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What is a Bureau De Change?

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  • Written By: Jessica Ellis
  • Edited By: Bronwyn Harris
  • Last Modified Date: 22 September 2016
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A bureau de change is a place where one form of currency can be traded for another through a broker. Often called a foreign exchange or currency exchange, this service plays an important part in currency flow between nations. In most regions, it is easy to find a bureau de change near airports,train stations, or other places where travelers may enter a country. Large cities with a high rate of international visitors may have dozens or hundreds of bureaux de change to provide convenience and competitive rates.

Foreign currency exchange is often seen as a necessary part of international travel. When most regions operated off the use of literal value money, such as gold coins, exchanges could be made by weight. The early use of paper and fiat money systems created the need for currency exchanges, so that a traveler could easily convert his homeland money into an acceptable and usable form wherever he went. Many of the first bureaux de change were operated through banks; though many still are, it has also become a large private enterprise.

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It may be difficult to understand how a bureau de change operates as a business, since the function is to simply change one form of money to another. Profit is made in two main ways: by charging commissions or fees, and by adding value to the exchange rate. Commissions are a simpler way to create profit, as they are usually charged as a flat rate for a single exchange. Using the exchange rate, however, may be somewhat complicated, as these rates change daily and even hourly. Usually, a company that charges exchange rate-based fees will buy for slightly less than the published exchange value for the day, and sell for slightly higher than the published rate.

Several factors have made the business of the bureau de change less successful in the 21st century than in years past. First, the massive increase in the use and availability of electronic funds, such as through debit or credit cards, makes the need for foreign cash obsolete in many places. In large cities, it may be no longer necessary to ever carry cash, as everything from restaurants to taxicabs may accept credit cards. Additionally, bureau de change businesses flourished throughout Europe for centuries, since most of the small, proximate countries used their own currency. The implementation of the euro throughout large swaths of Europe has made exchanging currency far less necessary.

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Mor
Post 3

@KoiwiGal - Honestly, that's the worst thing about traveling. You constantly have to worry about being ripped off.

I actually think, in a way, it was better back when you could use traveler's checks because at least they were a bit safer, but hardly anyone accepts them anymore, and even then you're at the mercy of currency exchange rates.

KoiwiGal
Post 2

@umbra21 - That's usually how I'll do it, although sometimes you can find a company that's not going to charge you the Earth whenever you use a debit or credit card (they usually have some other way of collecting fees though).

The only thing I would say is that if you are going to use a money exchange booth in some parts of Europe, you shouldn't use one near the airport and you should definitely check out all the hidden costs before using it.

Don't be afraid to just straight up ask them how much you'll get for a particular amount of currency and walk away if it's more than the next booth over. The money exchange rates can be wildly different from place to place and it's not always obvious from the signs outside the door what they are charging.

umbra21
Post 1

It's a really good idea to try and figure out your money before you step on the plane. I didn't do it before I went on a trip to Europe, figuring I would just use my credit card when I was there, since I decided that having wads of money on me was a bad idea.

Unfortunately, I didn't realize the fee was really huge every time I used the card. Luckily I checked online and figured out what was happening (honestly, it was almost $5 per transaction).

So, what I ended up doing was to try and predict how much money I would need for each place (I wasn't always in the Euro-Zone) and take out that amount

from an ATM when I arrived. Then I would try to spend it before leaving, and handed the change over to a money exchange booth at the end of my trip and got it all converted back to my own currency in one go.

Not ideal, but I think in the long run it was cheaper than using my credit card.

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