Although local money changers are stationed in tourist spots and hubs, having cash on hand is still the best option to avoid the hassle of dealing with money changers.
There are a number of reputable companies that will allow you to purchase foreign currency online. If you are traveling to Europe, you can purchase foreign currency with Rail Europe (http://www.railEurope.com). Rail Europe caters to North American travelers who want to tour Europe by train. Since the continent works with Euro and other national currencies, dealing with Rail Europe will get you the right currency in your destination. You can place your orders for foreign currency purchase online, and then pick them up when you are ready to travel. With Rail Europe, you can use credit cards to purchase foreign currency online.
Another key service that will allow you to purchase foreign currency online is Travelex. With operations in 19 key countries including from the United States and Japan, business travelers can purchase foreign currency before they arrive in their destination. The greatest demands for these services come from travelers. Thus, the infrastructure for these services is designed for their convenience. Coordinate with your travel agency, so they can help you find companies that sell foreign currency at a discount.
The Purpose Of Purchasing Foreign Currency
People purchase foreign currency for a number of reasons, but tourists have the most pressing need for these currencies. During their stay abroad, they encounter unexpected expenses or buy local goods where the sellers only accept local currency. This is especially true in local transport. If you want to go from one place to another, you need to ride transport that only accepts their local currency. Rarely do taxis accept credit cards or traveler’s checks. Having foreign currency on hand will remove the hassle of finding a seller that accepts your currency, although some cosmopolitan cities accept major currencies like the Euro and the dollar.
In this global economy, the need to travel is increasing and aside from the Euro, there are no truly international currencies. To move around a country, you need to have a stock of foreign currency. Businesses also need to purchase foreign currency for their petty cash flow and expense accounts.
People also purchase foreign currency, so they can participate in forex trading. Forex trading is the act of leveraging currency values to make a profit. Many forex traders purchase foreign currency online, but they rarely exchange it for immediate consumption since it is reinvested to the market.
What You Need To Purchase Foreign Currency
There are different international laws governing the purchase of foreign currency. However, banks and money services make it easy for the average Joe to find a currency exchange anywhere. To complete the transaction, you must bring a valid I.D., so the service can verify your identity. Trading foreign currency outside of banks is regulated. Sometimes, you have to show more than two I.D.s and other supporting documents. Purchasing a large amount of foreign currency may draw attention from the government, and you may have to write a formal letter to allow you to trade large values. If you are a tourist, your passport is the best identification that you can present.
There are different rules in purchasing foreign currency among different countries. That is why it is best to secure foreign currency at home through online services or banks. Foreign currency transaction is easier to accomplish in the U.S. and Western Europe, compared to countries in Asia and Eastern Europe.
Other Things To Consider In Purchasing Foreign Currency
If you want to purchase large amounts of foreign currency, you have to consider exchange rate fluctuations. A subtle movement in the exchange rate can lose you money. Online currency changers sell foreign currency at a higher price than the prevailing bank rate. In addition, sellers charge you with the cost of transaction and money transfer, which can easily lose you a significant value of your purchase.
If you are sending money abroad via services like PayPal or Western Union, you must look out for their respective transfer fees and exchange rates. They follow a formula in their exchange rates to ensure that they do not lose money when you convert your currency. In fact, money transfer services earn some of their profit by charging a higher exchange rate.
Purchasing foreign currency online is a great way to get the most currency value. Shop around for the lowest rates and consider other costs before making the purchase. Always have an ATM or a traveler’s check available when you travel to supplement your cash.