In today’s global economy, cross-border payments are essential for businesses of all sizes. Yet, despite digital innovation making it easier to move money across borders, many traditional banks are still stuck in the past, relying on hidden FX fees and opaque pricing structures that quietly chip away at your profits. All while charging some of the highest FX bank fees in the industry.

For CFOs, finance managers, and entrepreneurs, these hidden charges can become a frustrating barrier to growth, eating into margins and limiting global ambitions. While banks promise convenience and security, the reality is often far less straightforward. You’re left with little transparency, no clear explanations, and a growing sense that your business could get a better deal. A recent Financial Conduct Authority report highlighted mixed practices regarding international payments, charges and transparency.

That’s where BLK.FX comes in with a mission to make international payments smarter, simpler, and more transparent. We’ll now explore why traditional banks overcharge on FX and how you can bypass these outdated systems for a faster, fairer way to manage your money internationally.

Why traditional banks overcharge on FX

Only when you look at the charges and often minimal levels of transparency do you begin to understand why and how traditional banks regularly overcharge on FX transactions. There are several issues to consider, such as:

The legacy of big banks

Due to significant technological advancements, the assumption that banks need to rely on outdated, costly systems, thereby increasing their overheads, is obsolete. However, there is a significant difference between tech-oriented FX services and those which depend, to varying degrees, on legacy systems.

The lack of transparency

While there is no doubt that the Financial Conduct Authority is looking to change how FX transactions are carried out and costs are applied, this could take time. Currently, many banks hide behind FX charges within the "spread" instead of quoting visible upfront fees. So, you may see services advertised as "no fees", but the exchange rate is often far removed from the mid-market rate - disguising hidden FX charges that many businesses don’t spot until it’s too late..

Monopoly and customer inertia

For many, investment and finance are the last bastions of tradition, although we are seeing movement on historic monopolies and customer inertia. A mixture of some banks exploiting long-standing client relationships and CFOs, financial managers and freelancers slow to switch has left many customers exposed to excessive charges.

Key statistics

Even when faced with evidence of the issues many businesses and consumers face, it is always helpful to put this in perspective. A report by Wise found that consumers and SMEs lost £5.6 billion in cross-border fees in 2022. The company also reported a £2.8 billion loss in 2023 for British SMEs in what were described as "rip-off" bank FX fees. Thankfully, pressure on the previous and current governments has prompted some movement on the regulatory front, and we await confirmation of future changes.

Hidden FX charges explained

As the regulator looks at "encouraging" more transparency in the FX sector, it's crucial to appreciate how charges can be subtly increased. Ironically, this prompts the question, why do consumers and businesses not compare and contrast transaction charges?

Some of the ways in which FX charges can increase include:

The conversion spread

Money markets dictate the basis exchange rate for any currency pairings, with particular reference to the mid-market interbank rate. This is the exchange rate between banks, although it is not necessarily quoted to clients. Even a relatively small increase in the spread impacts the excess charges on large and regular transactions.

Example:

When exchanging sterling for euros, the mid-market rate might be 1 to 1.15, but your bank may only offer 1 to 1.12. While the 0.03 point spread may seem irrelevant, it equates to more than 2.5%. So, those "no-fee" FX transactions have quickly become very expensive!

It is not uncommon for banks to change their spreads according to the client’s profile, size, and regularity of transactions. However, the charge/spread could be as low as 0.5% when dealing with specialist FX providers.

Payment fees and transfer costs

Many traditional banks also charge a flat fee, separate from any FX spreads, for sending and receiving international payments. These could be between £20 and £40 per transaction, and some banks will even charge additional fees for inward payments. It's not always easy to see the increase in relative cost as these additional charges are layered on top of the original spread.

Account maintenance and miscellaneous charges

For those who continue to deal with traditional banks, the additional fees relating to account maintenance and miscellaneous charges may appear standard. Some banks will charge extra for:

• Statements
• Balance checks
• Admin tasks
• Minimum balance requirements
• Closure/inactivity

While rarer now than in years gone by, it was not unheard of for banks to charge additional fees for currency conversion within the same bank, i.e., for two different currency accounts. In isolation, these extra charges may look “irrelevant”, but they soon add up, and those who trade in large amounts or more frequently will quite literally pay the price.

How to avoid overpaying: Cheaper alternatives to bank FX

In the early days of the FinTech revolution, some businesses and individuals were reluctant to switch, often unaware of just how much hidden FX charges were costing them. Slowly but surely, as the cost savings become clearer, there is less reluctance to switch.

FinTech FX providers

Whether looking at personal finance, business or broader investment, there is no doubt that the FinTech revolution has touched all areas of the financial sector. Considering the above information, it's no surprise that the FX sector is particularly benefiting from enhanced efficiencies supported by new technology. In some ways, this has created a three-tier sector made up of the following:-

• Legacy banks
• Broader FinTech-supported financial services
• FX technology-enhanced specialists

As a specialist FX service provider, we differentiate ourselves through our service, experience, and expertise in this field. In contrast to legacy banks, we work in real time, with transparent rates and markedly lower FX charges.

The benefits become much clearer when you add innovative platforms and faster onboarding with no need for a traditional banking relationship. Digitised platforms, API integrations, and significant automation are all provided under a strong regulatory and compliance structure, changing how individuals and businesses consider FX transactions.

Multicurrency accounts with no hidden fees

While holding multicurrency accounts with the same provider has obvious operational benefits, it also offers significant cost savings. All BLK.FX clients can open multicurrency accounts, which is particularly useful when receiving funds and paying suppliers in a foreign currency (it removes the need to convert funds constantly). 

The benefits of BLK.FX multicurrency accounts include:

• No monthly maintenance charges
• No fees for receiving payments
• Free same-day payments in core currencies

This eliminates the need to hold multiple local bank accounts in different countries, allowing clients to better control their currency exposure. It also simplifies treasury management for SMEs and scale-ups and is ideal for global payroll, supplier payments, marketplace collections, etc.

Personalised FX strategy and risk management

There are obvious benefits to using FX service providers that are more appreciative of the latest cutting-edge technology. However, BLK.FX goes one step beyond that by providing personalised FX strategies. We offer a range of services such as:-

• Bespoke FX advice
• Experienced, dedicated account managers
• Advice on building FX hedging strategies
• Proactive approach to rate alerts, market forecasts and economic updates
• Invaluable human guidance in volatile markets
• Ability to support complex/high-risk sectors through strategic partnerships

Collectively, these elements create significant cost savings and stability, helping support returns on investment for CFOs and the self-employed.

Why BLK.FX is different

Let’s be honest - most FX providers tend to focus solely on rates. But at BLK.FX, we believe great pricing is just the beginning. What truly sets us apart is how we combine competitive margins with genuine human service and real strategic thinking.

A personalised, human approach

Forget faceless portals and call centre hold music. With BLK.FX, you get round-the-clock access to a dedicated account manager - a real person who knows your business, understands your objectives, and is invested in your success. Whether you're hedging risk, timing a significant transaction, or needing strategic input, we're right there with you. There are no bots or scripts; just experienced FX consultants who speak your language.

Competitive FX rates and free payments

Our clients enjoy ultra-competitive FX rates, typically with margins below 1%. We don't do hidden fees. No "admin charges" or unpleasant surprises are buried in your transaction history. What you see is what you get. Combine that with fee-free same-day payments and no-cost multicurrency accounts, and the savings quickly become real.

Flexibility and security

From SME importers to publicly listed groups, elite athletes to global e-commerce sellers, we support a diverse range of clients with complex, often high-risk financial profiles. Thanks to our strong partner network and flexible onboarding, we help businesses that others can’t, or won’t, touch. All of this is wrapped in Tier 1 FinTech infrastructure and FCA-regulated security.

Client success snapshot

One UK-based e-commerce firm came to us after years of overpaying with their bank. Within 12 months, we helped them save over £100,000 on FX transactions alone - a direct result of eliminating unnecessary FX bank fees and gaining better control. That’s the BLK.FX difference.

Key takeaways

Traditional banks have been overcharging businesses on FX for too long. CFOs and financial decision-makers have accepted this as the norm. Hidden spreads, layered fees, poor service, and little-to-no strategic guidance have quietly cost companies thousands, if not millions.

But it doesn’t have to be that way. 

Modern FinTech platforms have rewritten the rulebook, offering speed, transparency, and cost savings. Yet what truly unlocks value is when technology meets tailored, human expertise. That’s where BLK.FX stands apart. We combine cutting-edge financial infrastructure with real people, real advice, and real support, so you’re never navigating currency decisions alone.

If you're a business that trades globally, you don't need to settle for "just OK" anymore. There's a more innovative, faster, more personal way to handle your FX, and we're ready to show you how.

👉 Learn more about how BLK.FX can reduce your FX costs. Contact us today to see real-world savings on your next transaction.