It's just a quick trip to your PC for foreign currency solutions.
You don't need to leave home to explore the buying power of the rand overseas or have foreign currencies translated into their local equivalent. Just head for your closest computer, because the internet will do currency conversions for you, supply you with exchange rates going back a decade or two, work out a graph that compares exchange rates and even help you order foreign currency.
In the past, when you wanted to know if your budget could cope with a holiday in, for example, London, you'd need to look up the conversion rate from rands to British pounds on exchange rate tables, such as those on page 90 of this magazine, and do your own calculations. Now, you can use one of the many online currency calculators. You will find them on the websites of local banks and foreign exchange dealers.
On First National Bank's website ( www.fnb.co.za), for example, you will find a foreign exchange calculator. Follow the "Personal", "Services", "Forex services", "Exchange rates" and "Calculator" links. You can work out how many rands you need to buy a set amount of any one of 20 different currencies, or, conversely, how much of any one of these currencies a set amount of rands will buy. You can also work out what the bank will pay you if you have foreign currency to sell.
Jacques Celliers, of FNB's International Banking division, warns, however, that you should regard the figures generated by the calculators only as an indication of what it will cost you to buy, or earn you when you sell, foreign currency.
Celliers suggest you always consider the total cost rather than just the exchange rates. You should include all charges, commissions and so on, before you choose a foreign currency provider. The reason, he says, is that although a certain provider could give you a good rate on a specific transaction on a specific day, it might be charging you higher transaction charges and commissions than another provider, and these charges may not be included in the quoted rate. A comparison of the total costs may be different.
Banks providing foreign currency usually have different rates for different clients, and also for every kind of foreign currency transaction, such as buying notes or traveller's cheques, or transferring money using the Swift system or a draft, Celliers says. The rates also differ depending on the amount. FNB's calculator quotes rates for amounts up to R50 000.
Also, remember to include VAT when you compare quotes, Celliers says, as some providers quote charges excluding VAT and others include VAT.
The FNB website also allows you to look up exchange rates going back to October 2001. After "Exchange rates", follow the "Historical" link and select the date and currency you want.
Standard Bank's website ( www.standard.co.za) lists the foreign exchange closing rates of the previous working day for the different transactions on amounts up to R160 000 - the travel allowance allowed per person. There are about 30 currency rates on this site and you can look up the closing rates for any day over the past two years. To get to the appropriate webpage on the Standard Bank site, you need to follow the "Foreign exchange" link under "Services" and then click on "Exchange rates".
If you are looking for a currency that is not listed on either FNB's or Standard Bank's website because it is not one of the 20 used most frequently by South Africans, you can get a rough idea of the exchange rate by looking at currency convertors on foreign websites. But you should remember that many of these sites quote interbank rates, which are about two percentage points lower than the rate you would get if you bought from a local dealer. These rates also do not take into account the form of currency required, the amount involved or your relationship with your bank.
Type in "currency convertor" on any good search engine and page after page of these calculators will be listed. The currency convertor on the Yahoo site ( www.finance.yahoo.com/currency) has a fairly extensive list of currencies, and you can convert from any one of them to any other.
If you need historical rates of a wider range of currencies, try the x-rates.com site ( www.x-rates.com), which offers you the exchange rates of 42 different currencies going back to 1990. You can request a graph of the exchange rates of your chosen currencies for any year going back as far as 1990, or a graph comparing the average exchange rates of your chosen currencies over the past month.
Unfortunately, the site does not include all currencies. A note on the site states that if exchange rate information for the currency of a particular country is not easily obtainable on the internet copyright-free from a reliable source, then you may not find it.
Oanda.com, a currency trading and information website, also offers historical exchange rate information ( www.oanda.com/convert/fxhistory). The site can generate a table with daily exchange rate averages on interbank rates or typical credit card or cash rates. However, the site appears to give historical information only as far back as 1998.
If you are looking for historical exchange rates for the purposes of recording the value of an asset or an investment for tax purposes, visit the website of the South African Revenue Service ( www.sars.gov.za). Follow the "Ecommerce" link from the top navigation bar. Then choose the "Rates of Exchange" link, which gives you the option of choosing single or multiple values, depending on whether you want the exchange rate on a single date or all the rates between two dates.
If you are in the market to buy foreign currency, depending on your requirements, you may be able to place an order on the websites of certain local foreign exchange dealers. For example, on the Rennies website ( www.rennies.co.za) you can order any one of 20 foreign currencies in cash or traveller's cheques and the money or cheques will be sent to your nearest Rennies branch. The calculator that forms part of the ordering process converts the amount of currency you want into rands. This gives you an indication of what you will pay, but not the final amount. That can be confirmed only when you pay and depends on the exchange rate at that time.
Currently, only if you are an FNB internet banking customer can you buy foreign currency online using live foreign exchange prices at any time of the day or week and pay for it, at that rate, from your bank account. If you live in a major metropolitan area, you can have the foreign currency delivered to your place of work during office hours, or you can collect it from your nearest branch. You can carry out the transaction online up to 60 days ahead of your date of travel.
You can access this service by logging on to the FNB site ( www.fnb.co.za), selecting "Features" and then "Buy Forex". If you are registered with eBucks.com, you will earn eBucks at the rate of 0.2 percent of the rand value of the transaction for all traveller's cheque transactions over R5 000.
You may buy forex for family members or friends travelling with you, providing you give their full details, including their identity numbers and residential addresses. When you collect your foreign currency or have it delivered, you will have to show your passport and your ticket.
Standard Bank has introduced a prepaid foreign exchange travel card known as TravelWallet.
You "load" the card by buying euros, British pounds or United States dollars ahead of your trip. The beauty of TravelWallet - as is the case when buying traveller's cheques - is that you know what you are paying upfront. Then, while you are abroad, you can use the card to draw cash at ATMs displaying the MasterCard or Cirrus signs. Alternatively, you can use the wallet as a debit card to pay for goods and services in any country you are visiting. This means that you do not need to rely on the business hours of bureaux de change.
Unfortunately, you cannot yet apply for the card online, but you can keep track of your transactions and card balance by logging on to www.mastercarddebit.com/prepaid/standardbank/travelwallet
This article was first published in Personal Finance magazine, 4th Quarter 2004. See what's in our latest issue