I was abroad for a few days last week. I was lucky enough to be in beautiful Germany for a while. To put a slightly sour note on the trip, I had to contend with a ridiculous layover in Heathrow on the way back to Ireland. I had over 5 hours to kill! Even though there's plenty of shops to browse around, and nice restaurants to grab a bite in, that's a lot of time to spend in an airport, especially when the flight home from there is so short. So...I needed to find something constructive to do...

While sitting in the waiting area in the terminal building (T2), I noticed there were multiple places to exchange foreign currency. There was at least one foreign exchange company operating upstairs, and another 2 downstairs. Each had a shopfront as well as ATM's. Also, there were those new ATMs, the ones at which you can choose the currency you want to withdraw. Cool idea!

I decided to take a wander around the airport and do a little comparison test on what the exchange rates were in the various places. As I walked around I took photos of the exchange rate boards in the airport. I then grabbed a coffee, and sat down to compare those rates against what was being quoted at the time on the internet. Here are the results:

foreign currency exchange
Foreign Currency Exchange Rates (May 9, 2015)

Initial impression: Pretty damning for some. Easy decision looking at others.

These are some things you should know about the above results:

  • The people I spoke to at MoneyCorp and Travelex in Heathrow airport both indicated that for transactions under £300, there was no fee, but for transactions over that amount there was a £3 fee (when transacting with a person). Their ATMs had no extra fee, only the exchange rate, but according to the reps this could vary slightly from what was shown on their foreign exchange board.
  • To transfer money with XE.com you need to sign up for an account, after which you supposedly have access to free transfers to 35+ countries. I don't have an account, and I don't know if Ireland is one of those countries.
  • CurrencyFair is a service which allows people to get cheap access to foreign currency. They basically act as a middleman between 2 people looking to swap currency. The best rate is given, and a small transaction fee is deducted, which allows everyone to get the best deal.

What are your other options?
Traditionally people use their local bank to exchange foreign currency. You can either exchange it before you leave, or go to a bank or credit union in Ireland upon arrival. Your options include exchanging cash for cash, and wire transfers. When I have exchanged money in the past in this way, I always reference XE.com for what the current rate is (or what I want it to be), but in reality I never get anywhere close to what they are showing. On top of that I usually incur a transaction fee of approx 15-25 Euro. On each end of the transfer.

Lessons learned

  • Never wait until you get to an airport to change your money! This is probably the easiest way to lose out when exchanging foreign currency. Those services are fine for emergencies, or much-needed cash, but I wouldn't use them for any other reason.
  • Bank transfers are safe and reliable, but will cost you a hefty exchange fee, and you won't receive the best rate.
  • When exchanging large chunks of foreign currency, online currency exchange services are worth exploring to save nice wads of cash!

Full disclosure
For any currency transactions made as a result of clicking through to CurrencyFair using the above links, I may receive a commission from CurrencyFair. This, of course, will be at no additional cost to you. However if you'd prefer that I don't receive any commission feel free to type CurrencyFair.com into your web browser and explore their site that way. Either way, you should definitely consider their services when you're ready to make your transaction.

Chime in
If there's a better, cheaper way to exchange foreign currency when moving internationally, please add a comment below. I'd love to hear about it.