Currency Exchange Rates

#Africa bleeds $5B a year not to #corruption or #mismanagement, but just to move money within its own borders. Example: A Kenyan business paying a Ugandan supplier. Instead of Nairobi → Kampala, money goes: Nairobi → USD conversion (1–2%). USD routed via New York/London ($20–50 fee). USD → Ugandan shillings (another 1–2%). By the time a $26,000 invoice is paid, $500–1,000 is gone. Whilst we may be denied visas, our money travels freely through New York. And it’s not just trade: Africa’s #diaspora sends $95B home each year, yet pays the world’s highest remittance costs. -We pay the highest cost for credit. -We pay the highest cost for payments. -We pay the highest cost to send our own money home. It’s not inefficiency. It’s design. The #GlobalFinancialSystem wasn’t built for us. The good news? Solutions exist. #PAPSS (Pan-African Payment and Settlement System) is already live linking 15 central banks, 150 commercial banks, and 14 payment switches, with the capacity to handle $300B in intra-African trade annually. Through PAPSS, that same Kenya–Uganda  transaction could  look very different: -One direct conversion from KES → UGX (0.2–0.5% spread). -Settlement netted via African central banks. -Funds received in hours, not days. Estimated cost: $60–150.  Potential savings: $500–950 on a single $26,000 payment. No detours. Value stays in Africa. The challenge isn’t invention. It’s implementation. One Africa. One market. One #payment system. AI image below*

𝗖𝗹𝗼𝘂𝗱 𝗯𝗶𝗹𝗹𝗶𝗻𝗴 - 𝗧𝗵𝗲 𝗵𝗶𝗱𝗱𝗲𝗻 𝗰𝗼𝘀𝘁 𝗻𝗼 𝗼𝗻𝗲 𝘁𝗮𝗹𝗸𝘀 𝗮𝗯𝗼𝘂𝘁 There’s one silent killer that doesn’t show up in FinOps dashboards: That is - currency conversion costs. Cloud providers bill in their default currency, usually USD, while your business operates in INR, EUR, GBP, or any other local currency. This means every invoice gets converted at the provider’s exchange rate, not yours - and those rates aren’t always in your favor. Imagine a company in India consuming AWS services worth $50,000 per month. AWS bills in USD, but the company pays in INR. Here’s the catch: > AWS uses its own currency conversion rate, which is typically higher than the official exchange rate. > Banks charge foreign transaction fees (1–3% per transaction). > Exchange rates fluctuate, so what you budgeted in INR may not match what you actually pay. Let’s assume: > Official exchange rate: 1 USD = 82 INR > AWS’s applied exchange rate: 1 USD = 83.5 INR > Bank transaction fee: 2% on total amount Actual Cost in INR: > 50,000 x 83.5 = ₹41,75,000 > Bank transaction fee (2% of ₹41,75,000) = ₹83,500 > Total INR paid = ₹42,58,500 That’s ₹1,58,500 ($1,915) lost every month - ₹19,02,000 ($22,980) per year. And this is just one example. Scale this up for global enterprises running multi-million-dollar cloud workloads, and the hidden currency conversion losses could fund an entire FinOps team! Why This Cost Is Often Ignored > It’s not in FinOps dashboards – Most cloud cost tools focus on compute/storage costs, not financial inefficiencies in payments. > It's bundled into "Miscellaneous Fees" – Cloud invoices don’t clearly break down currency markup and bank charges. > It’s assumed as “business as usual” – Most companies treat it as an unavoidable cost, never questioning how to optimize it. The Most Practical Solutions are: ✓ Multi-Currency Cloud Accounts(If available) ✓ Pay via Local Cloud Resellers ✓ Use FinOps to Track Forex Impact ✓ Leverage Corporate Forex Solutions ✓ Prepaid Cloud Commitments in USD For stable workloads, consider pre-loading cloud credits in USD when the exchange rate is favorable. Some enterprises bulk-purchase AWS/Azure/GCP credits when their local currency is strong against USD, locking in savings. So the next time you’re reviewing your cloud bills, don’t just look at how much you’re using - check how you’re paying for it. 𝘋𝘪𝘴𝘤𝘭𝘢𝘪𝘮𝘦𝘳: 𝘛𝘩𝘦 𝘦𝘹𝘢𝘮𝘱𝘭𝘦𝘴 𝘩𝘦𝘳𝘦 𝘢𝘳𝘦 𝘫𝘶𝘴𝘵 𝘧𝘰𝘳 𝘪𝘯𝘧𝘰𝘳𝘮𝘢𝘵𝘪𝘰𝘯𝘢𝘭 𝘱𝘶𝘳𝘱𝘰𝘴𝘦𝘴 - 𝘯𝘰𝘵 𝘢 𝘰𝘯𝘦-𝘴𝘪𝘻𝘦-𝘧𝘪𝘵𝘴-𝘢𝘭𝘭 𝘴𝘰𝘭𝘶𝘵𝘪𝘰𝘯. 𝘈 𝘭𝘰𝘵 𝘮𝘰𝘳𝘦 𝘧𝘢𝘤𝘵𝘰𝘳𝘴 𝘤𝘰𝘮𝘦 𝘪𝘯𝘵𝘰 𝘱𝘭𝘢𝘺, 𝘭𝘪𝘬𝘦 𝘣𝘶𝘴𝘪𝘯𝘦𝘴𝘴 𝘯𝘦𝘦𝘥𝘴, 𝘳𝘦𝘨𝘪𝘰𝘯𝘢𝘭 𝘤𝘰𝘯𝘴𝘵𝘳𝘢𝘪𝘯𝘵𝘴, 𝘢𝘯𝘥 𝘤𝘰𝘮𝘱𝘭𝘪𝘢𝘯𝘤𝘦 𝘳𝘦𝘲𝘶𝘪𝘳𝘦𝘮𝘦𝘯𝘵𝘴. 𝘛𝘩𝘦 𝘳𝘪𝘨𝘩𝘵 𝘢𝘱𝘱𝘳𝘰𝘢𝘤𝘩 𝘥𝘦𝘱𝘦𝘯𝘥𝘴 𝘰𝘯 𝘺𝘰𝘶𝘳 𝘴𝘱𝘦𝘤𝘪𝘧𝘪𝘤 𝘤𝘢𝘴𝘦, 𝘴𝘰 𝘥𝘰𝘯’𝘵 𝘫𝘶𝘴𝘵 𝘵𝘢𝘬𝘦 𝘵𝘩𝘪𝘴 𝘢𝘯𝘥 𝘳𝘶𝘯 - 𝘵𝘩𝘪𝘯𝘬 𝘣𝘦𝘧𝘰𝘳𝘦 𝘺𝘰𝘶 𝘰𝘱𝘵𝘪𝘮𝘪𝘻𝘦. #FinOps

💰 How much $ is wasted on EVERY international payment? I broke down the REAL cost of sending $100K overseas. The numbers matter—but so do the trade-offs. 🏦 Traditional Banking • Wire fees: $40–$90 • FX spread (2–3%): $500–$1,500 • Receiving fees: $10–$20 • Correspondent bank fees (charges and investigations excluded): $50–$200 ➡️ TOTAL: $2,150–$2,450 ⚠️   ⛓️ Blockchain/Stablecoin Alternative: • Network gas fee: $0.05–$10 (varies with network congestion) • FX spread (0.2%): $200 • Platform fee: $0–$400 ➡️ TOTAL: $200–$450 ✅ BUT—and these matters: ❌ Regulatory uncertainty for corporates ❌ Custody and counterparty risk ❌ Conversion back to fiat (often adds 0.5–1%) ❌ Team training and integration overhead   📊 Annual impact for a company making 50 payments: → Traditional: $107,500–$122,500 → Blockchain (best case): $10,000–$22,500 → Blockchain (realistic case with safeguards): $15,000–$35,000 💡 Potential savings: $70,000–$110,000 per year Is your company's pain point cost, speed, or both? That determines which path makes sense. For companies with a minimum of 50+ cross-border payments yearly: It's worth running the math. I built a simple audit framework for this—happy to share. Sam Boboev Nicolas Pinto Victor Yaromin #Fintech #CrossBorderPayments #Blockchain #Stablecoins #TreasuryManagement #DigitalTransformation #RealTimePayments

𝗔𝗳𝗿𝗶𝗰𝗮’𝘀 $𝟭 𝗧𝗥𝗜𝗟𝗟𝗜𝗢𝗡 𝗿𝗲𝗺𝗶𝘁𝘁𝗮𝗻𝗰𝗲 𝗿𝗮𝗰𝗲 𝗶𝘀 𝗵𝗲𝗮𝘁𝗶𝗻𝗴 𝘂𝗽 – 𝗵𝗲𝗿𝗲’𝘀 𝘁𝗵𝗲 𝗳𝗮𝘀𝘁-𝗺𝗼𝘃𝗶𝗻𝗴 𝘀𝗰𝗼𝗿𝗲𝗯𝗼𝗮𝗿𝗱 🔥 ➊ 𝗧𝗵𝗲 𝗵𝗲𝗮𝗱𝗹𝗶𝗻𝗲 𝗼𝗽𝗽𝗼𝗿𝘁𝘂𝗻𝗶𝘁𝘆 Oui Capital’s brand new deep dive pegs Africa’s total (formal + informal) remittance pool at US $329 billion by 2025 — and on a 12 % tear to ≈ US $1 trillion by 2035 ➋ 𝗦𝘁𝗶𝗹𝗹 𝗺𝗼𝗿𝗲 𝗰𝗮𝘀𝗵 𝘁𝗵𝗮𝗻 𝗰𝗹𝗶𝗰𝗸𝘀 (𝗳𝗼𝗿 𝗻𝗼𝘄) Formal flows into Sub-Saharan Africa were US $53-54 billion in 2022, but informals account for 35–75 % of the real volume; a reminder that suitcases of cash and hawala networks remain stubbornly sticky ➌ 𝗠𝗼𝗯𝗶𝗹𝗲 𝗺𝗼𝗻𝗲𝘆 𝗸𝗲𝗲𝗽𝘀 𝗿𝗲𝘄𝗿𝗶𝘁𝗶𝗻𝗴 𝘁𝗵𝗲 𝗽𝗹𝗮𝘆𝗯𝗼𝗼𝗸 • 781 million registered wallets in 2022 (+17 % YoY) processed US $837 billion — 66 % of global mobile-money value • Cross-border transfers over those rails hit US $16 billion, up 22 % YoY, showing diaspora users will switch when UX and pricing line up ➍ 𝗖𝗼𝘀𝘁 𝗴𝗮𝗽 = 𝗱𝗶𝗴𝗶𝘁𝗮𝗹’𝘀 𝗸𝗶𝗹𝗹𝗲𝗿 𝗳𝗲𝗮𝘁𝘂𝗿𝗲 • Average fee to send US $200 into Africa via banks: ≈ 8 % (and over 12 % in many Southern corridors) • Fintech & mobile-money channels now land around 3.5 %, saving migrants US $4-5 billion every year and inching toward the UN SDG target of 3 % ➎ 𝗪𝗵𝗮𝘁’𝘀 𝘀𝘁𝗶𝗹𝗹 𝗯𝗹𝗼𝗰𝗸𝗶𝗻𝗴 𝘁𝗵𝗲 𝗽𝗶𝗽𝗲𝘀? • Only 55 % of African regulators allow full e-KYC, forcing repeat checks and paper trails • Reliance on offshore USD/EUR clearing adds ~US $5 billion in needless FX costs • Fragmented mobile-money networks mean a Kenyan wallet can’t always talk to a Ghanaian one - an API gap crying out for builders. ➏ 𝗧𝗵𝗲 𝗽𝗿𝗶𝘇𝗲 𝗳𝗼𝗿 𝗳𝗶𝘅𝗶𝗻𝗴 𝗶𝘁 PAPSS and other real-time, local-currency rails could claw back that US $5 billion in correspondent-bank fees - and every 1 % drop in remittance costs frees up ≈ US $6 billion a year for African households Big question: 𝘾𝙖𝙣 𝙢𝙤𝙗𝙞𝙡𝙚 𝙬𝙖𝙡𝙡𝙚𝙩𝙨, 𝙋𝘼𝙋𝙎𝙎, 𝙖𝙣𝙙 𝙚𝙢𝙚𝙧𝙜𝙞𝙣𝙜 𝙨𝙩𝙖𝙗𝙡𝙚-𝙘𝙤𝙞𝙣 𝙘𝙤𝙧𝙧𝙞𝙙𝙤𝙧𝙨 𝙥𝙪𝙡𝙡 𝙩𝙝𝙚 𝙞𝙣𝙛𝙤𝙧𝙢𝙖𝙡 𝙛𝙡𝙤𝙬𝙨 𝙞𝙣𝙩𝙤 𝙩𝙝𝙚 𝙡𝙞𝙜𝙝𝙩 𝙗𝙚𝙛𝙤𝙧𝙚 𝙡𝙚𝙜𝙖𝙘𝙮 𝙛𝙚𝙚𝙨 𝙚𝙭𝙝𝙖𝙪𝙨𝙩 𝙢𝙞𝙜𝙧𝙖𝙣𝙩 𝙬𝙖𝙡𝙡𝙚𝙩𝙨? 🔗 Full analysis in Oui Capital’s “Africa’s Cross-Border Payment Landscape” report. Highly recommended reading for anyone building or investing in the rails of tomorrow. Thoughts? Drop them below ⬇️ Oui Capital Joseph Cleetus Dmitri Navaratnam Amar Sinha #crossborderpayments #remittances #payments #wallets #distuptions

 India is actively expanding its Free Trade Agreements (#FTAs) with key global #economies, including the #UAE, #Australia, #Japan, #South #Korea, the European Union, and the #UK. While these agreements aim to enhance bilateral trade volumes, realising their full potential hinges critically on integrating Central Bank Digital Currency (#CBDC) corridors. To maximise trade efficiency, India's FTAs should explicitly include a condition that mandates #transitioning #trade settlements to #CBDC channels, with fintech companies ideally managing these transitions to ensure #swift, #scalable, and cost-effective implementation. One of the most significant barriers currently affecting international trade efficiency is the high conversion cost incurred when transactions involve multiple #currencies. Typically, multi-currency trade—for instance, converting the Indian Rupee to the US Dollar and then to the UAE Dirham—incurs costs ranging from 3.7 percent to 8 percent of the transaction value. These costs result from multiple foreign exchange spreads, intermediary correspondent bank charges, and regulatory margins. CBDC-enabled corridors, which allow direct settlements between central banks in digital currencies, eliminate these intermediary costs, drastically reducing conversion expenses to approximately 0.1-0.2 percent. This reduction equates to substantial potential savings of 3-8 per cent per transaction. The evolving India-UAE trade relationship provides a clear illustration. Historically, India primarily conducted its oil trade with the UAE in US dollars until the onset of Russia's invasion of Ukraine in February 2022 and the subsequent exclusion of Russian banks from the SWIFT system in March 2022. The disruption led India and the UAE to rapidly transition away from dollar-based settlements, culminating in a July 2023 agreement to facilitate trade directly in Rupees and Dirhams. On August 14, 2023, India conducted its first oil transaction with the UAE in rupees. By August 2024, the Reserve Bank of India was actively encouraging banks to prioritise direct Rupee-Dirham settlements. Yet, despite bypassing the dollar, structural complexities still impose transaction costs between 3.7% and 8%. Establishing a CBDC-based corridor, ideally managed by fintech platforms, can further reduce these costs, saving India between $3.1 billion and $6.7 billion annually on its approximately $84 billion in bilateral trade with the UAE. These savings are particularly valuable in oil, petrochemicals, and fertilizer feedstock trades, which can be passed on to the consumers in India.  

🌍 Understanding the FX Trade Life Cycle   Foreign Exchange (FX) is the largest financial market in the world — moving more than $7.5 trillion every day.   🔄 The FX Trade Life Cycle 1️⃣ Pre-Trade: Price Discovery Before anything is traded, several inputs shape the quote: Spot rate flows Interest rate differentials Market liquidity Economic releases Client credit limits Algo pricing engines Example: A corporate client wants to buy USD/JPY. Sales checks liquidity → Trader or pricing engine offers a quote.   2️⃣ Trade Execution FX trades can be executed in multiple ways: Chat/Voice trading (corporates, private banks) E-trading platforms (FXall, 360T, Bloomberg FXGO) Internal pricing engines for auto-hedging Prime brokerage for leveraged clients Execution must capture: ✔ currency pair ✔ notional ✔ buy/sell ✔ settlement date (Spot / Forward / NDF) ✔ trade time   3️⃣ Trade Capture & Booking Once executed, the trade is automatically or manually booked into FO systems: Murex Calypso Bloomberg Proprietary bank pricing engines Any misbooking in: currency pair, rate, or settlement date can ripple into: ⚠ Wrong P&L ⚠ Incorrect risk exposures ⚠ Settlement failures   4️⃣ Trade Confirmation Back Office sends details to the counterparty to confirm: Notional Buy/Sell direction Rate Settlement date Currency pairs Counterparty details FX confirmations are exchanged via: ✔ SWIFT MT300 (most common) ✔ FXall matching ✔ Traiana / DTCC for electronic matching Breaks → investigation → resolution before settlement.   5️⃣ Risk Management & Valuation FX positions create several types of risk: Market risk Settlement risk Counterparty credit risk Liquidity risk Daily processes include: ✔ Revaluation (MTM) ✔ P&L explain ✔ Sensitivity checks ✔ Stress testing FX traders run continuously hedged books, so risk systems recalc all day.   6️⃣ Settlement Preparation (Critical for FX) FX settlement is unique because two currencies move simultaneously. Settlement flows depend on trade type: Spot (T+2) – most FX Forwards – customized settlement NDFs – cash-settled Options – premium + exercise settlement Operations verifies: ✔ Nostro cash balances ✔ SWIFT instructions ✔ CLS eligibility (for major currencies)   7️⃣ Settlement: Cash vs Cash Movement FX is primarily cash settled, not security settled. Two legs move: Example: For USD/JPY, bank delivers USD and receives JPY.   8️⃣ Post-Trade Lifecycle Events FX trades may require additional processing: Rollover of forwards Updating interest differentials Exercising FX options Collateral margin calls (for derivatives) Regulatory reporting (MiFID, EMIR, Dodd-Frank) This is where Ops, Risk, Treasury, and Finance all connect.   9️⃣ Trade Close or Rollover A trade ends when: Settlement is completed Forward contract matures Option expires or is exercised Position is rolled into a new date   #Finance #FXTrading #TradeLifecycle #SalesAndTrading #InvestmentBanking #GlobalMarkets #Derivatives #FinTech #Operations #LinkedInLearning

I still hear people saying “crypto is a solution looking for a problem” So consider this: Normally sending $1000 from the US via banks will land you with ~$955 worth of ZAR in South Africa With crypto, sending $1000 will land you with ~$1034 worth of ZAR in SA Let me explain: Yesterday a friend in South Africa needed to receive money from his nephew in the US. So I walked him through how he could do it with crypto using Coinbase and VALR. His nephew opened an account with Coinbase and funded his account with USD for free. He then could buy USDC (a stablecoin) on Coinbase with no fees. With USDC in hand he has several options to send the funds. I suggested using Avalanche C-Chain as it’s cheap and VALR supports it too. The entire transaction would cost $0.06 to send *any amount* between Coinbase and VALR. I helped my friend get his USDC wallet address on Avalanche C-Chain on @VALRdotcom (he had already opened a free account on VALR): 1) Go to wallets page on VALR and select USDC 2) Click on Deposit 3) Select Avalanche C-Chain network 4) Generate the address and send to nephew His nephew could then send the USDC to VALR for $0.06 very quickly and with no volatility. On VALR my friend could then sell the USDC for ZAR at a much more favourable rate than any bank can offer: 19.04 rands per dollar on VALR vs 18.37 in FX markets. And if you consider the best published spread at the bank (68 cents) vs VALR (1 cent), you end up with a difference in exchange rates of 18.09 (bank) vs 19.03 (VALR) or 19.00 to account for liquidity & 0.1% exchange fee - a 5% difference if you can’t get a better bank rate. N.B. The difference in rates is driven by exchange control regulations (capital controls) in South Africa where there is always a shortage of crypto available in the SA market. Traders would love to arbitrage this difference down to zero, but regulations don’t permit them to. So: BANK: $1,000 - $30 SWIFT fee = $970 x 18.09 (bank rate) = R17,547 landed / 18.37 (Google FX rate) = $955 worth of ZAR CRYPTO: $1000 (in USDC) - $0.06 (Avalanche C-Chain fee) = $999.94 x 19.00 (VALR rate) = R18,998 landed / 18.37 (Google FX rate) = $1,034 worth of ZAR Important to note that VALR offers 30 free withdrawals per month (essentially 1 free withdrawal per day) to get ZAR into any bank account in South Africa so landed means landed in any account. Yes, this is new and takes some getting used to (and the user experience will get much better with time), but in summary… …my friend could get 8% more in value by using crypto to receive the money from his nephew in the US. And that’s a beautiful thing to behold!

I recently contributed as the expert advisor to the International Monetary Fund’s Chapter 2 on “Risk and Resilience in the Global Foreign Exchange Market” co-authored by Yuhua Cai, Andrea Deghi (co-team lead), Seungduck Lee, Taneli Mäkinen, Yuan Tian, Tomohiro Tsuruga (co–team lead), and Mustafa Yasin Yenice, under the supervision of Mahvash Qureshi and Mario Catalán.   This excellent study examines how rising macrofinancial uncertainty and structural shifts are reshaping the foreign exchange (FX) market, a cornerstone of the international monetary and financial system.   A few of the chapter’s main insights: - Episodes of macro-financial stress can trigger flight-to-quality flows, raise funding costs, deteriorate market liquidity, and increase FX volatility; pressures are strongest in emerging markets, especially for currencies with large NBFI activity, concentrated dealer bases, and heavy hedging demand. - FX market disruptions often spill into other assets, tightening financial conditions and creating risks for macro-financial stability, particularly in economies with currency mismatches and fiscal fragility. - After the US tariff announcements in April 2025, some investors cut US dollar exposure, while others held positions and boosted hedging, adding to downward pressure on the dollar. The chapter’s findings have relevant implications for the work of both policymakers and academics in the field. For instance, some of the policy recommendations included in the report are to: - Strengthen FX market resilience through enhanced systemic risk monitoring, stress testing, and better data transparency, particularly on NBFIs and bilateral exposures. - Bolster liquidity and safety nets by maintaining strong capital buffers, ensuring access to central bank liquidity, and expanding swap lines and international reserves. - Modernize market infrastructure by improving cyber resilience, contingency planning, and reducing settlement risk via payment-versus-payment systems and digital interoperability innovations. I’m grateful to have had the opportunity to contribute to this project - special thanks to the authors and to Tobias Adrian for the insightful discussions!   #GFSR #IMF 

It feels a special privilege when you get quoted by the news organisation where you worked once as a journalist. Rupee depreciation has opened up some interesting opportunities for the NRIs. My quote below: Ritu Kant Ojha, a Dubai-based real estate strategist advising HNIs on portfolio diversification, said a weaker rupee increases the purchasing power of overseas earnings in India. “When the rupee depreciates, Indian assets become relatively cheaper in foreign currency terms,” Ojha said. He added that this has encouraged some NRIs to reassess the timing of remittances and advance transfers to lock in exchange-rate advantages.According to Ojha, households receiving remittances are directing the additional rupee value toward loan prepayments and asset purchases rather than consumption. “The exchange-rate benefit is often used to reduce debt or fund property investments, helping households strengthen their balance sheets,” he said. Global economic agencies have projected continued uncertainty and slower growth through 2026, a backdrop that analysts say could sustain currency volatility. Advisers across education and wealth management say this environment is prompting families to factor exchange-rate risk more prominently into financial decisions. https://lnkd.in/euC_Jpw3 Anshul Majumdar CNBC-TV18

$9.6 Trillion Traded Daily - The Global FX Market Just Hit a New Record 📈 The latest Bank for International Settlements – BIS Triennial Survey, the world’s most comprehensive snapshot of global FX and OTC derivatives activity, reveals how global trading has evolved since 2022.   Key Highlights: • $9.6 trillion traded daily in global OTC FX markets, up 28% from 2022. • FX swaps remain the largest instrument, hitting $4.0 trillion daily average turnover, although spot and forwards grew faster. • The US dollar still dominates, present in 89.2% of all FX trades. • Four financial centres, the UK, US, Singapore, and Hong Kong, account for three-quarters of all global FX activity. • London retains its position as the world’s largest FX trading hub. These figures underscore both the scale and resilience of global FX markets and remind us how central liquidity, infrastructure, and geography remain in shaping modern market dynamics.   📊 Source: BIS Triennial Central Bank Survey (Preliminary Results, 2025)   #BIS #FX #GlobalMarkets #Derivatives #MarketStructure #Finance #Trading #Economy