> and literally has almost no downside to accepting any customer for currency exchange
So, there are a few things going on. First of all, there are downsides; in particular, it’s a money laundering risk. But also, it’s logistically expensive; the bank has to keep a stock of foreign money, and occupy an actual human dealing with it, and, these days, the rates they can reasonably charge for it are pretty low.
If you’re looking for someone to blame for this, probably primarily blame the free market. Traditionally, banks did physical FX, at rates that were generally a horrendous ripoff, but all consumer FX was a horrendous ripoff so what were you going to do. Today, it’s possible for consumers to do FX with costs in the 0.5% range, lower for large amounts or if they pay upfront for Revolut’s premium plan or something. This doesn’t leave much margin for the banks if they want to be even vaguely competitive, so they’re only going to do it if it’s cheap to do. It is not cheap to do.
This is actually generally a positive outcome for most consumers; FX is much cheaper and more convenient than it used to be for more people; it’s only if you want to exchange physical money that it has become more difficult.
So, there are a few things going on. First of all, there are downsides; in particular, it’s a money laundering risk. But also, it’s logistically expensive; the bank has to keep a stock of foreign money, and occupy an actual human dealing with it, and, these days, the rates they can reasonably charge for it are pretty low.
If you’re looking for someone to blame for this, probably primarily blame the free market. Traditionally, banks did physical FX, at rates that were generally a horrendous ripoff, but all consumer FX was a horrendous ripoff so what were you going to do. Today, it’s possible for consumers to do FX with costs in the 0.5% range, lower for large amounts or if they pay upfront for Revolut’s premium plan or something. This doesn’t leave much margin for the banks if they want to be even vaguely competitive, so they’re only going to do it if it’s cheap to do. It is not cheap to do.
This is actually generally a positive outcome for most consumers; FX is much cheaper and more convenient than it used to be for more people; it’s only if you want to exchange physical money that it has become more difficult.