency broker doesn't charge any fees on transfers of $10,000 or more, but the bank charges a flat fee of $20 on all transfers. As you can see in the table below, this means it'll cost you $20 more to send the transfer via your bank, but your recipient will get US$400 less.
Bank
Currency broker
Transfer amount
$20,000
$20,000
Exchange rate
1 AUD = 0.62 USD
1 AUD = 0.64 USD
Transfer fee
$20
$0
Total cost of transfer
$20,020
$20,000
Amount received
US$12,400
US$12,800
Bottom line
If you're sending a large international money transfer or you need to make lots of international payments, using a currency broker instead of your bank could save you money. Compare a range of currency brokers to find the best rates, lowest fees and reliable customer service.
FAQs
Yes, if you need to send money overseas, particularly a large transfer, there are lots of good reasons why you should consider using a currency broker. Brokers offer better exchange rates and lower fees than banks, plus advanced tools like forward contracts and limit orders to help you get the exchange rate you want. They can also offer expert advice to help you time your transfer just right.
However, there are circumstances where you might be better off using an international remittance service, such as if you want to send a fast cash transfer overseas.
Yes — provided you work with a reputable and properly regulated provider. For currency brokers registered in Australia, check whether they have an Australian Financial Services Licence from ASIC and whether they're regulated by the Australian Transaction Reports and Analysis Centre (AUSTRAC). You can also read independent customer reviews to find out whether a broker offers competitive rates and fees as well as helpful customer service.
There are two ways a currency broker can make money. The first is to charge a transaction fee every time you send an international money transfer — this could be a flat fee or calculated as a percentage of your transfer amount.
The second way currency brokers make money is through exchange rate markups. Because they trade large amounts of currency, brokers get attractive exchange rates from banks when they buy currency. They then sell the currency to you at a slightly higher price, resulting in a profit.
A currency broker specialises in international money transfers and can help you get the best exchange rate when you send money overseas. Meanwhile, a forex broker offers a trading platform that you can use to trade currency pairs, speculating on the price movements of one currency relative to another to try and make a profit.
Tim Falk is a writer for Finder, writing across a diverse range of topics. Over the course of his 15-year writing career, Tim has reported on everything from travel and personal finance to pets and TV soap operas. When he’s not staring at his computer, you can usually find him exploring the great outdoors.
What are the best options for sending or receiving a large amount of money overseas? Read this $50,000 case study with exchange rates and fees comparison.
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