Are you understanding all the costs involved in your international business payments?

20-05-2020 | treasuryXL | XE |

As you search for the right payment provider, keep an eye out for these two main sources of cost: fees and exchange rate.

When making an international payment, there’s one question that’s on everyone’s mind:

“How much foreign currency will I get for my money, after all the charges have been applied?” 

The answer could surprise you.

When making an international business payment, the actual payment itself is only one part of the overall cost to your business. Depending on the provider you utilise for your payment, the exchange rate that you get for your transfer as well as the fees you’ll need to pay (their cost and the number of fees) can vary drastically.

As you search for the right payment provider, keep an eye out for these two main sources of cost: fees and exchange rate.

Fees—the charges you see 

When making an international transfer, a multitude of fees, charges or commission can apply, both for the sender and the recipient.

It can get complicated, as fees can come about in multiple ways. Providers may levy lots of small charges to disguise exactly how much the transfer cost. Some providers may instead apply their fees to the recipient, meaning that less money will come out on the other end of your transfer than anticipated.

When you get your transfer quote, look carefully at the fees that you see throughout the transaction—not just the ones advertised upfront.

Exchange rates—the charges you don’t see 

For many people making international payments, the exchange rate is the deciding factor in which provider they use.

As you search for the right international payment provider, be mindful of the way that they communicate their costs. It’s more common than you think for providers to offer “commission free” or “fee free” transfers that in fact just give you unfavourable exchange rates in return.

As a result it’s often really difficult to compare one provider with another as some will publish charges and others don’t.

Remember exchange rates often change by the minute, so to compare one company to another you need to do the comparison one after the other in quick succession.

What should you look out for? 

When shopping around and comparing your bank to a currency broker, make sure you look at both fees and rates. Compare the costs across providers—even if some claim to use the mid-market exchange rate for their transfers, you’ll find that rates can differ wildly.

Additionally, be mindful of anything that seems “too good to be true”. While some providers will offer you great deals and discounted rates, if you see a provider claiming absolutely no fees, “free transfers”, or advertising rates that are dramatically lower than the rates you see with other providers, it may be an indicator that there are extra, hidden costs.

What will it cost to send money with Xe? 

At Xe, we want to help you to get the most for your money when you make an international payment. Our money transfers come at competitive exchange rates, and we offer money transfer solutions that can help you to ensure that you’ll get a great rate for your transfer. You can lock in a rate for a future transfer with a forward contract, or you can set a Rate Alert to get notified when the rates are in your favour. Currency market volatility can cost you, but working with a knowledgeable provider can help you to minimise the costs.



Get in touch with XE.com

About XE.com

XE can help safeguard your profit margins and improve cashflow through quantifying the FX risk you face and implementing unique strategies to mitigate it. XE Business Solutions provides a comprehensive range of currency services and products to help businesses access competitive rates with greater control.

Deciding when to make an international payment and at what rate can be critical. XE Business Solutions work with businesses to protect bottom-line from exchange rate fluctuations, while the currency experts and risk management specialists act as eyes and ears in the market to protect your profits from the world’s volatile currency markets.

Your company money is safe with XE, their NASDAQ listed parent company, Euronet Worldwide Inc., has a multi billion-dollar market capitalization, and an investment grade credit rating. With offices in the UK, Canada, Europe, APAC and North America they have a truly global coverage.

Are you curious to know more about XE?
Maurits Houthoff, senior business development manager at XE.com, is always in for a cup of coffee, mail or call to provide you detailed information.

 

 

Visit XE.com

Visit XE partner page

 

 

 

Market movements could impact your business—stay on top with Rate Alerts

06-05-2020 | treasuryXL | XE |

Rate Alerts are a quick, simple way to monitor the changing values of your choice currencies, without having to constantly check the markets.

If your business purchases goods or services from overseas, makes income from overseas, or deals at all with foreign currencies, exchange rate movements can and will impact your business and its bottom line. The degree to which they’ll affect your business will depend on the types of transactions you’re making, the frequency of your transactions, and the currencies that you most commonly work with. But if you aren’t aware of the latest changes in the currency markets, your next payment could be quite a bit more costly than anticipated.

While it is crucial to monitor the values of the currencies you work with and stay on the pulse of movements in the currency markets, we understand it’s not always feasible to keep an eye on them. The currency markets are constantly in motion, and currency values can change multiple times per day, or even multiple times per hour. Who has time to constantly check the latest rates?

Fortunately, you don’t need to devote your time to monitoring the markets. With Xe’s Rate Alert tool, we can handle it for you, so you can devote your time to your business.

What are Rate Alerts? 

Rate Alerts are a quick, simple way to monitor the changing values of your choice currencies—without having to constantly check the markets.

At Xe, we know the currency markets, and we’re happy to keep an eye on them for you. All you need to do is identify which currency pairs you’d like to monitor and your target exchange rates, and we’ll take care of the rest. We’ll watch the markets for you and notify you the moment your ideal rate is reached.

Want to give it a try now? 

Log in

Why set up a Rate Alert? 

By setting a Rate Alert, you’re ensuring that you’ll know when it’s a good time to make your transfer. The currency markets can be volatile, and one change in currency values could have a dramatic impact on how much your business needs to pay for one transaction. If you have some flexibility in the timing of your payment, Rate Alerts will help you to determine when the rates are most favourable, so you can make the most of your money.

In addition to helping you save money, Rate Alerts will also free up valuable time. Rather than frequently checking the markets and poring over historic currency data, you can take just a couple of minutes now to set up your Rate Alerts. You’ll know as soon the rates are in your favour, without ever having to take time away from your business.

How to set up a Rate Alert 

If you have your Xe account, signing up for a Rate Alert is quick and simple.

  1. Sign in or sign up. If you haven’t registered, don’t worry. It’ll take just a few minutes.

  2. Head to the Rate Alerts section. If you’re using the Xe app, you’ll enter through the ‘Charts’ tab.

  3. Select your currency pair and set your target rate. You can either manually enter the rate you’d like or select a point on the chart.

  4. Sit back and wait. We’ll be in touch as soon as your rate is reached.

Get Started



Get in touch with XE.com

About XE.com

XE can help safeguard your profit margins and improve cashflow through quantifying the FX risk you face and implementing unique strategies to mitigate it. XE Business Solutions provides a comprehensive range of currency services and products to help businesses access competitive rates with greater control.

Deciding when to make an international payment and at what rate can be critical. XE Business Solutions work with businesses to protect bottom-line from exchange rate fluctuations, while the currency experts and risk management specialists act as eyes and ears in the market to protect your profits from the world’s volatile currency markets.

Your company money is safe with XE, their NASDAQ listed parent company, Euronet Worldwide Inc., has a multi billion-dollar market capitalization, and an investment grade credit rating. With offices in the UK, Canada, Europe, APAC and North America they have a truly global coverage.

Are you curious to know more about XE?
Maurits Houthoff, senior business development manager at XE.com, is always in for a cup of coffee, mail or call to provide you detailed information.

 

 

Visit XE.com

Visit XE partner page

 

 

 

Choosing the right international business payments provider: what should you check for?

29-04-2020 | treasuryXL | XE |

Once you’ve ascertained what you need from a provider, the next step is shopping around to select the best provider for your business.

Working with a foreign exchange (FX) specialist can greatly help your business to navigate the currency markets and protect your bottom line from potential market volatility. However, not all providers are the same because not all businesses are the same. Each business has its own currency needs and risk exposures dependent on its size, operations, and planned payments.

We recently offered a guide on understanding what you need from an international payments provider. We encouraged you to consider:

  • Overhead visibility of your FX requirements

  • How you prefer to conduct business

  • The simplicity (or complexity) or your FX requirements

  • The payments your business makes or will make.

All of these factors can greatly impact what you’ll need from an FX provider to suit your business.

Once you’ve ascertained what you need from a provider, the next step is shopping around to select the best provider for you. In addition to considering whether they can meet your needs, be discerning about each provider and whether they should be trusted with your business’s international payments.

Do your due dilligence 

As with any financial services company, do your research and use your best judgment. If something feels off, it very well could be. If the rate looks too good to be true, it probably is. There are some other questions that you should ask yourself as you research each provider:

  • Are they registered? Companies that provide money transfer services in the UK, for example, have to be registered with the Financial Conduct Authority (FCA). You can check which ones are authorised on their site. If you deal with a firm that is authorised or regulated by the FCA, you will be covered by the Financial Ombudsman Service if something goes wrong. Confirm that the provider is registered with your country’s authority.

  • Are they authorised? Larger companies are called an “authorised payment institution” while smaller ones are listed as “small payment institutions”. All authorised payment institutions must meet obligations that include providing certain information to customers before they commit to using the service. This includes whether they safeguard client money, what exchange rate they will provide and whether there will be any additional charges, how the transaction will be carried out, how long the money will take to arrive, how long they will take to correct a transaction in the event of a mistake and your rights to cancel a transaction.

  • How does their site look? You can also take a look at the company website to see if there are any additional security measures in place. Looking at their site will also give you a quick snapshot of the business. If their site is outdated or poorly-run, it could reflect poorly on their business practices.

  • Can you call? Sometimes, the quickest way to get a feel for a provider is to speak with them directly. Giving the company a quick call is another way to check you are comfortable trusting them with your money and to get answers to any questions you might still have about their service. This call will also give you an idea of whether you would be able to speak to someone if you do encounter any issues with your transfer.

What should you check before deciding which provider to use?

  • How strong is the company’s balance sheet? If they don’t have full accounts on their website, you can check at Companies House. Xe, for example, is owned by NASDAQ-listed global payments processing company Euronet Worldwide Inc.

  • How big are they and how long have they been in business? A large, established company with experience in the markets will likely be better-equipped. At Xe, we’ve been in the business for almost 30 years now with offices around the world to serve our customers.

  • How good is their payment processing? Are they audited by reputable auditors? Can they send payments quickly and securely?

  • How many other businesses trust them with their international payments needs? Judge them by the company they keep. Do they work with any other reputable businesses? Do they have experience working with businesses like yours? Xe for example, serves over 13,000 businesses of all sizes across 100 industry sectors.

  • What online security measures do they have in place to keep your funds safe? Look out for well-known online security ‘trust marks’ such as Norton online security. For example, if the site URL begins with “https”, that makes it a secure site. A URL beginning with “http” is a warning sign of an insecure site, which you should not give your sensitive information to.

What should your business know about Xe? 

At Xe, we know the currency markets. With nearly 30 years in the business, we are the world’s trusted authority with the knowledge and experience to help businesses navigate the currency business and their international payments. Today, over 13,000 businesses across 100 industry sectors look to Xe for:

  • Fast, secure and simple international payments

  • Tools and solutions to manage their currency needs

  • Expert FX risk management guidance



Get in touch with XE.com

About XE.com

XE can help safeguard your profit margins and improve cashflow through quantifying the FX risk you face and implementing unique strategies to mitigate it. XE Business Solutions provides a comprehensive range of currency services and products to help businesses access competitive rates with greater control.

Deciding when to make an international payment and at what rate can be critical. XE Business Solutions work with businesses to protect bottom-line from exchange rate fluctuations, while the currency experts and risk management specialists act as eyes and ears in the market to protect your profits from the world’s volatile currency markets.

Your company money is safe with XE, their NASDAQ listed parent company, Euronet Worldwide Inc., has a multi billion-dollar market capitalization, and an investment grade credit rating. With offices in the UK, Canada, Europe, APAC and North America they have a truly global coverage.

Are you curious to know more about XE?
Maurits Houthoff, senior business development manager at XE.com, is always in for a cup of coffee, mail or call to provide you detailed information.

 

 

Visit XE.com

Visit XE partner page

 

 

 

How to make a quick business payment with a spot transfer

22-04-2020 | treasuryXL | XE |

Need to quickly send money overseas? A spot transfer may be the right payment solution for you.

In an earlier article, we went into depth on forward contracts, what they are, when you might want to use one for your business, and how to set one up. But they aren’t the only way to make an international business payment. You might be in a rush and want to send your transfer right now, as soon as possible, rather than scheduling a future transfer.

In that case, you would want to set up a spot transfer.

What is a spot transfer?

A spot transfer is the quickest, most simple way to make a business payment. You get your quote and confirm your money transfer, and then the currency will be purchased and sent as soon as possible.

Learn More

Why might you use a spot transfer? 

As the name indicates, you’d want to use a spot transfer when you need to make a quick payment “on the spot”. There’s no preliminary work involved, nor would you need to do anything after confirming the transfer. All you need to do is enter your currencies, let us know how much you’d like to send and provide your payment method, and we’ll handle the rest.

Additionally, not all currencies or currency pairs experience the same amount of market volatility. If you’re consistently sending payments in a certain currency and haven’t seen much fluctuation in the rates or your costs, you might not need to set up a forward contract or market order to avoid future market volatility. A quick, simple spot transfer could be all you need.

How do you send a spot transfer?

Befitting their quick nature, spot transfers are quick and easy to initiate.

  1. Sign in to your Xe business account. If you don’t have one, sign up. You can view a detailed guide to everything you’ll need to get started here.

  2. Get your quote. Enter your currencies and the amount you’d like to send to see the send rate for your transfer.

  3. Double-check everything. Before confirming your payment, confirm that all information is correct. This will include your currencies, the amount you’d like to send, the exchange rate, your recipient’s information, and your payment information.

  4. Confirm your spot transfer. If you’re satisfied with your transfer, you can go ahead and confirm it.

Once you’ve confirmed your transfer, we’ll take care of the currency exchange and send it to your recipient.

Get Quote

What other kinds of transfers are there? 

Spot transfers are the ideal payment method for quick, simple money transfers. However, if you’re interested in scheduling a payment for a future date, seeking the best exchange rate, or avoiding potential market volatility, spot transfers may not be the best option to meet all of your currency needs.

Are you interested in scheduling a payment for a future date? You may be interested in forward contracts.

Or would you like to wait for the best possible rate? You might be interested in a market order. Watch this space for an upcoming guide to those.

Get Started



Get in touch with XE.com

About XE.com

XE can help safeguard your profit margins and improve cashflow through quantifying the FX risk you face and implementing unique strategies to mitigate it. XE Business Solutions provides a comprehensive range of currency services and products to help businesses access competitive rates with greater control.

Deciding when to make an international payment and at what rate can be critical. XE Business Solutions work with businesses to protect bottom-line from exchange rate fluctuations, while the currency experts and risk management specialists act as eyes and ears in the market to protect your profits from the world’s volatile currency markets.

Your company money is safe with XE, their NASDAQ listed parent company, Euronet Worldwide Inc., has a multi billion-dollar market capitalization, and an investment grade credit rating. With offices in the UK, Canada, Europe, APAC and North America they have a truly global coverage.

Are you curious to know more about XE?
Maurits Houthoff, senior business development manager at XE.com, is always in for a cup of coffee, mail or call to provide you detailed information.

 

 

Visit XE.com

Visit XE partner page

 

 

 

How to understand what you need from a business international payments provider

15-04-2020 | treasuryXL | XE |

To get the best from any international payments specialist and most effectively manage your organisation’s currency risks, take some time to think about what you need from the company you choose to work with.

Not all business international payments providers are the same—and neither are all businesses. Your business’s size, the industry you work in, the types of payments you want to make, your knowledge of the currency markets, and your general preferences for how you conduct business are just a few factors to consider when looking for the right provider.

To make sure you get the best from any international payments specialist and can most effectively manage your organisation’s currency risks, take some time to think about what you need from the company you choose to work with.

Ask yourself:

  • How much forward visibility do you have of your foreign exchange requirements?
  • How do you prefer to conduct your business—online, over the phone, or in person?
  • How simple (or complex) are your requirements?
  • What kind of payments does your business make?

How much forward visibility do you have of your FX requirements?

Are you actively looking to the future to strategize for future payments, or do you handle each payment as it comes? For example, if your business buys and sells currency as and when you make transactions (such as buying or selling goods and services), you may want to look for a clean, easy-to-use online platform that offers competitive rates for quick transactions.

On the other hand, if your business is considering its long-term FX risk management strategy and you anticipate new requirements in the future, you may benefit from a more hands-on approach that includes not just online service but also a team of foreign exchange experts to act as your eyes and ears in the market and a range of payment services (such as forward contracts and market orders).

How would you prefer to conduct business?

Would you prefer to quickly take care of your transactions online? Or would you prefer to speak with another person who can answer your questions and build a relationship with your business? Would you like both? What about 24/7 service?

These are all features you can find in FX providers. Consider which ones make the most sense for your business and would make you feel the most comfortable as you make payments.

What are your FX requirements?

If you do a little research, you’ll see that there are countless products and features available to businesses. While they play a key role in some business’ FX strategies, not every business uses them, or even needs them.

Too often, businesses end up confused by overly complex features and functionality they never use, when all they really wanted was the ability to make simple international payments and get great rates. Or other businesses work with providers that aren’t sophisticated enough to cater to their needs, and don’t fully address their risks. Consider some of the following:

  • Are you a voracious consumer of market information? You’ll want a provider that provides plenty of information (whether online or over the phone) to keep you up to date with the latest exchange rate movements. If the currency markets overwhelm and don’t interest you, you may be better suited to a more streamlined service.
  • Is your business opportunist in its approach to buying and or selling currency or does it actively manage its foreign exchange exposure in order to hedge its currency risk? Do you require post trade flexibility to split orders or roll trades?
  • Does your business require flexible user access rights to match internal safeguards and processes or do you simply require a single login?

And that brings us to the most important question of all…

What kind of payments are you making?

Your international payments provider needs to help you make the payments the way you’d like to. Ask yourself:

  • How frequently are you making payments?
  • What countries are you making payments to? Which currencies?
  • Are you interested in locking in rates for future transfers, or scheduling transfers to send once a certain rate is live? Or would you rather make quick payments on the spot?
  • Are you comfortable making these transactions yourself, or would you like help from your provider?

How can Xe help your business?

At Xe, we have a simple, easy-to-use platform where you can initiate quick transactions 24 hours a day, 7 days a week. If you’re looking for more specialized solutions, we also offer multiple money transfer products and services. We work with each business to ensure that they receive the strategy that they need, whether they’re a sole proprietor or a large corporation.

Get Started


Get in touch with XE.com

About XE.com

XE can help safeguard your profit margins and improve cashflow through quantifying the FX risk you face and implementing unique strategies to mitigate it. XE Business Solutions provides a comprehensive range of currency services and products to help businesses access competitive rates with greater control.

Deciding when to make an international payment and at what rate can be critical. XE Business Solutions work with businesses to protect bottom-line from exchange rate fluctuations, while the currency experts and risk management specialists act as eyes and ears in the market to protect your profits from the world’s volatile currency markets.

Your company money is safe with XE, their NASDAQ listed parent company, Euronet Worldwide Inc., has a multi billion-dollar market capitalization, and an investment grade credit rating. With offices in the UK, Canada, Europe, APAC and North America they have a truly global coverage.

Are you curious to know more about XE?
Maurits Houthoff, senior business development manager at XE.com, is always in for a cup of coffee, mail or call to provide you detailed information.

 

 

Visit XE.com

Visit XE partner page

 

 

 

How can Xe help your manufacturing business with its international payments and FX requirements?

08-04-2020 | treasuryXL | XE |

Xe can help businesses in the manufacturing sector to make quick international payments and prepare for currency market volatility.

How can exchange rate movements affect your business? If your business operates in multiple countries, imports or exports goods or services abroad, or deals with foreign currencies in any capacity, exchange rate movements can have a significant impact on your business’s operations and bottom line.

Let’s consider how exchange rate movements could impact manufacturers who regularly purchase products and parts. Even if the costs of these parts and products remain steady, currency values will not. The currency markets are constantly in flux, and volatility in the markets could increase the costs of your imports, or even reduce your profitability.

In addition to preparing for potential market volatility, an experienced foreign exchange and international payments provider can also provide your business with a quick, reliable and cost-effective way to make your business payments, and help you to come up with a strategy to minimize your risk exposures and effectively plan for future FX outcomes.

What can a manufacturing business do to improve its FX outcomes?

The first step is finding the right international payments and foreign exchange provider. Just as each business is different, each provider is different, and the right provider for your business will have the right tools and services to help your business craft the strategy that suits your business’s needs.

At Xe, we understand that each business has its own FX requirements. Today, we work with over 13,000 businesses of all sizes across all industry sectors and offer each one the products, services, and guidance that it needs for its operations.

We can help your manufacturing business:

  • Maintain steady importing costs;

  • Save time on your international payments with our quick and easy transactions;

  • Save money on your international payments with better rates and fees than what your bank would offer.

Learn More

What Xe can do for your manufacturing business

In addition to offering our experience and expertise to help your business craft its own foreign exchange strategy, we also offer up an array of products and services that include:

  • Spot transfers, so you can purchase currency and send your international payments quickly, easily, and “on the spot”.

  • Market orders, so you can set a target exchange rate for an automatic transfer once it’s been reached, so you can secure the rates you want for your payments that aren’t time-sensitive.

  • Forward contracts, so you can lock in today’s exchange rate and schedule a future transfer on that date and ensure that your payment will send on time and you can avoid potential market volatility.

  • Risk management, so our team of currency experts can create a customized risk management strategy for your business’s foreign exchange needs, and you can devote your time to your business.

Get Started

 

Get in touch with XE.com

About XE.com

XE can help safeguard your profit margins and improve cashflow through quantifying the FX risk you face and implementing unique strategies to mitigate it. XE Business Solutions provides a comprehensive range of currency services and products to help businesses access competitive rates with greater control.

Deciding when to make an international payment and at what rate can be critical. XE Business Solutions work with businesses to protect bottom-line from exchange rate fluctuations, while the currency experts and risk management specialists act as eyes and ears in the market to protect your profits from the world’s volatile currency markets.

Your company money is safe with XE, their NASDAQ listed parent company, Euronet Worldwide Inc., has a multi billion-dollar market capitalization, and an investment grade credit rating. With offices in the UK, Canada, Europe, APAC and North America they have a truly global coverage.

Are you curious to know more about XE?
Maurits Houthoff, senior business development manager at XE.com, is always in for a cup of coffee, mail or call to provide you detailed information.

 

 

Visit XE.com

Visit XE partner page

 

 

 

How to get a quote for fast and secure money transfers for your business

01-04-2021 | treasuryXL | XE |

By signing up for a free Xe Business account, you can quickly and easily get quotes for fast money transfers for your business’s international payments.

Getting a quote is the first step to making a business international payment. And while it may sound simple enough, if you don’t know where to begin or who can help you get a quote, it can quickly grow overwhelming.

We understand that you might not have the time to learn all about the process before getting a quote. We’re here to make it quicker and easier for you, so you don’t have to take any time away from your business.

There are a few questions you should ask yourself first:

  • Do you know what type of payment you’ll need to make?
  • Do you know where to go to get a good exchange rate for your transfer (or even that you can shop around for rates)?
  • Are you working with a knowledgeable foreign exchange provider that can help you find the best rate and choose the right payment solutions for your business?

At Xe, we can help you with all of the above. Here’s how you can get a quote for your business’s next international payment.

Learn More

How to sign up for an Xe business account

Before you can get a quote, we’ll need you to sign up for an account so we can understand what your business is looking for. Fortunately, an account is free and signing up will take just a few minutes. We’ll ask you for some information about your business. This will vary, but these details typically include:

  • Registered business name
  • Country of registration
  • Registration number
  • Type of business
  • Nature of business

Once you’ve filled that in, we’ll then want to know some information about you. In order to create an Xe Business account, you will need to be a director. We’ll ask for:

  • Your name
  • Your title
  • Your mobile phone number
  • Your date of birth
  • Your address
  • The email address and password you’ll use to sign in.

One last step to go—we’ll prompt you to provide:

  • Where you’ll be sending money from
  • The currencies you’re expecting to send
  • How many transfers you’re planning to send.

Once that’s been submitted, one of our team members will get in touch with you, typically within the day. We’ll confirm the details you provided and, once that’s completed, you’ll be all set to start making payments.

Get Started


How to get a quote for your business

Good news! Once you’ve signed up, getting a quote is quick and easy.

  1. Sign in to your account.
  2. Select the currencies you’d like to exchange.
  3. Enter the amount you plan to send.

That’s all! The send rate and cost for your transfer will pop up automatically. If you’re happy with the quote and want to proceed with your payment, hit “New Transfer” to continue on to making your transaction.

Get Quote

We hope this has helped break the process down for you. If you have any questions or need additional assistance with your payments, you can also contact our team by phone or by email.

 

Get in touch with XE.com

About XE.com

XE can help safeguard your profit margins and improve cashflow through quantifying the FX risk you face and implementing unique strategies to mitigate it. XE Business Solutions provides a comprehensive range of currency services and products to help businesses access competitive rates with greater control.

Deciding when to make an international payment and at what rate can be critical. XE Business Solutions work with businesses to protect bottom-line from exchange rate fluctuations, while the currency experts and risk management specialists act as eyes and ears in the market to protect your profits from the world’s volatile currency markets.

Your company money is safe with XE, their NASDAQ listed parent company, Euronet Worldwide Inc., has a multi billion-dollar market capitalization, and an investment grade credit rating. With offices in the UK, Canada, Europe, APAC and North America they have a truly global coverage.

Are you curious to know more about XE?
Maurits Houthoff, senior business development manager at XE.com, is always in for a cup of coffee, mail or call to provide you detailed information.

 

 

Visit XE.com

Visit XE partner page

 

 

 

How can Exchange rate movements affect your business?

11-03-2021 | treasuryXL | XE |

If your business works with international currencies, your business could be impacted by exchange rate movements.

Does your business:

  • Make income from overseas operations?
  • Import or export goods and services from abroad?
  • Pay overseas invoices?
  • Or interact with foreign currencies in any way?

If so, your business can be impacted by exchange rate movements. Whether you’re a sole proprietor or a large corporation, in manufacturing or healthcare, you will face some level of foreign exchange risk when making international payments.

What is foreign exchange risk?

It’s exactly what it sounds like: it’s the possibility that a business’s financial position or performance could be negatively impacted by fluctuations in exchange rates in the foreign currency markets. As the saying goes, the markets never sleep. Exchange rates are prone to fluctuations at any given moment, and while experts can forecast where they think currency values might go, you can’t predict where the rates could go—or what it could mean for your business. Let’s take a look at a few examples.

How does a falling domestic exchange rate affect your business?

A falling domestic exchange rate can:

  • Increase costs for importers and potentially reduce their profitability.
  • Make domestically produced products more competitive against imported products.
  • Increase the cost of capital expenditure (for example, if it includes the importation of capital equipment).
  • Increase the cost of servicing foreign currency debt.
  • Improve exporter competitiveness.
  • Make a business a more attractive investment proposition for foreign investors.
  • Increase the costs of investing in overseas operations.

How does a rising domestic exchange rate impact your business?

On the other hand, a rising domestic exchange rate can:

  • Make exports less competitive, reducing exporter profitability.
  • Decrease the value of investment in foreign subsidiaries and monetary assets (when translating the value of such assets into the domestic currency).
  • Reduce foreign currency income from investments.
  • Reduce the cost of foreign raw materials, giving importers a competitive advantage.
  • Reduce the value of foreign currency liabilities and hence the cost of servicing these liabilities.
  • Reduce the cost of capital expenditure (for example if it includes the importation of capital equipment).
  • Make a business less attractive to foreign investors.

Did you notice anything? No matter which direction the exchange rate is moving, it could have the potential to impact your business—and your bottom line.

How can you protect your business from market volatility?

No one can predict how the markets will move, but a knowledgeable FX provider can give your business the guidance and solutions to help you to make informed decisions to minimize the impact of market motion.

Are you curious to know more about XE?

Maurits Houthoff, senior business development manager at XE.com, is always in for a cup of coffee, mail or call to provide you detailed information.

 

 

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Who sets the rates? Common questions about currency exchange rates

18-02-2021 | treasuryXL | XE |

Ever wondered where the rates come from, and how they can impact you?
We answer some common questions in this guide to exchange rates.

Who’s in charge of setting currency exchange rates? If you’ve ever sent money overseas or checked the rates, this is a question that may have definitely crossed your mind. Who decides what is the value of money, and why do rates fluctuate that much during the day?

It’s normal to wonder, and fortunately for you, we’ve got the answers to those questions and more.

How do currency exchange rates work?

Every country in the world has its own currency, and each of these currencies is valued differently. When you exchange one currency for another, you’re actually buying money, just in a different currency than the one used in your country.

The exchange rate tells you how much the currency used in your country is worth in foreign currency. The rates constantly change for some countries, whereas others use fixed exchange rates. As a rule of thumb, a country’s social and economic outlook is the main factor that influences the currency exchange rate.

That’s the quick answer. If you’re in the mood for a more in-depth look, check out our previous blog post.

What are the main types of exchange rates?

The main types of rates are variable (or flexible) and fixed rates.

Most countries have variable currency exchange rates, which are determined by the foreign exchange market. Because these rates are flexible, they fluctuate every minute, often influenced by market movements, political events, economic forecasts, and more.

Countries such as the U.S., the United Kingdom, Canada, Japan, and Mexico all use flexible exchange rates. It’s important to note that even though government policies can influence currency exchange rates, the government can’t actually regulate them. The rates are always determined by Forex traders on the foreign exchange market.

Several countries use fixed currency rates, and that is because the government dictates when the rates change. This is the case for the Saudi Arabian riyal, for example. The fixed rates are pegged to the U.S. dollar, and the central bank in the countries that use this system holds U.S. dollars to keep the rate fixed.

How do forex traders establish currency exchange rates?

The market forces of supply and demand are the main factors that determine currency exchange rates. The level of demand for a currency determines its value in relationship with other currencies. For example, if the demand for British pounds by Americans increases, the supply-demand forces will cause an increase of the British pound’s price in relation to the dollar.

The exchange rates between two countries are affected by countless factors, both geopolitical and economic. Some of the most common of them include:

  • Inflation reports

  • Interest rate changes

  • Gross domestic product numbers

  • Unemployment rates.

Forex traders take all these factors and more into account when establishing currency exchange rates. If a country has a strong economy that’s growing, investors will be interested in buying its goods and services, which means that they’ll need more of its currency.

On the other hand, when a country has an unstable economy, investors will be put off and less willing to invest, which means that the currency will not be highly valued. Investors always want to make sure they will get paid back before deciding to hold government bonds in a particular currency.

How do exchange rates affect you?

The value of money affects every individual on a daily basis, as the prices of essentials such as groceries and gas at the pump are correlated to it. When the value of money declines steadily over time, it causes inflation, and the result of that is a price increase for everything, including basic goods.

If you’re traveling or making a payment to another country that uses a different currency, it’s important to check for exchange rate values and plan your finances accordingly. Many people check whether the currency of the country of their destination is strong or weak before booking a vacation. That’s because a weak currency in the destination country means that you can buy more of it with your own currency, so you have more money to spend on your trip.

How can you get the best rates when sending money overseas?

As we’ve said before, unfortunately there’s no specific time where you can guarantee you’ll get a great rate. But there are a few things you can do to help yourself out.

If you’re transferring money to someone in another country, you need to look carefully at your options, as some transfer methods are more expensive than others. For example, if you’re using your bank to make a transfer, you’ll often need to pay a fee on top of the exchange rates set by the bank, which are usually disadvantageous.

By using an online money transfer service such as Xe, you can save money on fees and get great exchange rates. Your money will also reach its destination faster, and the entire process of making the transfer is easy both on the website and the mobile app.

Are you curious to know more about XE?
Maurits Houthoff, senior business development manager at XE.com, is always in for a cup of coffee, mail or call to provide you detailed information.

 

 

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How do Foreign currency exchange rates work?

11-02-2021 | treasuryXL | XE |

Ever checked the rates and wondered what’s happened to give you the rate you see? Here we break it down for you—and try to make it as simple and painless as possible.
If you’re traveling abroad for a holiday, need to pay for a school fee in another country or you want to buy an item from a foreign country,  you will need a currency exchange to carry out your transaction. But how can you tell the exact amount your currency is worth when it is exchanged into a foreign currency? And who’s setting them?

For the first question, you can easily do that on Xe’s Currency Converter. The second question? That’ll take a little more time to understand. We’ll try to make it as quick (and painless) as possible for you!

Currency exchange rates: what they are, and how they work

Exchange rates indicate how much your currency is worth if exchanged into a foreign currency. For example, on December 30, 2020, 1 U.S. dollar was equal to 0.748067 British pounds.

Currency exchange transactions happen 24 hours a day, seven days a week in a market that transact over $6 trillion a day. Exchange rates are constantly fluctuating as foreign currencies are actively traded. Various trading activities boost or lower the values of different currencies.

Institutions and traders buy and sell foreign currencies in the global market 24 hours a day. For a trade to be completed, at least one currency must be exchanged for another. For example, in order to buy the U.S. dollar another currency is required for payment. Whatever currency is used, either the euros, yen, or Canadian dollar, etc. will create a currency pair. For example, if you use U.S. dollars (USD) to buy the Japanese yen, the exchange rate will be for the JPY/USD pair.

How are international exchange rates determined?

Foreign exchange rates are determined in various countries using two key methods: flexible and fixed rate. While flexible exchange rates are constantly changing, fixed rates hardly ever change. (Though you probably figured that out from their names.)

Flexible exchange rates

The foreign exchange market or forex determines most currency exchange rates. These rates are known as flexible exchange rates. These rates are constantly changing from one moment to the next. Flexible exchange rates are influenced by the open market through demand and supply on world currency markets. As such, if the demand for a specific currency is high, the value of such currency will most likely increase. But if the demand of a particular currency falls, its value in the foreign exchange market falls too.

Most major global currencies often have flexible exchange rates. These include the British pounds, Mexican pesos, European euros, Japanese yen, Canadian dollars, and others.

The government of these countries and their central banks do not interfere to keep their exchange rates fixed. Though their policies can affect rates in the long run, for most of these nations their governments can only impact and not regulate exchange rates.

Fixed exchange rates

Countries that use fixed or pegged foreign exchange rates do so via their central bank. These countries set their rate against another major world currency like the United States dollar, euro or yen.

To regulate and maintain the fixed exchange rate, the government of these countries buy and sell their own currency against the foreign currency to which it is pegged. Only the governments of these countries can determine when their foreign exchange rates should change.

Countries that use the fixed exchange rate method include Saudi Arabia and China. These countries ensure that their central banks have sufficient amounts of money in their foreign currency reserves to determine the amount their currency is worth in the foreign exchange market.

Okay, but what causes the rates to change?

Rates change when currency values change. There are several key factors that affect the movement and values of local and foreign currencies. These include three key factors known as:

  1. Interest rates

  2. Money supply

  3. Financial stability

Due to these factors, the demand for a particular country’s currency, depends on what is happening in that country.

Interest rates

The interest rates a country’s central bank is setting is a key factor that will influence the country’s exchange rate. Higher interest rates have positive impacts on the value of the country’s currency. Investors are more likely to exchange their currency for one with higher interest rates, and then save it in that country’s bank to benefit from the higher interest rate.

Money supply

The money supply made available by a country’s central bank can influence the value of the currency in the foreign exchange market. For example, if there is too much money in circulation, there will be too much of it in exchange for very few goods.

Currency holders will most likely bid up the costs of goods and services which will trigger inflation. In the event that too much money is printed and in circulation in a particular country, it triggers hyperinflation and drives down their currency value in the foreign exchange market. Cash holders prefer to invest in countries with little or no inflation.

Financial stability

The financial stability and economic growth of a country can affect its foreign exchange rates. Investors are more likely to buy goods and services from countries with a strong and growing economy. This means they will need more of such a country’s currency to buy from them. this will increase the demand for such currency and ultimately boosts its value in the foreign exchange market.

If the economy of the country is in a bad shape, investors are less likely to trade with them. Investors are only interested in trading with countries that can provide gains from holding government bonds in that currency.

Are you curious to know more about XE?
Maurits Houthoff, senior business development manager at XE.com, is always in for a cup of coffee, mail or call to provide you detailed information.

 

 

Visit XE.com

Visit XE partner page