Currency Conversion is the ability of any individual, corporate or Government to exchange local currencies to another without Bank or Government intervention. It takes different forms it may be fully convertible, partly or non convertible. In the first case there is no such limitation of amount to be exchanged in International market, US dollar being an example one of the prominent currencies traded by Forex market. The 2nd Category Central Bank has a control & currencies nonexistent in Forex markets are barred from conversion.
Exchange rates are of two types one is spot rate same as the current market rate another is the forward rate where supply of goods to take place later. In case of Currency Conversion the quote different buying & selling rates. This rate provides allowance for dealers’ margin. Different rates may be there for notes, travelers’ check or credit cards. For the convenience of travelers authorized dealers cater in the Air Ports or the ATM there can be availed too. The most branded credit cards offer quite favorable rates. In every country Government mechanisms manage value (currency) & keep it competitive in world money market. The fluctuation of any currency depends on the business volume, employment level & importantly the GDP rate.
Today Currency Conversion have become enormously convenient due to availability of online information including conversion calculator or currency converter, so he becomes sure exactly how much to get in exchange on that particular day. In modern day worldwide Visa, Master, American Express & Diners cards are readily acceptable with favorable exchange rates. Travelers benefit hugely in this regard. Generally bank charges are included in the exchange rates, normally it is 2-3% of the purchase made or service availed. Apart from International Trade Currency Conversion is often necessary for travelers, executives operating cross borders, students, individuals & corporate etc. It is of a great friendly advice that due to lack of document no one should avail the service of illegal exchangers.
As European market found to be steady last week Euro Dollar is naming the terms, this was just for example. But fluctuation in stock markets instantly affects exchange rate..So when enormous exports are concerned the concern should be aware of the current Stock market trends. When a currency is converted, the seller country also earns revenue too. Countries try to attract tourist of developed countries (from G 10-Leading Countries considering international value of their currency) because apart from business reason, lot of amount of money is exchanged. So individuals & organizations should opt for legitimate conversion.