Remittance Fees vs Exchange Rate: Where the Hidden Cost Is
Two ways you pay for a transfer
When you send money abroad you usually pay in two ways. The first is the visible one: a service fee, either fixed or a percentage. The second is less visible: the exchange-rate margin, which is the gap between the market rate and the rate you are given. A provider advertising "no fee" may still earn money through the margin.
How to see the margin
Look up the current market rate for the dollar against your family's currency, and remember that one US dollar equals 3.75 Saudi riyals. Divide the market rate by 3.75 to get an approximate market rate per riyal. The difference between that figure and the rate your app offers is the margin. The larger the gap, the more the provider keeps.
For example, if the market rate works out to 23.00 per riyal and an app offers 22.70, that app keeps about 0.30 per riyal, which is 300 units on a 1,000 SAR transfer. The numbers here are for illustration only.
Compare the final amount, not the headline
The cleanest comparison is always the final amount received for the same amount sent: (amount sent minus fee) multiplied by the rate. The calculator on each RiyalRate.com country page shows how much each provider would give for the amount you type in, before any fee, so you can subtract the fee yourself.
Other costs to watch for
- A separate charge by the receiving bank or wallet.
- A higher fee for small transfers or for certain payout methods.
- A promotional rate that applies only to your first transfer.
- Currency conversion done by the recipient's bank on top of your transfer.
Ask your provider or check its fee table in the app so there are no surprises.
See today's rates: India · Pakistan · Bangladesh · Nepal · Sri Lanka · Philippines. Rates are user-reported and for reference only; always confirm the final rate with your provider.