Money Matters: A Snapshot Comparison of Currency Exchange Rates

A couple of readers have recently pointed out that the exchange rate of Air New Zealand's OneSmart card is not as good as it used to be. I decided to take a look at how it compares with banks and other travel card options these days. [Added 8 May 2013: I also just noticed yesterday that the OneSmart fees schedule is changing  from 21 May, so have added a column showing the changes in the last table.] [Added 22 May 2013: And vented my displeasure at the lack of communication about the changes.]

Exchange Rates: an Unfair Comparison

In the table below, I have taken the exchange rates from the various websites at around noon on Thursday. I have left out rates for international money transfer, as that requires you to have a bank account in another country. I have also not considered Western Union rates, as their pre-paid cards do not appear to be available in New Zealand, and apart from being the favoured form of payment by scammers, I assume you would also need to have a foreign bank account, or go out of your way to visit an agent at your destination country.

I have highlighted the best exchange rate for each currency in green below.  These are rates for buying foreign currency with your NZD at the major organisations, and do not take into account any commissions or withdrawal fees which may be charged.

	One Smart	ANZ	ASB	BNZ	Kiwibank		Travelex		TSB
	25 April, ~12:05p.m.	25 April, 11:59am	25 April, 12:06p.m.	24 April, 16:42pm	25 April,  12:03pm		24 Apr,  11:30am		24 Apr, time not stated
	One Smart	Cash	Cash	Cash	Cash	Loaded™ for Travel	Cash (Online)	Cash Passport	Cash	Cash Passport
AUD Australian Dollars	0.7959	0.8128	0.8109	0.8139	0.8076	0.8162	0.806	0.806	0.8112	0.7962
GBP Great Britain Pounds	0.5353	0.5458	0.5446	0.5454	0.5424	0.5465	0.5366	0.5366	0.5445	0.5305
USD United States Dollars	0.8177	0.8344	0.8309	0.8325	0.8294	0.8364	0.8253	0.8253	0.8322	0.8208
JPY Japanese Yen	81.3450	82.84	82.2535	82.37	82.0470	82.6479	81.1824	81.1824	82.6786	79.6696
EUR Euros	0.6282	0.6395	0.6367	0.6378	0.6352	0.6398	0.628	0.628	0.6364	0.6226
CAD Canadian Dollars	0.8383	0.8579	0.8541		0.8485	0.8534	0.8347	0.8347	0.8547	0.8285
AED United Arab Emirates Dirham				2.9552			2.7969		2.5459
ARS Argentine Pesos							3.8538
BRL Brazilian Real							1.5452
CHF Swiss Francs		0.7921	0.7833	0.783	0.7786				0.7847
CNY Chinese Yuan				4.8805	4.7814		4.7659		4.6691
DKK Danish Krone		4.7104	4.7282	4.7547	4.7367				4.7462
EGP Egyptian Pounds					5.1345				5.0377
FJD Fijian Dollars		1.4598	1.4534	1.4419	1.4490		1.4237		1.4772
HKD Hong Kong Dollars	6.3486	6.4950	6.4419	6.4433	6.3660	6.4051	6.2393	6.2393	6.4794	6.2324
IDR Indonesian Rupiah					7664 .0373		7153 .8364		7393 .4198
INR Indian Rupee			44.3985		41.1603	40.8478	42.4691		43.6899
KRW Korea (South) Won				901 .57	841 .0558		865 .1645		819 .1501
MYR Malaysian Ringgit				2.4008	2.3915		2.3831		2.349
NOK Norwegian Krone			4.8963	4.9071	4.8864				4.9068
PGK Papua New Guinea Kina			1.6970				1.5628		1.5783
PHP Philippines Pesos			33.801		32.8944		31.5497		34.0472
SEK Swedish Krona		5.4399	5.4798	5.5111	5.4419				5.4723
SGD Singapore Dollars	1.0157	1.0387	1.0269	1.0292	1.0223	1.0314	1.0052	1.0052	1.0351	0.9965
THB Thailand Baht		23.7798	23.3873	23.50	23.1032	23.3298	22.2673		23.7778
TOP Tongan Pa’anga			1.3449	1.3457	1.3265		1.2683	1.2796
TRY Turkish Lira					1.3627				1.3119
TWD Taiwanese New Dollars					22.2885				24.2543
VND Viet Nam Dong					15631 .8624				13956 .5145
VUV Vanuatu Vatu					73.5993		70.0811		71.5479
WST Samoan Tala		1.8135	1.7792	1.659	1.7601		1.6578		1.6851
XPF French Polynesian Francs		74.97	74.9845	75.00			71.0793		73.2717
ZAR South African Rand		7.5299	7.5929	7.6517	7.4484	7.4606	7.1148		7.6647

As Thursday was a public holiday (ANZAC Day), some of these rates have not been updated since the day before. I therefore ran the numbers again yesterday morning, just before 8:30am.  The Travelex and TSB websites did not display refreshed numbers until later in the day, so to avoid using the same data as in the table above, I used rates from a later time.  It's also worth pointing out that I was not able to get all the rates at the same time for OneSmart, because I was viewing each currency manually.  By the time I had gone through the other currencies and checked HKD again, for instance, 1 NZD could be converted to 6.3685 HKD, rather than the 6.3696 HKD listed in the table below, which was from just a couple of minutes earlier.

	One Smart	ANZ	ASB	BNZ	Kiwibank		Travelex		TSB
	26 April, ~8:25am	26 April, 8:24am	26 April, 08:29am	26 April,  08:17am	26 April,  8:28am		26 Apr,  11:30am		26 Apr, time not stated
	One Smart	Cash	Cash	Cash	Cash	Loaded™ for Travel	Cash (Online)	Cash Passport	Cash	Cash Passport
AUD Australian Dollars	0.7968	0.8141	0.8145	0.817	0.8076	0.8168	0.8134	0.8134	0.816	0.8021
GBP Great Britain Pounds	0.5316	0.542	0.5423	0.5428	0.5424	0.5426	0.5363	0.5363	0.5419	0.5306
USD United States Dollars	0.8204	0.837	0.8383	0.8389	0.8294	0.8387	0.8351	0.8351	0.8393	0.829
JPY Japanese Yen	81.51	83.04	82.9395	82.97	82.047	82.8247	82.1944	82.1944	83.3479	80.5912
EUR Euros	0.6307	0.6421	0.6416	0.6422	0.6352	0.642	0.6353	0.6353	0.6413	0.6317
CAD Canadian Dollars	0.8372	0.8567	0.8565	0.8536	0.8485	0.8521	0.8401	0.8401	0.8564	0.832
AED United Arab Emirates Dirham				2.978			2.8301		2.5788
ARS Argentine Pesos							3.9007
BRL Brazilian Real							1.5475
CHF Swiss Francs		0.7926	0.789	0.7887	0.7786				0.7909
CNY Chinese Yuan				4.9119	4.7814		4.8161		4.7225
DKK Danish Krone		4.7295	4.7651	4.7885	4.7367				4.7826
EGP Egyptian Pounds					5.1345				5.099
FJD Fijian Dollars		1.4642	1.4658	1.4498	1.449		1.4373		1.48
HKD Hong Kong Dollars	6.3696	6.5152	6.4991	6.4935	6.366	6.4229	6.3137	6.3137	6.535	6.2958
IDR Indonesian Rupiah					7664 .0373		7233 .789		7479 .0676
INR Indian Rupee			44.6721		41.1603	40.7135	42.8084		44.0426
KRW Korea (South) Won				902 .09	841 .0558		869 .2693		823 .511
MYR Malaysian Ringgit				2.4028	2.3915		2.3949		2.3612
NOK Norwegian Krone			4.9	4.9086	4.8864				4.9077
PGK Papua New Guinea Kina							1.581		1.5972
PHP Philippines Pesos			34.0844		32.8944		31.8249		34.2285
SEK Swedish Krona		5.4553	5.4978	5.5236	5.4419				5.484
SGD Singapore Dollars	1.016	1.0391	1.0341	1.0347	1.0223	1.0313	1.0149	1.0149	1.0424	1.0056
THB Thailand Baht		24.0471	24.113	23.97	23.1032	23.5503	22.8464		24.3101
TOP Tongan Pa’anga			1.357	1.3561	1.3265		1.2833		1.2952
TRY Turkish Lira					1.3627				1.3278
TWD Taiwanese New Dollars					22.2885				24.5463
VND Viet Nam Dong					15631 .8624				14126 .4372
VUV Vanuatu Vatu					73.5993				72.4979
WST Samoan Tala		1.819	1.7952	1.6719	1.7601		1.677		1.705
XPF French Polynesian Francs		75.28	75.5565	75.54			71.894		74.1345
ZAR South African Rand		7.5277	7.5567	7.6146	7.4484	7.4618	7.1077		7.6671

As you can see, there isn't one outright winner.  Depending on the currency you want to purchase, and the time at which you are checking the rates, your choice could swing one way or another.  Just because a certain business offers the best rate doesn't mean it is necessarily the best option either, because it could come with high fees that outweigh the rate advantage. Or it may not be suitable because you need to wait for the currency to be ordered, when you are in a hurry to get the money.

Which Form of Payment?

Banks generally charge a 1% commission for changing foreign currency, with a minimum fee.  It's always useful to have some cash on hand before going to another country, but you may want to have another form of payment to avoid carrying large wads of cash around, and for paying for higher value and/or online purchases.  You can, of course, use a credit or debit card linked to your bank account, which is a very convenient option.  But this often comes with high fees for cash withdrawals and currency conversions, which you might be able to bypass by using a multi-currency travel card.  You may also want to use a standalone travel card in case it gets stolen, or to make sure you don't spend too much.

Form of Payment	Pros	Cons
Cash	Money is right there; no need to look for an ATM You can request smaller notes when getting your money changed, useful for smaller purchases Cash is accepted everywhere, including at roadside stalls At certain stores, you may go into an express queue if paying by cash	Need to collect cash from bank or money exchange location Cannot make online purchases, e.g. top up mobile credit from home No recourse if your money is lost or stolen, or at least it may be difficult to prove how much you had
Credit Card	Convenient; no need to plan ahead No need to set aside funds in advance; money potentially earning interest at a bank if not used Can be replaced if lost or stolen May offer rewards for purchases	High fees, particularly for cash withdrawals Cannot know exchange rate ahead of time Card may not be accepted for smaller purchases, or merchant may charge a fee for its use
Travel Card (Multi-Currency Debit Card)	Can "lock in" exchange rate Standalone card with no link to your bank account could provide peace of mind Potentially lower fees and/or better exchange rates than credit cards Can be replaced if lost or stolen May offer rewards for purchases	Requires research and planning, e.g. understand concept of wallets, must load money before using the card, take steps to avoid fees Complicated fees structure For longer trips, you will want to make sure you have internet access to manage your funds Card may not be accepted for smaller purchases, or merchant may charge a fee for its use

A Closer Look at Travel Cards

I only know of three main travel card options, which I have included in the table of fees and limits below (please check the official websites to confirm these have not changed).  Kiwibank's Loaded for Travel card appears to have the best exchange rate, but is also the only travel card to charge $6 for every ATM withdrawal, and has a higher fee for loading money onto the card, assuming you are loading more than $100. You will not be issued a new card once it expires, so you would need to pay another $12 setup fee for a new one. Air New Zealand's OneSmart card is the only one which is free to obtain and rewards purchases on the card (bonus Airpoints Dollars), but is also the only travel card which does not offer you a secondary card for the same account, free or otherwise [Added 8 May 2013: looks like this may be offered at a later date].  Travelex's Cash Passport has higher limits than the others, though that is not necessarily a good thing.

	OneSmart		Loaded For Travel	Cash Passport
Card type	Mastercard		Visa	Mastercard
Promoted by	AirNZ		NZ Post	Travelex
Issuing Bank	BNZ		Kiwibank
Fees (changes to OneSmart fees effective from 21 May 2013 highlighted in red below)
Setup fee	$0 (you can join Airpoints for free using the promo code JOINAP)		$12	Dependent on agent
Secondary card fee	N/A	$10	$0	$0
Load/Reload fee - bank transfer	$1	$0	1% of the amount loaded, up to $10	$1
Load/Reload fee - via agent	$3.95	$4	1% of the amount loaded, up to $10	The greater of 1% of the initial load / reload amount or NZ$10.00
ATM balance enquiry	$1		$1	not mentioned
ATM cash withdrawal - in NZ	$1.50	$2	$6	$2
ATM cash withdrawal - international	$0	$0 for first three withdrawals per month, thereafter NZ$3 or similar values in other currencies	$6	$0
Branch withdrawal fee - cash over the counter	N/A		$6	$10
Currency Conversion Fee - unsupported currencies	2.50% (not charged although listed in fees)	2.50% (enforced)	2.50%	5.95%
Currency Conversion Fee - insufficient funds in wallet	0.00%		0.00%	5.95%
Monthly account fee	$1.95 unless money loaded, or no money in NZD wallet	$1, even if money loaded. Fee taken from other wallet if insufficient NZD	$0	$0
Monthly Inactivity fee	$1.95, after 3 months	$0 (now covered by monthly account fee)	$1, after 12 months	$4, after 12 months
Email alerts fee	$0		$0.05	N/A
TXT alerts fee	$0.10		N/A	N/A
TXT service fee - balance enquiry	$0.10		$0.50	N/A
Card replacement fee	$12.95	$10	$10	$0
Express delivery fee	$25		$15 - $30	N/A
Paper statement fee	$9.95	$10	N/A	N/A
Disputed transaction fee	$9.95	$10	$15	not mentioned
Closure/Transfer fee	$9.95	$10	$15	$10
Limits
Max load amount	$10,000		$9,500	$25,000
Max load per day	N/A		$9,500	$25,000
Max balance across all currencies	$10,000 (online verification), $25,000 (verification in person)	$75,000 on application	$20,000	$75,000
Max withdrawal amount	$1,000		$1,000	N/A
Daily max withdrawals and purchases	N/A		$5,000	$15,000
Daily cash over the counter limit	N/A		N/A	$400
Daily max ATM withdrawal	$1,000		$2,500	$3,000

[Added 11 May 2013:

My Latest Experience with the OneSmart Card

Cash vs. OneSmart

On 29 April, I was quoted a rate of 6.5251 for changing HKD cash at TSB (this rate remains active until the next morning). Since this was much better than the rate on OneSmart (which was around 6.37), and I always like to have some cash on hand, I walked in to their Queen Street branch and changed another 6,000 HKD, even though I had already loaded money on my OneSmart card. This cost me 928.73 NZD: 6000 / 6.5251 = $919.53 in straight currency exchange, plus 1%, or $9.20 in commission.  You could say that this had an effective exchange rate of 6000 / 928.73 = 6.4604. I left my money as NZD on OneSmart, in case I chose not to spend it overseas, but on groceries at home instead.

On checking in to a hotel a day later, I was given the option of paying in cash, or by card.  The OneSmart exchange rate at the time was 6.3531, so a room costing 700 HKD would cost 700 / 6.3531 = 110.18 NZD.  Since I would earn 1% of the value spent overseas, or $1.10, in Airpoints Dollars, I calculated the effective exchange rate as 700 / (110.18 - 1.10) = 6.4173.  Not as good as the rate I had from TSB.  I chose to pay in cash, which was a good thing, as we ended up leaving the hotel early.  Getting payment back in cash is much better than having a pending transaction trapped in your OneSmart card, because you can spend the money again immediately.

The exchange rate on OneSmart did go up to 6.40xx a couple of days later, which would have yielded an effective exchange rate of something like 6.4641 for overseas purchases (but not ATM withdrawals).

At the start of my trip, I was able to have much better exchange rate from a bank than from the OneSmart card.  However, if the exchange rate was going to keep going up, using the OneSmart would have allowed me to change money at a later point in time, when the exchange rate was better (but, not having prophetic powers, it could have been even worse as well).

Credit card vs. OneSmart - purchases in-store while overseas

The thing with credit card exchange rates is that they are not published anywhere, so it is difficult to know in advance whether they are worth using, other than for the obvious convenience factor.  To compare the rate of my Visa credit card against OneSmart, I looked at transactions that were made at a similar time.

While I was in Hong Kong last week, I went clothes shopping (the shops were open till midnight or 1am!).  At one shop, I made the payment on my Visa credit card at 23:20 on 5 May.  The 998 HKD was converted with an exchange rate of 6.5831 to 151.60 NZD.  On top of this, I had to pay an Offshore Service Margin of 2.1%.  I calculated this to be 0.021 * 151.60 = $3.1836, but this was rounded up to $3.19 in my statement.  In total, this purchase cost me 151.60 + 3.19 = NZ$154.79, which I considered as having an effective exchange rate of 998 / 154.79 = 6.4474.  (I am not considering rewards in this section, as I am assuming credit cards and OneSmart both offer rewards of 1%, though this may be different depending on the type of credit card you have.)

For a smaller purchase across the road, I used my OneSmart card at 23:58, also on 5 May.  This time, a 179 HKD purchase was converted to 28.18 NZD, giving an effective exchange rate of 179 / 28.18 = 6.3520.  Even without further fees, this was worse than using the credit card.

To be sure, I checked again on another day, when I had purchases on the two cards within a couple of hours  of each other.  This time, what I call the effective exchange rate was 6.4378 and 6.3910 for Visa and OneSmart respectively.  Again, the Visa credit card had a better exchange rate, even after taking the Offshore Service Margin into account.  If you consider how much easier it is to use a credit card (no need to load money in advance) and the fact that you have a one month grace period before you have to pay that debt off, the credit card is superior these days.

Credit card vs. OneSmart - obtaining cash from ATM while overseas

So what if you have run out of cash, and need some more?  Using the same rates as above getting 1,000 HKD in cash from an ATM using a credit card would cost you 1000 / 6.4474 = 155.10 NZD using your Visa card, and you would need to pay a fee of $7.50, so a total of 155.10 + 7.50 = $162.60.  Don't forget that for cash advances, interest is payable immediately, rather than having the one month grace period that purchases offer.

In contrast, using your OneSmart, the same amount of foreign currency would cost you 1000 / 6.3520 = $157.43.  With the new fees kicking in from 21 May, you would have to pay an extra 20 HKD for the international withdrawal if this is your fourth withdrawal in the month.  In this case, it would cost you 1020 / 6.3520 = $160.58.

In either case, the OneSmart is better for overseas cash withdrawals than my Visa credit card.

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In the past, I have found the OneSmart to be an excellent solution for travelling with less cash.  However, as various people have pointed out, its exchange rates are poorer these days, and its fees are changing as of 21 May 2013.  While the OneSmart is still good for withdrawing cash overseas, for a shorter trip to a developed country, I would now rely on getting cash out from a bank in advance, then making purchases on my normal credit card, but perhaps for a longer trip to a destination where you feel less comfortable with carrying cash and where credit cards are not widely accepted, you may choose to go for a travel card solution.
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As usual, different options each have their own advantages and disadvantages.  You will need to evaluate your intended spending behaviour to find out what would work best for you.  Good luck, and happy travels!