Understand how much you could save with competitive FX rates vs typical bank margins.
Mid-market rates auto-updated at least daily · last updated 05 Sep 2026
When you exchange currency, the provider adds a margin (markup) to the mid-market exchange rate. This margin represents their profit on the transaction. While margins are standard practice, they vary significantly between providers.
Mid-market rate: The real exchange rate you see on financial news sites—the midpoint between buying and selling prices in global currency markets. No provider can offer this exact rate, but competitive providers get much closer to it than traditional banks.
The FX margin is the percentage difference between the mid-market rate and the rate you are actually offered:
FX margin (%) = (mid-market rate − offered rate) ÷ mid-market rate × 100
Example: the GBP→EUR mid-market rate is 1.1700 and your bank offers 1.1290. The margin is (1.1700 − 1.1290) ÷ 1.1700 × 100 = 3.5%. On a £100,000 transfer, that margin costs £3,500 before any fixed transfer fees.
Typical FX margin ranges by provider type (indicative industry ranges, not quotes):
| Provider type | Typical FX margin | Cost per £100k |
|---|---|---|
| High street bank (walk-in / online SME) | 3–5% | £3,000–£5,000 |
| Consumer FX app / card | 1–2.5% | £1,000–£2,500 |
| Specialist business payment provider | 0.7–1.5% | £700–£1,500 |
| Negotiated volume pricing (high volume) | 0.1–0.7% | £100–£700 |
To check your own margin: note the rate you were offered, look up the live mid-market rate for the same currency pair at the same time (financial news sites publish it), and apply the formula above — or use the calculator on this page to compare typical margin scenarios side by side.
Traditional high street banks typically charge FX margins between 3-5% (sometimes higher) for several reasons:
Specialist payment providers and modern banking infrastructure partners typically offer margins of 0.7-1.5%:
The difference between a 4% margin and a 0.7% margin may seem small, but it compounds significantly:
| Annual FX Volume | Cost at 4% Margin | Cost at 0.7% Margin | Annual Savings |
|---|---|---|---|
| £100,000 | £4,000 | £700 | £3,300 |
| £500,000 | £20,000 | £3,500 | £16,500 |
| £1,000,000 | £40,000 | £7,000 | £33,000 |
| £5,000,000 | £200,000 | £35,000 | £165,000 |
For businesses with regular international transactions, these savings go straight to the bottom line. Over a 5-year period, a company processing £1M annually in FX could save £165,000 or more.
Many businesses focus only on the exchange rate but overlook additional costs:
Modern payment infrastructure minimizes or eliminates many of these additional costs through direct routing, local payment rails, and multi-currency account structures.
Consider evaluating alternative FX providers if you:
When comparing FX providers, request clear answers to these questions:
Get live rates tailored to your transaction volumes and currency pairs.
The mid-market rate is refreshed automatically at least once a day from live market data, so it closely tracks the real market rather than a fixed example — but it is not tick-by-tick real-time. The "bank" and "competitive" rates are illustrative margin examples, not actual quotes. For a live, transaction-specific rate, please contact us directly or create an account to access live pricing.
Actual rates depend on multiple factors including current market conditions, transaction size, currency pair, and timing. The competitive rates shown represent typical margins for business customers, but your specific rate may be better or different based on your circumstances. We can provide accurate quotes for your specific needs.
The calculator applies a 3.5% margin to approximate typical high street bank rates. However, bank margins vary (often between 3-5%, sometimes higher) based on customer relationship, transaction size, and currency pair. This is a general estimate for comparison purposes.
Key factors include: transaction size (larger volumes typically get better rates), currency pair (major pairs like GBP/EUR/USD usually have tighter margins), payment frequency (regular customers may negotiate better terms), market volatility, and the specific provider's pricing model.
This calculator shows only the FX margin comparison. Additional fees may include transfer fees, intermediary bank charges, and receiving bank fees. These vary by provider and payment method. When comparing total costs, always ask for a complete breakdown including all fees.
Create a free account to access live rates, or contact our team with details of your currency pairs, typical transaction sizes, and frequency. We'll provide accurate, current pricing tailored to your business needs.
Other tools that pair with this one: the payment cost calculator for the all-in cost of a transfer, the payment timing calculator for arrival dates, the IBAN checker for beneficiary details, and the HMRC monthly rates for tax filings. For background, see the multi-currency account guide and the cross-border payments guide.