Many affluent expats and investors are unaware of the hidden fees that can occur with foreign currency exchanges.
With Portugal’s appeal bringing wealth and investment, it is important to make sure that you are not overpaying when making large international transfers. Hidden costs in these transactions can often erode wealth without affluent families, expats and investors being aware.
In the European Union, an estimated €12.5 billion is lost annually to hidden exchange rate mark-ups, while some estimates suggest this figure could be even higher. Even a small percentage of fees can significantly impact large sums of capital.
That's why we built our FX platform and cost calculator tool to mitigate these hidden fees, comparing ultra-competitive rates to your current broker/bank. Just by inputting a previous exchange you made, the time, amounts and currencies you exchanged, you can see how much you were charged and could save.
The True Cost of Currency Exchange
As of March 31, 2025, the interbank rate for USD to EUR was approximately 0.9245. If a business, investor, or affluent expat needed to transfer $500,000 to EUR, the interbank rate would convert this amount to €462,250.
However, the effective exchange rate would be lower when using a traditional bank or broker with a 2% mark-up. Here's an example:
- Interbank Rate: 0.9245
- Amount in EUR (Interbank): $500,000 * 0.9245 = €462,250
- Broker's Mark-Up (2%): 0.9245 * 0.98 = 0.90601
- Amount in EUR (With Mark-Up): $500,000 * 0.90601 = €453,516
This means the business, investor or affluent expat would have to pay €9,245 due to the mark-up alone. This substantial financial leakage is often overlooked in standard transaction processes.
Choosing the Right Platform for Currency Exchange
However, avoiding these unnecessary mark-ups has become possible, with Portugal Pathways and its expert FX partners offering a more cost-effective alternative.
Collaborating with FX solution partners who charge less compared to the typical 2-4% charged by banks, Portugal Pathways is helping expats, investors, and affluent families make considerable savings, especially for large-scale transactions common with investments and relocations.
"Our community is globally minded, managing assets and responsibilities across borders," explains Paul Stannard, Chairman and Founder of Portugal Pathways and the Portugal Investment Owners Club.
"They need to know precisely how much their transactions cost and how to minimise these expenses. Awareness and education about currency transfer costs are crucial for maintaining and growing their wealth."
"Portugal Pathways emphasises transparency, with our expert FX partner platform and cost calculator tool allowing clients to clearly understand the rates and fees applied to their transactions, avoiding hidden costs."
"A user-friendly online currency account is also provided, enabling efficient management and monitoring of funds, as well as competitive exchange rates, ensuring clients receive better value for their transactions.”
“Clients can also lock in exchange rates with forward contracts to protect against market volatility, while secure and reliable payment solutions are ensured to safeguard clients' financial transfers.”
“By working with Portugal Pathways and our partners, our community avoids unnecessary costs for their FX exchanges so they can focus on what truly matters: their family's future in Portugal and investment goals.
Current NHR Tax Holders: Are you structured and protected?
Mitigate high taxes and safegaurd your finances by planning early for the end of your NHR status!
Maximise your wealth, tax status, property & life in Portugal
Talk to our expert team, so that we can offer personalised support to meet your specific needs.
