Five Tips to Save on FX and transaction fees

Foreign transaction fee vs. FX fee vs. currency conversion fee

In practice, "international transaction fee" and "foreign transaction fee" are often used interchangeably by providers. It's the term you'll most often see printed directly on a card statement.

"FX fee" is broader: it's commonly used to refer to the overall cost of converting currencies, which can include the transaction fee itself, a separate conversion fee, an FX markup, or dynamic currency conversion (DCC). Here's how these actually break down:

This is why two providers can both say "no conversion fee" and still cost you very differently. If the fee is zero but the rate carries a 2% markup, you've paid for it anyway. It's just built into the exchange rate instead of listed as a line item. DCC works the same way: it's often presented as a convenience, but the rate behind it is usually worse than letting your card issuer handle the conversion.

When you're comparing providers or deciding whether to accept DCC at checkout, the rate matters more than whatever fee is or isn't listed separately.

The global foreign exchange market

Trading in the global FX market reached USD $9.6 trillion a day in April 2025, up 28% from USD $7.5 trillion just three years earlier, according to the Bank for International Settlements (https://www.bis.org/publications/202509-commentary-otc-derivatives). That's a sign of just how much cross-border payment volume businesses like yours are part of.

Southeast Asia's growing role in global FX

Southeast Asia is part of a much larger regional shift. Outbound cross-border payments from Asia-Pacific reached USD $13.5 trillion in 2025 and are projected to nearly double to USD $24 trillion, according to research from FXC Intelligence and Money 20/20.

That shift is visible at the ASEAN level too. Cross-border trade settled directly in local currencies among ASEAN member states rose 112% year-on-year to USD $14.1 billion between January and July 2025, according to Indonesia's central bank.

Singapore now handles 11.8% of global FX volumes, making it the world's third-largest FX trading centre after London and New York — average daily FX trading volume hit USD $1.485 trillion in April 2025, up 60% from 2022, according to the Monetary Authority of Singapore.

So, why should you look to save on FX?

Saving on FX fees can make a big difference for your business.

Here’s why it’s worth paying attention to:

• High FX Exposure: Foreign currency transactions come with a fee, though the exact charge or whether there's a separate fee at all varies by provider. Even with a 0% foreign transaction fee, an exchange rate markup can still apply.
• Steady Cash Flow: Lower, more predictable FX costs make it easier to forecast and manage cash flow, especially as your business takes on more currency exposure internationally.
• Stay Competitive: Keeping FX costs down may give you more room to price competitively, which matters more the more international your customer base becomes.

Why traditional banking might not be enough

Many businesses default to their banks for foreign exchange (FX) transactions since it's the most familiar option. It's worth knowing what to look out for:

• Additional Costs: Banks often have extra fees that aren’t easy to spot, like charges for converting currencies or processing payments.
• Fees for Each Transaction: Every FX transaction can come with its own fees, which can quickly add up.

In short, sticking with traditional banking for FX transactions might end up being more expensive than you expect.

Additionally, FX transaction costs are just one piece of the puzzle. There are several other fees you might encounter in your business transactions.

Let’s break down the different types of fees you might have to pay.

Types of FX and business transaction fees

1. FX-related fees

These fees are associated specifically with handling foreign currencies and international transactions:

FX Transaction Fee (International Transaction Fee): This fee comes into play when you buy something or make a payment in a foreign currency, but it can also apply to SGD transactions if the merchant or payment is processed overseas, depending on your provider.

For example, let's say your business in Singapore is purchasing office supplies from a supplier in the United States. If your credit card charges a 3% FX transaction fee on the USD $1,000 purchase, you'd be charged an additional USD $30 (3% of USD $1,000). Converted to SGD at a rate of 1.35, your total cost would be around 1,390.50 SGD.

FX Conversion Fee: This is a charge you pay when you exchange one currency for another.

For example, the total cost is USD $1,000. To pay this amount, you need to convert SGD to USD. If your bank charges a 2% FX conversion fee, and the current exchange rate is 1.35 SGD to USD $1, you would first convert 1,350 SGD to USD $1,000. The bank would then add a 2% fee on top of this, costing you an additional 27 SGD (2% of 1,350 SGD). So, you would pay 1,377 SGD in total.

SWIFT Fee: This fee is incurred when you process international wire transfers through the SWIFT network.

For example, if you’re transferring USD $20,000 to your US-based supplier, your bank might charge a USD $30 SWIFT fee for processing the transfer.

Currency Hedging Fee: Protecting your business from unexpected exchange rate movements, for example, through a forward contract isn't usually a simple flat fee. The cost is often built into the rate itself, through spreads, premiums, or other pricing terms that vary by instrument and provider.

For example, suppose your Singapore business needs to pay a European supplier EUR 10,000 in three months, and you're worried the euro might strengthen. You lock in today's exchange rate through a forward contract. The cost of this isn't a separate line-item fee — it's typically reflected in a slightly less favourable rate than the current spot rate, which is how the provider prices in the certainty they're giving you.

2. General transaction fees

Transaction fees generally apply to your debit, credit, or other payment card transactions and are charged by your bank or payment provider for processing these transactions. These could apply to both domestic and international money transfers:

Interchange Fee: They are charged by the card-issuing bank when processing credit or debit card transactions.

For instance, if you invoice a customer 500 SGD and they pay with a credit card, the issuing bank might charge a 1.5% interchange fee, totaling 7.50 SGD.

Issuing Bank Charge: It is the fee from your bank for using a company credit card, especially for international transactions.

For example, if you charge USD $1,000 on your credit card, the issuing bank might apply a 1.5% fee, totalling USD $15.

International Transfer / SWIFT Fees: Applied on wire payments. See the SWIFT Fee section above.

Receiving Fees: Some banks charge you even when you're being paid, not just when you pay out. It is worth checking both sides of a transaction, not just the outgoing one.

Correspondent / Intermediary Bank Fees: On cross-border wires that route through multiple banks before reaching the destination, each intermediary can deduct its own fee along the way, reducing what actually arrives.

Card Foreign Transaction Fees, FX-Rate Markup, and DCC Costs: A card foreign transaction fee is what your card issuer charges for a purchase in a foreign currency. An FX-rate markup is the difference between the exchange rate you're given and the actual market rate. DCC (Dynamic Currency Conversion) is when the merchant, not your card issuer, converts the purchase into SGD at checkout, usually at a worse rate. None of these are unique to card payments, the same mechanics can show up across other payment types too.

Other Fees: You may also come across terminal fees for point-of-sale processing, or account maintenance, overdraft, and statement fees, depending on your provider. These vary too much to generalise. Check your provider's fee schedule directly for exact figures.

So, how do you make sure these fees don't take a big bite out of your revenue? Let's find out.

5 ways to save on FX costs

As a business owner, keeping an eye on your foreign exchange (FX) costs and risks is key to staying profitable and running smooth operations. Here are some important choices you might want to consider:

Pay in local currency:

Pay your suppliers in their local currency where possible, rather than letting them (or their payment terminal) convert for you and compare what your provider charges to convert versus what you'd pay through DCC or a merchant-side conversion. You're not avoiding the conversion itself, but you're choosing who does it and at what rate, which is often where the real cost difference sits. Paying in their currency can also help you negotiate better deals and keep your costs steady.

Use a multi-currency account:

Use a multi-currency account to hold balances in the currencies you actually transact in, instead of converting every payment back to SGD. If you regularly invoice overseas clients or pay foreign suppliers in the same currency, keeping funds in that currency lets you skip conversion on those specific transactions. You're only converting when you don't already hold what you need, not eliminating conversion altogether.

Pick a card with no FX fees or low conversion fees:

Choose a corporate card that doesn’t hit you with foreign transaction fees or has low conversion fees. This can save you a lot on international purchases and transactions. Look for cards that are made for businesses like yours that deal with international payments often.

Set up forward contracts:

Forward contracts let you lock in exchange rates for future transactions, which protects you from sudden changes in currency values. Some payment providers, like Aspire, offer these contracts to help you manage FX exposure and secure better rates ahead of time.

Keep an eye on exchange rates:

Stay on top of exchange rates and market trends. By watching the rates regularly, you can decide the best times to convert currencies or make payments, helping you save money when the rates are in your favour.

By making these smart decisions, you can keep your FX costs in check and reduce risks, helping your business stay financially strong.

With that in mind, let's explore and compare some of the top corporate card options available in Singapore.

However, don't compare cards on the foreign transaction fee alone. Check the exchange rate/markup, annual fee, rewards conditions, and any other applicable charges.

Comparison of Popular Corporate Cards in Singapore

How the Aspire helps with FX costs

If you're dealing with foreign currencies often, the Aspire Corporate Card is built around cutting FX costs rather than adding to them. There's no foreign transaction fee, instead, you pay a foreign exchange markup of up to 1.5%, and you can lock in FX rates ahead of time for payments you know are coming.

It also supports multi-currency transactions across SGD, USD, EUR, GBP, MYR, PHP, IDR, and VND, so you're not juggling separate cards or accounts for different currencies.

No deposit or minimum balance required. Open your free business account today and have it ready in 1 business day.