It's not easy to find the best euro exchange rate.
I searched all over the internet and found everyone had a different answer.
I'm sure it's confusing for customers to get to the bottom of it.
In my experience, most people just want to know:
- Who has the best rates?
- Can they be trusted?
- Are there any hidden fees or charges?
Below is my insider's guide on how to get a better GBP/EUR exchange rate, the hidden costs to look out for, and the places to avoid.
Travel money or money transfer?
To get the best exchange rate depends on whether you need travel money (cash) or a money transfer (bank-to-bank).
They are separate markets with different providers.
Here's a quick summary of my findings:
Debenhams, Asda, Sainsbury's
Travel Money: best euro exchange rates
Most people know to avoid airports for travel money.
Yes - they're convenient - but the rates are generally terrible.
Ignore the flashing signs saying “pay no commission” or “0% commission”.
It's just a marketing ploy.
The money is made from the exchange rate.
At airports, the profit margin built into the exchange rate can be as high as 15%-30%.
That means if you exchange £300 into Euros, you could be losing £45 to £90 in exchange rate costs.
The best way around this is to order your Euros before you get to the airport.
Our research found that Debenhams, Asda and Sainsbury's consistently offer some of the best euro exchange rates for travel money.
The Post Office tends to charge a bit more than the names above.
You can find some smaller independents that will beat the big names, but the gains were pretty small.
On £300 holiday money, I found the difference between the top 5 providers was only about £3 in cost.
That's why I suggest sticking to the three familiar and reputable companies I mentioned above.
Money Transfers: best euro exchange rates
As money transfers tend to be larger amounts than travel money, the stakes are higher.
The upside is the savings can be higher too.
If you are looking to transfer pounds into euros, you can use either a bank or currency broker.
While your bank might seem like an obvious choice, the costs can be substantially more.
As a general rule, banks can charge up to 4%-5% to send money abroad. Currency brokers can be a cheaper and better alternative to the banks.
It depends on the amount of British Pounds you need to exchange.
The big UK banks set their exchange rates based on the size of your money transfer.
The more you send, the better the rate.
For a customer, I appreciate it's not easy to ascertain what the exact costs are because the profit margin is embedded in the exchange rate.
Another thing to note is that the banks also charge transfer fees - adding another layer of cost.
I'm all for keeping things simple.
There's no need to build a spreadsheet or reach for a calculator.
When making a comparison, just focus on the amount of Euros you will receive for your British Pounds.
The bigger the number, the better.
If you are thinking of using your bank, I would suggest getting a quote elsewhere and finding out what you could save.
What's the harm in that? It's the power of the consumer.
If you would like to compare our rates to your bank or existing provider, please request a quote below.
5 reasons you shouldn't use your bank...
- It's not their area of expertise
- Their exchange rates are uncompetitive
- Banks charge transfer fees
- They won't help you with timing
- You are not their priority
Are currency brokers regulated?
I appreciate that safety and security is a priority for anyone.
So before you select a currency provider, it's important to know that not all companies are regulated.
My suggestion is you choose a company that is Authorised by the FCA (Financial Conduct Authority) - the UK's financial regulator.
An FCA Authorised currency broker is required to transfer all customers funds using a separate, safeguarded client account.
It means your money will pass through a bank account used solely to carry out money transfers and not be mixed with any of the company's money.
You can check if a company is Authorised by typing its name into the Financial Services Register.
Beware of ‘fake’ euro rates
If you have been searching online for the best euro exchange rate, you will likely have come across a bunch of websites offering live exchange rates.
Some of the more popular ones are XE, Oanda and DailyFX.
Even Google automatically displays a rate now.
But here's the thing not many people know...
The exchange rates you see online are not real rates that can be achieved by a customer.
What you are seeing is something called interbank exchange rates.
As the name suggests, interbank rates are used by the banks to trade with each other.
They are not customer rates.
If you look closely at these sites, you will find a disclaimer somewhere saying something like “not available to consumers” or "for informational purposes only.”
Annoying to say the least.
Even large corporations, who trade tens of millions in foreign exchange, don’t trade at interbank rates.
It's not very helpful for customers because they are using a false rate to calculate what their money is worth.
If you are buying a property abroad or making a large transaction, it could really mess up your budget or life plans.
Why you should be wary of comparison sites
Comparison websites are everywhere these days.
A lot of people use them to scan a market quickly and compare prices.
But when it comes to getting the best euro exchange rates, I think they are fundamentally flawed and should be regulated.
They claim to "compare the market", but that is simply not the case.
The market they refer to is their own market.
Despite the funny ads, they are money-making machines.
How do comparison sites make money? By selling what is best for them – not you.
In reality, they add another layer of cost - even if it is paid by the provider and indirectly passed on to the customer.
An alternative is to go direct to the source - whether that be us, another provider or a bank.
At least that way you are cutting out the middleman.
How to achieve the best rate
If you’ve ever watched live exchange rates before, you will have noticed they are constantly moving around.
They change every 2-3 seconds.
If you look at a GBP/EUR chart, you can see how much the rate can move in both the short and long term.
Getting the best pound to euro rate can depend on selecting the optimal time to exchange your money.
For large money transfers, even small fractional moves in the rate can have a big impact on what your pounds are worth.
On a money transfer of say £75,000, a move of just 0.5% up or down in the euro exchange rate works out at £375 difference.
A move of just 0.5% is often a daily event - sometimes within a few hours.
Over the course of several weeks, the GBP/EUR rate can move 3%, 4% or even 5%.
You can see how timing can make a world of difference.
While no one has a crystal ball, getting some guidance on current market trends from a currency broker can help you achieve a better euro exchange rate.
A currency broker can monitor the rate for you and let you know when it moves in your favour.
Most people also have a window of time in which they can get their money transfer done.
It could be a few days, weeks or even months.
However, as most customers have neither the time nor inclination to watch exchange rates all day, they can easily miss opportunities that may arise.
As part of our service, we can work with you to optimise your position and reduce your costs.
You should be aware this is not a standard feature of banks or other currency brokers.
Why online-only brokers can prove costly
There are an increasing number of online-only brokers in the money transfer industry.
Some of the better known "do-it-yourself" operators are Paypal, Transferwise, CurrencyFair and Revolut.
They are popular with people sending money to relatives and with online merchants, who need to process lots of small, regular payments, but they have their limitations.
The customer support is through email or webchat, and they offer no guidance on exchange rates.
If you want to go ahead, you have to accept whatever rate they give you on the day.
There is no one to help you decide if it's a good or bad time to exchange your money. Yet adverse currency fluctuations can prove extremely costly to someone unfamiliar with current market trends.
I also don't like the way they make you enter all the payment details.
Most people aren't used to inputting IBANs and SWIFT codes - which can easily lead to errors.
I know when I was looking to transfer a large sum of money overseas, I was worried I might input something wrong or mess up the timing of my transfer.
There was no way I was going to do everything myself.
For larger money transfers, many customers want the peace of mind of having a real person they can speak to.
Choosing a currency broker that offers some personal assistance goes a long way to taking the stress and worry out of a money transfer.
Ultimately, it depends on what your prefer.
You are no longer beholden to banks for foreign exchange and money transfers.
Anyone looking for the best euro rate in the UK has alternatives available that could save you considerable money.
Who are we?
I am a Director of Key Currency - a leading currency broker.
We help our customers achieve better euro exchange rates.
- The cost of our service is included within the exchange rate we quote.
- No fees or charges are added.
- We offer tight margins on exchange rates.
As an independent currency broker, we have far lower overheads than the banks.
This enables us to pass on the savings to our customers.
As part of our service, you get the added benefit of having a real person to assist you with your transfer.
In my experience, a lot of people don't want to do everything online or download an app.
A lot of currency brokers are forcing their customers online and making them do all the work.
That's not the way we operate.
At Key Currency, we work with you to improve your rate.
We will discuss and agree on the right time to exchange your money, rather than using a bank or online system and having to accept whatever rate they give you on the day. Bad timing can be as costly as a bad exchange rate.
As a company, we are open and transparent.
That's why we show the names and faces of our people on our website.
Rest assured - we are also Authorised and Regulated by the FCA (No. 753989). As such, you have the peace of mind knowing that all money transfers are conducted through safeguarded client accounts.
We have attained a 5-star "excellent" rating on the review website Trustpilot, based on hundreds of customer reviews.
To find out our latest euro rates, simply request a free quote below.