If you’re exchanging currency in Edmonton, where you exchange matters as much as when you exchange. The difference between bank rates and online currency exchange rates can cost you hundreds or even thousands of dollars on a single transaction.
We’ve analyzed actual exchange rates from major Edmonton banks and compared them to online currency exchange services. This breakdown shows you exactly how much you’re paying in hidden markups and fees—and how much you could save by choosing a different provider.
How Currency Exchange Rates Actually Work
When you see currency exchange rates advertised, you’re rarely seeing the “real” rate. The interbank rate (also called the mid-market rate) is what banks and large financial institutions pay when they exchange currency with each other. It’s the fairest, most accurate rate available.
Every currency exchange provider—whether a bank, airport kiosk, or online service—adds a markup to this interbank rate. That markup is how they make money. The question is: how much markup are they adding?
Let’s say the interbank rate for USD/CAD is 1.3500. Here’s what different providers might quote you:
| Provider Type | Typical Rate Markup | Quoted Rate | Cost to Buy $1,000 USD |
|---|---|---|---|
| Interbank Rate (Baseline) | 0% | 1.3500 | $1,350 CAD |
| Online Currency Exchange | 0.5-1% | 1.3575 | $1,357.50 CAD |
| Major Edmonton Banks | 3-5% | 1.3905 | $1,390.50 CAD |
| Edmonton Airport Kiosks | 7-12% | 1.4445 | $1,444.50 CAD |
The markup might seem small as a percentage, but it adds up quickly in real dollars. On a $1,000 USD exchange, you’d pay $33 more at a typical online exchange compared to the interbank rate—but $40.50 at a bank and $94.50 at an airport kiosk.
Real Exchange Rate Comparison: Edmonton Banks vs Online
Let’s look at actual examples with different transaction amounts. These calculations assume an interbank rate of 1.3500 USD/CAD, with typical markups applied by each provider type.
Small Transaction: $500 USD
| Provider | Exchange Rate | Total Cost (CAD) | Extra Cost vs Online |
|---|---|---|---|
| Online Exchange | 1.3575 | $678.75 | – |
| TD Bank | 1.3905 | $695.25 | $16.50 |
| RBC | 1.3905 | $695.25 | $16.50 |
| Scotiabank | 1.3905 | $695.25 | $16.50 |
Even on a relatively small $500 USD exchange, using a bank instead of online currency exchange in Edmonton costs you an extra $16.50. That’s enough for a meal or tank of gas.
Medium Transaction: $3,000 USD
| Provider | Exchange Rate | Total Cost (CAD) | Extra Cost vs Online |
|---|---|---|---|
| Online Exchange | 1.3575 | $4,072.50 | – |
| TD Bank | 1.3905 | $4,171.50 | $99.00 |
| RBC | 1.3905 | $4,171.50 | $99.00 |
| Scotiabank | 1.3905 | $4,171.50 | $99.00 |
At $3,000 USD—a common amount for vacation spending or small business transactions—the bank markup costs you $99. This is where the savings become significant enough to justify the minimal extra effort of using an online service.
Large Transaction: $10,000 USD
| Provider | Exchange Rate | Total Cost (CAD) | Extra Cost vs Online |
|---|---|---|---|
| Online Exchange | 1.3575 | $13,575 | – |
| TD Bank | 1.3905 | $13,905 | $330 |
| RBC | 1.3905 | $13,905 | $330 |
| Scotiabank | 1.3905 | $13,905 | $330 |
For larger amounts like $10,000 USD—common for property purchases, major business expenses, or extended international stays—the bank markup costs $330. These are savings that directly impact your budget or business bottom line.
Hidden Bank Fees Beyond Exchange Rates
The exchange rate markup isn’t the only cost when using banks for currency exchange. Most Edmonton banks also charge additional fees that further increase your total cost:
Wire transfer fees: Banks typically charge $15-$50 to send an international wire transfer. If you’re sending USD to a US bank account, this fee applies on top of the exchange rate markup.
Receiving fees: Some banks charge $10-$25 to receive international wire transfers. Your recipient might pay this fee, reducing the amount they actually receive.
Cash exchange fees: Want physical USD cash from your bank? Some branches charge an additional $5-$10 fee for cash currency orders, especially if you need bills delivered to your branch.
Foreign currency account fees: Maintaining a USD bank account costs $3-$5 monthly at most Edmonton banks. Over a year, that’s $36-$60 in maintenance fees.
Let’s add these to our $3,000 USD example:
- Bank exchange rate markup: $99
- Wire transfer fee: $30
- Monthly USD account fee (annualized): $48
- Total extra annual cost: $177+
Online currency exchange services typically don’t charge these additional fees. You pay the exchange rate markup and nothing more. Understanding how bank rates compare to online services helps you see the full picture of costs involved.
Why Banks Charge Higher Exchange Rates
It’s not that banks are being dishonest—they’re just operating under a different business model. Banks have significant overhead costs that currency exchange helps offset:
Branch networks: Maintaining physical branches across Edmonton and Alberta is expensive. Rent, utilities, staff, security systems, and branch maintenance all cost money. These costs get factored into various bank fees and service charges, including currency exchange markups.
Regulatory compliance: Banks face extensive regulatory requirements and reporting obligations. While online currency exchange providers like us also comply with FINTRAC regulations, banks have additional layers of compliance across all their banking services.
Multiple service offerings: Banks provide dozens of different financial services. Currency exchange is a small part of their business, and they price it to subsidize other services or account types.
Profit margins: Banks are publicly traded companies with shareholder expectations. They need to generate profits across all services, and currency exchange is a relatively easy area to maintain high margins since most customers don’t shop around.
Online currency exchange services operate with minimal overhead. We don’t have branch networks or hundreds of employees. We focus specifically on currency exchange, which allows us to offer much tighter margins while still running a sustainable business.
When Banks Might Make Sense for Currency Exchange
Despite higher costs, there are some scenarios where using your Edmonton bank for currency exchange might be the practical choice:
Very small amounts (under $200): If you need $100 USD for a day trip across the border, the $5-$10 you’d save with online exchange might not justify the setup time. For tiny amounts, convenience sometimes wins over savings.
Immediate cash needs: If you need physical USD currency in the next hour and your bank branch has it available, that convenience might be worth the premium. Online services typically require 1-2 business days for processing.
Existing premium banking packages: Some high-tier bank accounts include better exchange rates or waived fees as part of their package. If you’re already paying for premium banking, check whether you get preferential currency exchange rates.
Complex international transactions: For very large or complex international business transactions involving letters of credit, trade financing, or specific regulatory requirements, your bank’s full-service approach might provide value beyond just the exchange rate.
For most common currency exchange needs—travel spending, property purchases, business payments, sending money to family abroad—online currency exchange offers significantly better value.
How Online Currency Exchange Works in Edmonton
If you haven’t used online currency exchange before, the process is simpler than you might expect. Here’s how it works with our service:
Step 1: Check rates – Visit our website to see current exchange rates for all major currencies. Our rates update in real-time based on market conditions.
Step 2: Lock your rate – Once you’re satisfied with the rate, you can lock it in for your transaction. This protects you from rate fluctuations during processing.
Step 3: Transfer funds – Send your Canadian dollars via electronic bank transfer (Interac e-Transfer or wire transfer) from any Canadian bank account. This takes minutes through your online banking.
Step 4: Receive your currency – We convert your funds at the locked-in rate and transfer the foreign currency to your specified destination—whether that’s a US bank account, an international wire, or delivery of physical cash.
The entire process typically takes 1-2 business days, comparable to bank wire transfers but at a fraction of the cost. We’re regulated by FINTRAC just like banks, ensuring your transactions are secure and compliant with Canadian financial regulations.
For Edmonton residents, we provide the same convenience as your bank—you can complete everything from home through our online platform or mobile app—but with exchange rates that save you significant money.
Real Edmonton Customer Savings Examples
Here are some real scenarios from Edmonton customers who’ve switched from banks to online currency exchange:
Snowbird heading to Arizona: Exchanges $15,000 USD annually for winter expenses. Bank markup was costing $495 per year. After switching to online exchange, saves $430 annually—enough for a nice dinner out every month in Phoenix.
Small business importing from US: Exchanges $50,000 USD quarterly for supplier payments. Bank fees and markups totaled $1,650 per transaction ($6,600 annually). Online exchange saves approximately $5,400 per year, which the business reinvests in inventory.
Parent paying international student tuition: Sends $25,000 USD annually for daughter’s college expenses. Bank costs were $825 per year in markups and fees. Online exchange reduces this to $250, saving $575 annually.
Couple buying US vacation property: Exchanged $200,000 USD for Florida condo purchase. Bank would have charged approximately $6,600 in markups. Online exchange saved $5,200—essentially covering their closing costs.
These aren’t exceptional cases. They represent typical savings available to Edmonton residents who take a few minutes to compare their options before exchanging currency.
How to Calculate Your Potential Savings
Want to know exactly how much you could save? Here’s a simple formula:
- Determine how much foreign currency you need (e.g., $5,000 USD)
- Check your bank’s current exchange rate for that currency
- Check an online currency exchange rate for the same currency
- Multiply the amount by each rate to see your total cost
- Subtract the online cost from the bank cost
For example:
- Amount needed: $5,000 USD
- Bank rate: 1.3905 = $6,952.50 CAD
- Online rate: 1.3575 = $6,787.50 CAD
- Your savings: $165
If you exchange currency regularly, multiply your per-transaction savings by how many times you exchange annually. A business exchanging $5,000 USD monthly would save $1,980 per year by switching from banks to online exchange.
You can also use our currency converter to quickly compare costs at different exchange rates.
Common Concerns About Online Currency Exchange
Is it safe?
Yes, when using a FINTRAC-regulated provider. We follow the same security and compliance standards as banks, including identity verification, transaction monitoring, and secure fund transfers. Our A+ BBB rating reflects our commitment to secure, reliable service.
Will it take longer than my bank?
No. Most transactions complete in 1-2 business days, the same timeframe as bank wire transfers. For urgent needs, we often accommodate same-day or next-day processing.
What if I need physical cash?
We can arrange physical currency delivery for most major currencies. While this takes slightly longer than electronic transfers, you’ll still save significantly compared to bank cash exchange rates.
Is there a minimum transaction amount?
Requirements vary by provider. We typically work best for transactions of $500 or more, where the savings justify the setup process. For smaller amounts, your bank might be more convenient despite the higher cost.
What if exchange rates change while I’m processing?
When you lock in a rate with us, that rate is guaranteed for your transaction regardless of subsequent market movements. You’re protected from adverse rate changes during the processing period.
Making the Switch: What Edmonton Residents Should Know
Switching from your bank to online currency exchange doesn’t require closing accounts or changing your banking relationships. Most Edmonton residents keep their regular bank accounts and simply use online services specifically for currency exchange.
Here’s what the transition looks like:
First transaction setup: You’ll need to verify your identity and provide banking information. This is a one-time process that typically takes 10-15 minutes. It’s a FINTRAC requirement for all currency exchange providers.
Subsequent transactions: Once your account is established, future exchanges take just minutes to initiate. You can complete everything through our online platform or by contacting our team directly.
Keeping your bank account: You don’t need to close your bank accounts or change any other banking services. You’ll simply use online exchange for currency conversion while maintaining your regular banking for everything else.
Building a relationship: Over time, we get to know your typical currency needs and can provide even better service. Regular clients often receive preferential rates on larger transactions.
For Edmonton residents who exchange currency regularly—whether for travel, business, or personal reasons—the annual savings from switching to online exchange typically range from a few hundred to several thousand dollars.
Other Currency Exchange Options in Edmonton
Beyond banks and online services, Edmonton residents have a few other options for currency exchange:
Airport kiosks: Edmonton International Airport has currency exchange counters, but these typically offer the worst rates of any option—often 7-12% above interbank rates. Only use these for small emergency amounts.
Currency exchange storefronts: Some independent currency exchange businesses operate in Edmonton shopping areas. Rates vary widely, so compare carefully. Some offer competitive rates similar to online services, while others are closer to bank rates.
Credit cards with no foreign transaction fees: For travel purchases, some credit cards offer good exchange rates without foreign transaction fees. This works well for purchases but doesn’t help if you need cash or need to make bank-to-bank transfers.
Peer-to-peer currency exchange: Some online platforms connect people who need opposite currency exchanges. These can offer good rates but require more effort and coordination.
For most Edmonton residents, online currency exchange provides the best combination of competitive rates, convenience, security, and speed. If you’re interested in exploring options for specific currencies, check our guides on USD exchange and EUR exchange.
Frequently Asked Questions
How much better are online exchange rates compared to Edmonton banks?
Online currency exchange rates are typically 2-3% better than major bank rates. On a $5,000 USD exchange, this translates to approximately $100-$165 in savings per transaction.
Do I need to close my bank account to use online currency exchange?
No. Most people keep their regular bank accounts and simply use online services specifically for currency exchange. You’ll still use your bank account to transfer funds to and from the online exchange service.
How long does online currency exchange take?
Most transactions complete within 1-2 business days, similar to bank wire transfers. For urgent needs, we can often accommodate same-day or next-day processing.
Is online currency exchange safe?
Yes, when using FINTRAC-regulated providers. We follow the same security standards as banks, including identity verification, secure fund transfers, and transaction monitoring. All reputable online currency exchange services in Canada must register with FINTRAC.
What’s the minimum amount I can exchange online?
While we can process smaller amounts, online exchange makes most sense for transactions of $500 or more. Below that threshold, the time savings of using your bank might outweigh the cost savings.
Can I get physical USD cash through online currency exchange?
Yes, we can arrange physical currency delivery for most major currencies. This typically takes 2-3 business days but still offers significant savings compared to bank cash exchange rates.
How do I know I’m getting a fair exchange rate?
Compare the rate offered to the current interbank rate (available on Google or financial websites). A good rate should be within 0.5-1.5% of the interbank rate. Bank rates typically run 3-5% above interbank.
What if I need to exchange currency regularly for business?
Regular business clients often receive preferential rates and can set up recurring exchange schedules. For businesses, the savings from switching to online exchange can reach thousands of dollars annually. Learn more about business currency exchange solutions.
The difference between bank exchange rates and online currency exchange rates in Edmonton is substantial and consistent. For most currency exchange needs above $500, online services save you 2-3% on every transaction—savings that compound quickly for regular users.
Whether you’re exchanging currency for travel, business, property purchases, or personal reasons, taking a few minutes to compare your options can save you hundreds or thousands of dollars annually. The process is secure, straightforward, and typically no slower than using your bank.
Ready to see how much you could save on your next currency exchange? Check our current Edmonton rates or contact our team for a personalized quote based on your specific needs.
