Bank of America converts currency, but charges you for it

Yes, Bank of America converts currency. When you exchange dollars for another currency—or another currency for dollars—through Bank of America, the bank handles the conversion and charges you a fee for doing it. The conversion happens at a rate the bank sets, not the mid-market rate you see on financial news sites. That difference between the rate Bank of America uses and the actual market rate is how the bank makes money on the transaction.

The conversion can happen in several ways: you can walk into a branch and exchange cash, you can order foreign currency before traveling, you can use an ATM abroad and have the withdrawal converted automatically, or you can convert money in your account online. Each method has different costs and timing.

Key Takeaways

  • Bank of America's exchange rate includes a markup over the mid-market rate, typically 1 to 2 percent depending on the currency and method.
  • Ordering foreign currency in advance at a branch costs less than exchanging cash on the spot, because the bank has time to source the bills.
  • Using a Bank of America ATM abroad converts your withdrawal automatically and charges a foreign transaction fee on top of the currency markup.
  • Online currency conversion through your Bank of America account shows you the exact rate and fee before you confirm the transaction.

Exchange rates and markups at Bank of America branches

When you exchange cash or order foreign currency at a Bank of America branch, the bank quotes you a rate that includes its markup. The markup varies by currency and by how much you are exchanging. Major currencies like euros, British pounds, and Canadian dollars typically have smaller markups than less common currencies. The bank does not publish a single rate; each branch can quote slightly different rates depending on their inventory and demand.

If you order currency in advance—say, you call ahead and ask for 500 euros to be ready when you arrive—the bank usually charges less than if you walk in and ask for the same amount on the spot. Advance orders give the bank time to source the bills from its suppliers at better rates, and it passes some of that savings to you. The trade-off is that you have to wait, usually one to three business days, and you have to commit to the purchase.

Walk-in exchanges at the branch happen faster but cost more. You pay the higher markup because the bank is converting its own inventory when ready. Some branches keep common currencies in stock; others have to order them, which delays the transaction.

Foreign transaction fees when you use ATMs abroad

When you use a Bank of America ATM outside the United States, the bank charges a foreign transaction fee on top of the currency conversion markup. As of now, that fee is typically $3 per transaction for ATM withdrawals at non-Bank of America machines. The withdrawal amount is converted from the local currency to dollars at Bank of America's rate, and then the $3 fee is deducted from your account.

If you use an ATM that is not part of the Bank of America network, you may also pay a fee charged by the ATM operator or the bank that owns the ATM. That fee is separate from Bank of America's fee and can range from $1 to $5 depending on the country and the machine. You will see both fees itemized on your statement.

Bank of America has partnerships with some international banks and ATM networks, which can waive or reduce the foreign transaction fee in certain countries. Check the Bank of America website or call before you travel to see whether your destination is covered.

Currency conversion through online banking

You can convert currency within your Bank of America account using online banking if you hold multiple currency accounts or if you want to convert dollars to a foreign currency before traveling. The process is straightforward: you log in, select the amount and currencies, and the bank shows you the exact rate and fee before you confirm. The conversion is when ready, and the money moves between your accounts the same day.

This method is useful if you want to lock in a rate before you travel or if you are moving money to a family member in another country. The rate you see online includes Bank of America's markup, just as it does at the branch. You cannot negotiate the rate or avoid the markup, but you can see exactly what you are paying before you commit.

Debit card purchases in foreign currency

When you use your Bank of America debit card to make a purchase in a foreign currency, the merchant's bank converts the amount to dollars and sends it to Bank of America for settlement. Bank of America charges a foreign transaction fee—typically 1 percent of the purchase amount—on top of the currency conversion markup. The conversion rate used is set by Visa or Mastercard (depending on which network your card uses), not by Bank of America, but Bank of America adds its own percentage on top.

This means a $100 purchase in euros might cost you $101 or $102 in dollars by the time the transaction settles, depending on the exchange rate at the time of conversion and the fees involved. The exact amount appears on your statement a few days after the purchase, once the merchant's bank and Bank of America have settled the transaction.

How Bank of America's rates compare to other options

Bank of America's exchange rates and fees are higher than what you would get from a currency exchange specialist or from using a no-fee checking account at an online bank. Specialty currency exchange companies like XE or OFX often offer rates closer to mid-market and charge a flat fee instead of a percentage markup. Some online banks waive foreign transaction fees entirely for debit card purchases, though they still explore a conversion markup.

For small amounts—under $500—the difference between Bank of America and a competitor might be $5 to $15. For larger amounts, the difference grows. If you travel frequently or send money abroad regularly, comparing rates before each transaction can save you money over time. For a one-time trip, the convenience of using your existing Bank of America account may outweigh the cost difference.

What happens if you need currency on a weekend or holiday

Bank of America branches are closed on weekends and holidays, so you cannot order or exchange currency during those times. If you need cash before a trip and the branch is closed, you have limited options. You can use an ATM abroad once you arrive, though that charges the foreign transaction fee. You can order currency online through some banks and pick it up at a branch when they reopen, but this requires planning ahead.

Some Bank of America branches in major cities or airports stay open longer hours or on weekends, so if you are near one of those locations, you may be able to exchange currency outside normal business hours. Call ahead to confirm the branch's hours before you go.

Frequently Asked Questions

What is the difference between Bank of America's exchange rate and the mid-market rate?

The mid-market rate is the rate banks use to trade currencies with each other; it is the "true" rate you see on financial websites. Bank of America's rate includes a markup of 1 to 2 percent, depending on the currency and method. That markup is how the bank profits from the conversion. You always pay more than mid-market when you convert through a bank.

Can I lock in an exchange rate before my trip?

Bank of America does not offer forward contracts or rate locks for personal customers. When you order currency in advance, you pay the rate that is current on the day you place the order, not the day you pick it up. If the rate moves in your favor before you pick up the currency, you do not benefit from that movement.

Do I pay the foreign transaction fee if I use a Bank of America ATM abroad?

No. Bank of America waives its foreign transaction fee when you use a Bank of America ATM, even if the ATM is located outside the United States. You still pay the currency conversion markup, but not the additional $3 foreign transaction fee. However, the ATM operator may charge their own fee.

Is it cheaper to exchange currency before I travel or after I arrive?

It depends on the amount and the currency. Exchanging before you travel at a Bank of America branch (with advance notice) is usually cheaper than exchanging on the spot. Using an ATM abroad is cheaper than exchanging cash at a currency exchange booth in an airport, but more expensive than ordering currency in advance. For most trips, ordering a few days ahead costs the least.

What currencies can Bank of America convert?

Bank of America handles major currencies like euros, British pounds, Canadian dollars, Japanese yen, and Australian dollars regularly. Less common currencies may require special order and take longer. Call your local branch or check the Bank of America website to see whether they stock the currency you need.