Thursday, October 20, 2016

3 Types of Travelers who deal with Foreign Exchange

When travelers go out of the country, after preparing their flight tickets, accommodation and visa, what comes next in question is the preparation for money.  Here comes the questions on like where to buy third currency or if is it good to have USD instead?

Preparation for Money

Type 1: Traveler who wants to have 3rd currency prior to landing

In Manila, you can get 3rd currency (i.e. JYP, KRW, HKD) from major banks and money changer (i.e. Czarina or Sanry's).

You need to find the rates under Selling column (which means the bank will sell their 3rd currency to you).
For example, if you need 500,000krw in hand, then you have to pay:
BDO (at 0.0429 rate) = 21450php
BPI (at 0.05 rate) = 25000php

Process for BDO:
1. You need to have an account at a Mall BDO branch 
2. Call the branch to post the request for reservation (it will be ready by 3-5 days, upon availability as they still need to verify with their main branch)
3. Call again on the agreed date to make sure that it is ready prior to your visit
4. Upon confirmation on the phone, prepare a copy of your flight ticket, passport, account number (should be on the same branch), TIN number, cash (or credit from your account)


Type 2: Traveler who wants to carry USD instead

Some say if you pass by USD, you will be double charged by the applicable tax charges.
BDO (at 48.1500 rate), you pay 21450php to get 445.482 USD

For example that you went to IBK to buy KRW upon arrival,
IBK (at 1,106.59 rate ), 445.482 will be 492,965.9263 KrW which is lower value compared to "Type 1" traveler.

That still depends on the rates on the airport exchange banks (i.e. Incheon Airport) which normally have low rates.

For Seoul, you can exchange few bucks in the airport for your transportation  to the city.  In the city, you can exchange in banks, malls, or convenience stores (specifically 7/11 in Myeongdong has good rates).  


For Japan, we normally transact in banks, they would need your passport as well. 


Type 3: Traveler who prefers cash less transaction
Make sure that your ATM or credit card has been activated to be used on international transaction, call your bank to activate this service.  (Same goes for those who are using credit card transactions, you  need to notify them about your travel advisory prior to your flight.  Otherwise, your transaction may not go through or be tag as fraud).

Upon your arrival, you can just go to a partner ATM machine, and your PhP money will be automatically converted to local currency (i.e. KrW), ready for your withdrawal.



I personally started as Type 2, then I'm moving to be Type 1.  However, I have read this comment in Trip Advisor, "I don't understand the concept that people buy a currency for a country before they arrive? Are you worried they won't have any more when you land?" [Read further]

For me, I guess it is more of paranoia or just being ready that I have money to spend in that point in time.  I don't want to use credit card because HSBC rates are just too high when converting the charges.  If in case I'm too hungry upon arrival, I still have to line up for the money changer before buying the food.  Or if my flight was delayed and I need to catch the last train heading to the city, instead of having an instant cash to buy the ticket, I still have to line up for the money changer or ATM machine.  

It will all depend on what type of traveler you are when it comes to preparation upon arrival or spending money or if you have enough time to spend at the airport to do the queues.  

Anyway, just enjoy the moment and seize the situation you'll be up to. 

Read more discussion on Trip Advisor Threads:
Exchange Rate in Incheon  



What to do with your left over money?
  • Make sure to spend your remaining coins in buying snacks at the airport or when playing with the telephone booth.  Money changers on your home country normally do not accept coins.
  • With your bills, you can opt to change it to your local currency at the airport before your departure.  Not all 3rd currency are accepted in the banks of the Philippines (BDO Mall money changer did not accept Malaysian ringgit and Indonesian rupiah last March 2016), so make sure to check first.
  • Sell your bills on other travelers you can find from forums like Pinoyexchange.
  • Add few of the bills to your collector's item. 
  • Keep it, save it, you'll never know when you will be back to that same country, but next time head out to the provinces (especially for  won in Korea as there are other destinations like Busan and Jeju apart from Seoul, and yen for Japan as there are other airports like in Osaka, Nagoya, Fukuoka apart from Tokyo).

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