BajaNomad - Currency Exchange

Currency Exchange

motoged - 12-18-2010 at 07:01 PM

I have had a day or two to calm down, but " Boy, was I steamed!!!" :wow:

I bought $8000 MP through my bank last week when the Canadian dollar was $99.96 US$....I expected some service fees on top of exchange rate, but my cost was $704 CDN (US about a few $ less)...I expected it to cost me about about $650 or so CDN. :barf:

After I put the top of my head back on, I tried to get the bank manager to break down the transaction costs but she was unable to explain the difference between the exchange rate and the final cost (which would have been the bank's service fees).

Am I out of touch or what :?:

I understand the Googled currency exchange sites give an exchange rate that does not include any type of service fee http://www.xe.com/ucc/,

but what do you folks pay when you go to the bank?

My bank manager tried to convince me that Casa de Cambios would also charge about a 8-10% fee over the rate posted on a currency exchange site as mentioned above....

Just askin'

woody with a view - 12-18-2010 at 07:10 PM

i think they MIGHT add 1%.

shari - 12-18-2010 at 08:25 PM

its tough to figure out...I see something like 12.65 on the exchange websites and then only get 12.2 or even 11.9 at the banks...different banks have different rates too although the tellers told me the exchange rate was the same at all banks...NOT.

longlegsinlapaz - 12-18-2010 at 08:28 PM

Motoged, I'd have told your bank manager if they can't explain the fees they charge for the services they provide that you expect then to reverse their fees immediately!! :light:

Why did you bother getting pesos anyway, it's a well-documented fact that USD is accepted everywhere in Baja & since Canada is a neighbor of the USA & Mexico is a neighbor of the USA as well, you just tell all the Mexican businesses you're paying in your currency & that's that! Oh! Be sure you tip them well & they'll be grateful to take your money! :no:

Kudos to you for respecting the currency of the country you'll be visiting! :bounce:

[Edited on 12-19-2010 by longlegsinlapaz]

DENNIS - 12-18-2010 at 09:08 PM

Quote:

Originally posted by motoged
My bank manager tried to convince me that Casa de Cambios would also charge about a 8-10% fee over the rate posted on a currency exchange site as mentioned above....

Just askin'

Competitive Cambios are usually 2% lower than the official money market rate. They arn't regulated but they are volatile. You can see them changing the rate signs throughout the day.

El Comadante Loco - 12-18-2010 at 09:39 PM

Exchange rate, 12.25 today in Calexico and Mexicali and no commission.. however I no longer exchange at any casa de cambio..
I use my ATM card at Bancomer and get a better rate than at the casa de cambio which makes up for more than the ATM fee of 22 pesos...

karenintx - 12-18-2010 at 10:10 PM

Used my BOA ATM card at Scotia Bank tonight and got a 12.41 pesos exhange with no ATM fee. My only complaint is Scotia Bank has lowered the daily withdrawal amount down to 3,000 pesos...use to get 5,000 pesos.

Pescador - 12-19-2010 at 08:02 AM

I know the discussion of using dollars instead of pesos has been drug through the mud and back, but there is a real issue now with the banks in Mexico. The most dollars that can be deposited in to a Mexican account in one month is $4,000 and anything over $1250 (actually $15,000 pesos) for the month is subject to a 3% tax. Some genius in the federal government thought that would stop all money laundering of drug profits, but instead has turned into a virtual nightmare with trying to build or hire contractors or almost any other business transaction. I have a friend who is a fairly small businessperson in the Santa Rosalia area and has found it necessary to open up 8 accounts to deal with this issue. So, be aware that they will take dollars if forced to, but they have to make up the loss by lowered exchange rates to try to break even.

MitchMan - 12-19-2010 at 08:18 AM

Mexican banking is an absolute mess. The government excercises poor timing and myopic thinking when they make new mandates.

It's like their top government people were the sons of rich Mexicans who sent their priviledged kids to US American Ivy League Schools where their kids got C's, came back to Mexico, immediately got great jobs in high places in Government finance without any experience and then started making laws to attempt to cure perceived problems in one felled swoop. The result is a continuous stream of heavy handed detrimental stupid policy executed at the ground level by people that have no understanding of the why's and wherefores of what they are implimenting and no curiosity of their own on the matter itself.

[Edited on 12-19-2010 by MitchMan]

oladulce - 12-19-2010 at 08:20 AM

Quote:

Originally posted by karenintx
Used my BOA ATM card at Scotia Bank tonight and got a 12.41 pesos exhange with no ATM fee. My only complaint is Scotia Bank has lowered the daily withdrawal amount down to 3,000 pesos...use to get 5,000 pesos.

I got $5000 pesos at ScotiaBank Ensenada branch using my BofA ATM card 4 days ago.

karenintx - 12-19-2010 at 09:22 AM

Quote:

Originally posted by oladulce

Quote:

I got $5000 pesos at ScotiaBank Ensenada branch using my BofA ATM card 4 days ago.

Interesting...must be different limit amounts in different cities. Imagine that! Oh well we are going to SJD later this week to pick-up a friend. Think we will try the Scotia Bank that is next to Applebee's. Also we have noticed that Santander has also lowered their daily limit...at least the ones close to us in CSL.

.

[Edited on 12-19-2010 by karenintx]

monoloco - 12-19-2010 at 09:49 AM

Quote:

Originally posted by Pescador
I know the discussion of using dollars instead of pesos has been drug through the mud and back, but there is a real issue now with the banks in Mexico. The most dollars that can be deposited in to a Mexican account in one month is $4,000 and anything over $1250 (actually $15,000 pesos) for the month is subject to a 3% tax. Some genius in the federal government thought that would stop all money laundering of drug profits, but instead has turned into a virtual nightmare with trying to build or hire contractors or almost any other business transaction. I have a friend who is a fairly small businessperson in the Santa Rosalia area and has found it necessary to open up 8 accounts to deal with this issue. So, be aware that they will take dollars if forced to, but they have to make up the loss by lowered exchange rates to try to break even.

Those rule only apply to cash deposits, you can transfer as many dollars as you wish from a US account without penalty. It is a problem for Mexican businesses but shouldn't be a problem for foreigners unless they are transporting large amounts of currency.

Timo1 - 12-19-2010 at 10:09 AM

Ged
Next time you're in Van. go out to the airport and exchange there.
Their rate is far better than any bank
They don't have a "spread" like banks
Also all currencies have a buy/sell rate
When the Canuck buck was at 1.06 I bought six thousand USD
That cost me 200 bucks
HUH ????...Learned my lesson about banks
Also Customs House in North Van is really good
Hope this helps

[Edited on 12-19-2010 by Timo1]

dtbushpilot - 12-19-2010 at 10:37 AM

The worse (by far) exchange rate that I ever got was from my home town bank in New Mexico. They had to bring them in from somewhere, took about a week, seems like I got about 3/4 of what I expected. That was a long time ago before the advent of ATM's on every corner.

I use my bank card but try to only use it at a bank ATM, I feel like the security is better.....maybe. My dad tried to get pesos from an ATM at the TJ airport, it declined his request the first time and kept his card the second time he tried it. When he got here we called the bank to cancel the card and found that his card had been charged for one of the withdrawal attempts. At least there wasn't any other activity on the card.

As I typed this story it occurred to me that because of this incident my dad arrived here with no money and no way to get any. I had to foot the bill for everything that we did for the week he was here.........I wonder if the machine really kept his card or if I've been outsmarted by him......again.....

wilderone - 12-19-2010 at 11:15 AM

Which bank was this -- just askin - so others can avoid.

"My bank manager tried to convince me that Casa de Cambios would also charge about a 8-10% fee over the rate posted on a currency exchange site as mentioned above"

Rhetorical, but why did you exchange such a large sum all at once? You didn't ask about their currency exchange policy before you did this? Privileges for the type of accounts you have (waiver of fees)? Banks will nickel and dime you to death. A fee for a notary, application fee, service fee, etc. Call them anonymously now and ask - no reason why somebody shouldn't give a straight answer. 8%-10%? That's outrageous. There are MANY options for currency exchange, as you now know. If you're trying to make money with FOREX trading, it's extremely volatile, but with some study and practice, can be profitable. (Not done through normal retail procedures, however).

DianaT - 12-19-2010 at 11:19 AM

Quote:

Originally posted by dtbushpilot

As I typed this story it occurred to me that because of this incident my dad arrived here with no money and no way to get any. I had to foot the bill for everything that we did for the week he was here.........I wonder if the machine really kept his card or if I've been outsmarted by him......again.....

motoged - 12-19-2010 at 12:42 PM

WO,
Thanks...your reply responds best to my query:

Royal Bank was the userer :no:

I will never make this mistake again....I did ask initially what the service fee would be and the clerk said "just the exchange rate"....

I am aware of and usually do the ATM thing in Mexico once travelling, and usually exchange several hundred US dollars at border Casa de Cambios to get my first fistfull of pesos.

I try to use pesos instead of US dollars whenever I can once south of the border.

I wanted that much in pesos as I am anticipating being away fro ATM's for the first several days in Baja and so that money exchange hassles were not on my "To Do" list for the first several days of motorcycling back routes.

That exchange cost me a room and fish taco feed :fire:

Quote:

Originally posted by wilderone
Which bank was this -- just askin - so others can avoid.

"My bank manager tried to convince me that Casa de Cambios would also charge about a 8-10% fee over the rate posted on a currency exchange site as mentioned above"

Rhetorical, but why did you exchange such a large sum all at once? You didn't ask about their currency exchange policy before you did this? Privileges for the type of accounts you have (waiver of fees)? Banks will nickel and dime you to death. A fee for a notary, application fee, service fee, etc. Call them anonymously now and ask - no reason why somebody shouldn't give a straight answer. 8%-10%? That's outrageous. There are MANY options for currency exchange, as you now know. If you're trying to make money with FOREX trading, it's extremely volatile, but with some study and practice, can be profitable. (Not done through normal retail procedures, however).

capitolkat - 12-19-2010 at 02:31 PM

Went to Banamex today Sunday-and got pesos from the ATm. Banamex is linked to our Citibank account and we got 12.41 and no transaction fees. We have never paid a transaction fee so long as we use Banamex to access our Citibank account.

DENNIS - 12-19-2010 at 02:50 PM

Quote:

Originally posted by capitolkat
Went to Banamex today Sunday-and got pesos from the ATm. Banamex is linked to our Citibank account and we got 12.41 and no transaction fees. We have never paid a transaction fee so long as we use Banamex to access our Citibank account.

Really? Today I used a Banamex ATM and at the start of the transaction, the screen says there will be a charge of 28+ Pesos to continue. When I use an HSBC ATM the charge on the screen is less by a bit, but still there.
Question is....who gives up the charge when cooperating banks are involved in a withdrawal....the US bank or the Mexican bank? I can't believe the Mexican bank would be giving this free service.

My home bank is Chase.

Bajahowodd - 12-19-2010 at 03:18 PM

Frankly, I never really worried about chump change when making a withdrawal at an ATM in Mexico. Obviously, there a a couple of posts above that far exceed chump change.

My bank is Chase, too. I get charged $3 by them every time I make a withdrawal. But, that fee is assessed on any transaction at a non-Chase ATM. Checking my recent statement, there is also some foreign currency transaction adjustment. It amounts to something slightly less than $3. So, what I'm guessing is that the Mexican bank gets the adjustment fee, and Chase gets the other fee for non-Chase ATM use.

DENNIS - 12-19-2010 at 04:03 PM

Yeah...seems to be just like that. I get the 3 buck charge as well. 28 Ps plus 3 bucks every time I use the ATM here.
I'm not complaining at all. It's just the price of modern convenience.

Pescador - 12-19-2010 at 05:12 PM

Monoloco says:Those rule only apply to cash deposits, you can transfer as many dollars as you wish from a US account without penalty. It is a problem for Mexican businesses but shouldn't be a problem for foreigners unless they are transporting large amounts of currency.

Pescador says: I was told that it did not matter even if I wired pesos in to my Mexican account which I can do with Chase bank, so I sure would like to get more information about how to accomplish that. Of course the wire fees are around $45 to wire pesos, but that would still be better than paying 3% tax.

[Edited on 12-20-2010 by Pescador]

woody with a view - 12-19-2010 at 05:27 PM

i used to get pesos from HSBC in san q and my charges thru wells fargo would be reversed on my monthly statement.

after we bailed out wells fargo it seems that they thank me by no longer reversing the fee.

bajalou - 12-19-2010 at 05:29 PM

Quote:

Originally posted by Bajahowodd
My bank is Chase, too. I get charged $3 by them every time I make a withdrawal. But, that fee is assessed on any transaction at a non-Chase ATM. Checking my recent statement, there is also some foreign currency transaction adjustment. It amounts to something slightly less than $3. So, what I'm guessing is that the Mexican bank gets the adjustment fee, and Chase gets the other fee for non-Chase ATM use.

I think you'll find that Chase gets both the ATM and Foreign Currency fees. The Mexican bank adds it's charges to the amount charged to Chase.

bajalou - 12-20-2010 at 09:29 AM

Here is a link to a Financial Blog on these conversion fees.

http://bucks.blogs.nytimes.com/2010/12/17/more-cards-waive-f...

wilderone - 12-20-2010 at 09:44 AM

Lots of consumer action to fight excessive fees. This earlier action pointed the finger at several big banks. But consumers need to complain and not accept excessive fees allowing banks to proliferate the practice.

http://www.xomba.com/www_ccfsettlement_com_the_foreign_curre...

DENNIS - 12-20-2010 at 09:58 AM

Quote:

Originally posted by wilderone
Lots of consumer action to fight excessive fees. This earlier action pointed the finger at several big banks. But consumers need to complain and not accept excessive fees allowing banks to proliferate the practice.

It will be a tough fight. Fees are all banks have as income. Regulate them too severely and they'll cease to exist.

Oh well....they won't loan us our money anyway.

durrelllrobert - 12-20-2010 at 10:40 AM

just witdrew 5000MN from HSBC ATM which aded on a 24 peso charge + 2.64 IVA (total = 5026.64). my wells fargo bank ithdrew $406 plus a $5 service charge from my account ($411 total) so i ended up getting an overall exchange rate of 12.23, just slightly below the "official" rate of 12.40 or a 0.014% delta :biggrin: