International Transfer Fees and Exchange Rate Margins

You send $1,000 and the app says "no fee". Your family receives less than you expected anyway. The missing money is in the exchange rate. This guide shows where the cost of an international transfer hides, how to work out the total in a couple of minutes, and how to compare providers fairly.

All the rates and fees in the worked examples below are made-up example numbers, chosen so the arithmetic is easy to follow. They are not real rates from any provider. We checked the official sources on this page on 29 October 2026.

RemitHome.net.au is an independent guide run by Dominet BV. We're not a bank or a money transfer business, we don't send money for anyone, and we're not registered with AUSTRAC because we don't provide remittance services. No link on this site is an affiliate link right now. If that changes, we'll say so in our affiliate disclosure, and it won't change what we write. This is general information, not financial advice. This page names no providers, and the providers in the examples are made up.

The two parts of the cost

Moneysmart, run by ASIC, says providers set their own exchange rates and charge fees, and that the total cost depends on how much you send, where to and how. In practice there are two parts.

1. Fees you can see

These are the charges a provider lists. Moneysmart says fees can be a flat amount, a percentage of the transfer, or both. Look for:

• The transfer fee charged by your bank or provider.
• A payment method fee if you pay by card instead of bank transfer or PayID.
• Fees on the other side. Moneysmart suggests checking whether the receiver pays any fees. For bank SWIFT transfers, a bank in between or the receiving bank may take a cut.

2. The exchange rate margin

The mid-market rate is the midpoint between the rates at which banks buy and sell a currency on the wholesale market. Few people sending money get that rate. A provider usually offers a lower rate and keeps the difference. That difference is the exchange rate margin.

Moneysmart lists the margin among the things to compare. It's easy to miss because it never appears as a separate line on your receipt. You only see it if you check the rate you're given against a reference.

How to work out the margin

You need two numbers: the rate the provider offers you, and a mid-market reference for the same moment.

Margin = (reference rate minus offered rate) ÷ reference rate

Worked example 1: the margin on its own

Example numbers only. Say the reference rate is 1 AUD = 45.00 PHP and a provider offers 1 AUD = 44.10 PHP.

• Difference: 45.00 minus 44.10 = 0.90 PHP per dollar.
• Margin: 0.90 ÷ 45.00 = 0.02, which is 2.0%.

On $1,000, a 2.0% margin is worth about $20, even before any fee.

Where to find a reference rate

The Reserve Bank of Australia publishes exchange rates for the Australian dollar against major currencies, updated daily. The RBA says its data shouldn't be relied on for regulatory or commercial purposes, so treat it as a yardstick, not the price you'll get. Rates move during the day, so compare prices checked at the same time.

The total cost in one number

The cleanest way to compare is to ask: of the value I paid, how much did my recipient actually get?

Total cost (%) = 1 minus (amount received ÷ (AUD paid × reference rate))

This catches the fee and the margin together, and it works whether the fee is taken from your money or added on top.

Worked example 2: three providers, one amount

Example numbers only. Providers A, B and C are made up. The reference rate is 1 AUD = 45.00 PHP. You pay $1,000 in each case, and any fee comes out of that $1,000 before conversion. At the reference rate, $1,000 is worth 45,000 PHP.

How the A row works: $1,000 minus the $5 fee leaves $995. $995 × 44.10 = 43,879.50 PHP. The shortfall is 45,000 minus 43,879.50 = 1,120.50 PHP. Divided by the reference rate of 45.00, that's about $24.90, or 2.49% of $1,000.

What it shows: the "no fee" option, B, costs the most, because its margin is 3.0%. Provider C has the highest fee and the lowest total cost.

Worked example 3: the same providers at $5,000

Example numbers only. Change the amount to $5,000, worth 225,000 PHP at the reference rate.

A flat fee matters less as the amount grows. The margin, a percentage, grows with the amount. So the cheapest option for $200 may not be the cheapest for $5,000. Run the numbers for the amount you actually send.

Worked example 4: fees on the receiving side

Example numbers only. Bank D charges a $25 fee and offers 43.20 PHP per dollar, a 4.0% margin. The receiving bank then deducts 500 PHP when the money arrives.

• $1,000 minus $25 = $975.
• $975 × 43.20 = 42,120.00 PHP.
• Minus the 500 PHP receiving fee: 41,620.00 PHP.
• Shortfall: 45,000 minus 41,620 = 3,380 PHP, about $75.11.
• Total cost: 7.51%.

Fees deducted at the other end don't show up when you pay, which is why the amount received is the number that matters.

A five-step comparison you can do today

1. Pick one amount in AUD, the amount you actually plan to send.
2. Get the amount received from your bank and two or three registered providers, for the same delivery method and payment method, at about the same time.
3. Ask about fees on the other side, especially for bank SWIFT transfers.
4. Note the reference rate at that time, for example from the RBA.
5. Work out the total cost with the formula above, or simply pick the highest amount received from a provider you've checked on AUSTRAC's register.

For transfers to Asia, Moneysmart points to SaverAsia, an independent comparison site. The World Bank's Remittance Prices Worldwide also publishes cost data for corridors from Australia. Both are snapshots, so confirm the price with the provider before you send.

Things that change the price

• Payment method. Paying by card can cost more than bank transfer or PayID.
• Delivery method. Cash pickup, bank deposit, wallet and home delivery can be priced differently even with the same provider.
• Promotions. A better rate or no fee on a first transfer may not last. Compare the rate you'll get on the second transfer too.
• Rate guarantees. Moneysmart suggests checking whether the rate is fixed until the money arrives.
• Speed. Some providers charge more for faster delivery.

If the amount received is wrong

Contact the provider first and ask for a breakdown of the rate and fees applied. If you can't resolve it, AFCA, the Australian Financial Complaints Authority, can consider complaints about its member firms. AFCA asks you to raise the complaint with the firm first, and it can't help with a firm that isn't a member. Check the AUSTRAC register and the provider's AFCA membership before you send. Our AUSTRAC guide covers both checks.

For other countries and the basics that apply to every transfer, see our guides home page.

Frequently asked questions

What is an exchange rate margin?

It's the gap between the mid-market rate and the rate a provider gives you. It's part of the price even when the provider charges no fee.

Is a transfer with no fee cheaper?

Not necessarily. In our example above, the no-fee option cost 3.00% because of its margin, while an option with a $15 fee cost 1.94%.

Where can I find the mid-market rate?

The RBA publishes daily reference rates for the Australian dollar against major currencies. The RBA says not to rely on them for commercial purposes, so use them as a yardstick and compare prices checked at the same time.

How do I compare two providers quickly?

Enter the same AUD amount with both, for the same delivery and payment method, and compare the amount the recipient gets after all fees.

Why did my recipient get less than the app showed?

Common reasons are fees deducted by the receiving bank or a bank in between, or the rate changing before the transfer was locked in. Ask the provider for a breakdown.