Calling for more action: The state of transparency in Australia
Why are we still paying so much for international payments? Sending money abroad is a big deal for many Australians. You might be supporting your family,...
The Fee-free Fallacy
A $6 Billion hole in our pocket
Imagine walking into a grocery store where a litre of milk is listed for $2. You pay your $2, but when you get home, you realise the carton is only three-quarters full. When you call the store to complain, they point to the fine print: 'We sell our litres at a custom volume.' They didn't charge you a 'service fee' at the register—they just quietly redefined what a litre is to make sure they kept 25% of the milk.
This is exactly how many banks handle your international money.
Here's what you might not know. By advertising '$0 fees' while baking markups of up to 3.92% into the exchange rate itself, they haven't actually made the service free; they've just moved the price tag to a place where they hope you won't look.
What goes into a hidden fee? A bank rarely gives you the exchange rate you'd usually see on Google or Bloomberg. Instead, they add a 'markup'.
Think of it like this. You're sending $1,000 AUD to the United States. The bank might state a $0 transaction fee. That looks transparent and free. What they don't highlight is the 3.5% markup they've added to the rate itself. That's $23.50 taken from you, quietly hidden in the conversion.
Stated Fees vs Real Total Cost (per $1,000 AUD)
0% transaction fees are an easy trick to fall for. Everything looks normal and above board. If anything, it looks like you're getting a great deal. Look a little closer and there's a couple of red flags. That 0% fee is really there to distract you from a hidden, marked up exchange rate. And it's almost always guaranteed to cost you more.
By presenting their own inflated rate as the exchange rate, banks ensure you never see the exchange rate margin as a cost. It's this lack of information that stops you from making an informed choice. The bottom line? If you see a 0% fee, be cautious.
AUSTRALIA'S TRANSPARENCY PROBLEM
While other G20 nations move toward clearer standards, Australia slips backwards. In 2025, our price transparency rating was downgraded from 2/5 to 1/5.
Why? Our current 'Best Practice Guidance' from the ACCC is voluntary and does not require margin disclosures. That means providers don't have to disclose foreign exchange markups. So they choose to ignore it, continuing to obscure the largest component of total transfer costs: the hidden margin.
G20 Transparency Rankings: Australia vs UK
$6B LOST
That's coming right out of Australia's pockets. This isn't just about a few dollars here and there. The scale of this leakage is staggering.
Independent research indicates that this lack of transparency will contribute to nearly $6 billion lost through hidden fees in 2025 alone by Australian consumers and small businesses. By 2027, that figure is projected to rise even higher.
This is money that could support local businesses, pay for family holidays, or help exporters grow. Price transparency is the key to competition. Without it, it's nearly impossible for market forces to lower costs for the everyday person.
The Hayne Royal Commission was meant to signal the end of an unacceptable culture in Australian banking. It established core principles that banks should not mislead or deceive customers and must act fairly. Yet, when it comes to international payments, the spirit of these findings is systematically ignored.
By advertising '$0 fee' transfers while quietly baking markups over 4% into the exchange rate, banks have effectively swapped the 'fees-for-no-service' scandal for a 'fees-for-no-fee' deception. This deliberate information asymmetry is the exact behavior the Commission sought to eliminate, and its persistence is a major reason why Australians lost an estimated A$6 billion to hidden FX fees in 2025 alone.
WISE VS. THE STATUS QUO
At Wise, we believe you deserve the truth. We use the mid-market rate - the one you find on Google - and we charge one upfront, transparent fee.
Our recent research from January 2026 shows just how wide the gap has become. If you send money abroad from Australia, Wise is, on average, 75% cheaper than major banks. Wise is 75% cheaper when you spend abroad, too. Here's the total cost — including both transaction fees and exchange rate markups - to send $1,000 AUD to USD, EUR, and GBP.
Total Cost to send $1,000 AUD (including fees & markups)
Savings based on a rate comparison with select competitors in Jan 2026. To learn more please visit wise.com/compare.
A CALL FOR ACTION
We're calling on the Australian government and regulators to move beyond voluntary guidance. We need mandatory disclosure of all fees including FX markups against a uniform, independent benchmark rate.
Australians deserve a financial system built on honesty, not one that relies on hiding the bill. It's time to stop the leak and bring transparency to our economy.
Money without borders
Find out more
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