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Nicky Burridge

When planning a trip abroad, it is easy to leave your foreign currency purchases to the last minute.
And while it might be tempting to just go to your bank or change money at the airport, there are significant savings to be made by shopping around.
We compared the rates offered on four major currencies by eight providers, ranging from banks to independent money changers, to see which offered the best deal.
There are two factors that need to be considered when shopping around for foreign currency: the exchange rate being offered and whether you will be charged a fee.
A market-leading exchange rate can quickly be eroded if you are charged a flat fee of HK$100 for every transaction, particularly if you are changing small amounts.
The major banks typically charge HK$50, with some, such as HSBC and Bank of China, levying HK$100.
HSBC will change HK$5,000 into US$640. But the sum falls to US$627 once the charge is factored in.
But most banks will waive this fee if customers have an account with them, while some, including HSBC, go further and offer preferential rates to certain customers, such as those with Premier accounts.
As a result, it is a good idea to check any deals that are available from your own bank before you shop around.
Many independent money changers boast that they do not charge any commission at all.
But be warned, a foreign exchange bureau that does not levy an upfront fee is likely to be offsetting this lost revenue through a lower exchange rate.
For example, foreign exchange specialist Travelex does not charge a commission, but it offered the lowest conversion rates across the board on US dollars, euros, Japanese yen and yuan.
People wanting to change large sums of money should also ask about special deals. Travelex is running a promotion under which it offers better rates to people converting more than HK$4,999, while Bank of East Asia has different rates for those exchanging more than HK$150,000.
But consumers in this situation should also be aware that many banks place a limit on the amount of foreign currency that non-customers may buy in a day, with Bank of East Asia capping this at HK$8,000 and Industrial and Commercial Bank of China setting its limit at US$1,000 a day.
As well as checking the rates offered by the banks, it is also worth looking at specialist independent dealers. These tend to be clustered together in certain tourist-heavy areas. For example, there are about a dozen in Cleverly Street in Sheung Wan.
Independent money changer Shing Kee Money Exchange Company, which has an office in Sheung Wan, offered the best deals on US dollars, Japanese yen and yuan once all charges were factored in, although it offered among the lowest rates for euros.
Wing Hang Bank had the best overall rates before the impact of its HK$50 charge was included, and once charges were factored in, it still offered the best deal out of the major banks that were checked.
The difference between the best and worst rates on offer was as much as US$22.33 for an account holder who changed HK$5,000 at Wing Hang Bank, compared with someone who changed the same sum at Travelex. This difference balloons to US$111.65 for someone changing HK$25,000, illustrating the importance of shopping around.
As many providers charge a flat fee regardless of how much money is being changed, it is also worth considering changing all of your cash in one go.  
Finally, currency conversion rates fluctuate on a daily basis, so it is worth starting to think about changing your money up to a month before you leave for your trip.
While the savings are unlikely to be big enough to make obsessively monitoring exchange rates on a daily basis worthwhile, it is worth keeping an eye on the news.
Reports that Greece may fail to meet its deficit reduction targets or that Italian borrowing costs have risen are likely to put downward pressure on the euro, meaning your Hong Kong dollar will go further.
Equally, positive data on the US gross domestic product or unemployment figures is likely to send the US dollar higher, so you may want to wait a few days to see if the exchange rate improves.



Beware of short changing