Personal Finance Tips

The cheapest ways to exchange currency in the UK

Gert Svaiko

07.06.24

Read time 2 minutes

If you’re preparing for a holiday outside of the UK, you’re likely also looking to sort out your travel money. One of the most important things to think through is how you’ll be converting pounds to the local currency you’ll be using.

Finding a way to exchange money without paying high fees and unfair rates can be quite challenging, but not impossible. Read our guide and find out what’s the best way to exchange currency in the UK without overpaying.

The cheapest ways to exchange currency in the UK

One of the best ways to save up when exchanging currency is to check a reputable currency converter as your first step. This will allow you to find out what the mid-market exchange rate is and look for a provider with the closest offer to it.

Based on this, you can start exploring your options. Some of the most popular currency exchange companies in the UK are Travelex, eurochange and Currency Online Group. They all offer better rates than your typical high street bank.¹

The money services provider Wise also offers great deals when it comes to travel money, with low and transparent fees. Thanks to the auto-conversion feature, you can spend like a local during your travels.

If you prefer relying on cash only, you could stop by your local exchange bureau and check their offer. However, make sure you avoid exchanging currency at the airport before leaving, since their rates are rather unfavourable.

Can you avoid currency conversion fees?

Instead of thinking about how to avoid currency conversion fees, it’s better to focus on paying the least amount possible. When providers claim they offer fee-free exchange, that’s likely untrue and they’re adding to the charges through their exchange rate mark-up or spread.

UK banks that exchange foreign currency for free

There are certain banks that exchange foreign currency for free if you’re already their client. However, make sure you check their exchange rates to make sure you’re getting a good deal.

For instance, NatWest doesn’t charge conversion fees, but some costs are already built into the rate applied to the Foreign Exchange transfer.²

Lloyds Bank also offers fee-free currency exchange. They can deliver the money to your UK home address for free as well.³

Sainsbury’s Bank doesn’t charge their clients commission fees for buying currency. If you plan on exchanging more than £400, you can even get free home delivery. Nectar members can also get better exchange rates.⁴

clerk-giving-cash-to-customer-at-currency-exchanger

How to skip having to exchange cash for travelling abroad?

Having the local currency in cash when travelling is one of the ways you can bring your travel money. However, if you find it more convenient to tap a card or your phone when paying, here are some other options:

Travel money option	Benefit
Credit cards	Section 75 protection⁵
Debit cards	Spending and withdrawing almost anywhere
Prepaid travel cards	Spending without overstepping your budget
Apple Pay	Safer than physical cards and convenient
Google Pay	Safe and convenient, great option if you don’t own an iPhone

If you want to avoid high exchange rate markups and fees when converting money or spending abroad, the Wise card might be another great solution for you. This clever international debit card works in 150+ countries and automatically converts your pounds to local currency with only a small, transparent conversion fee.

How to find the closest currency exchange?

If you plan on exchanging money at a bank or a currency exchange company, you can check on their website where their closest branch is. You’ll find the most options in London and other big cities. Depending on where you live, you might need to plan a trip to exchange currency.

You can also open Google Maps and type in “currency exchange near me” to locate the nearest physical currency exchange locations.

You’re now prepared for saving up when exchanging currency in the UK. All that’s left is to pack your bags and relax, because your budget is under control.

Sources used:

Forbes - Where to exchange currency without paying huge fees
NatWest - Foreign exchange
Lloyds Bank - Order travel money
Sainsbury’s Bank - Currency converter
Money Saving Expert - Section 75 refunds

Sources last checked on date: 17-May-2024

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