What FX fees does Loop charge compared to banks?

Most businesses are surprised by how much traditional banks quietly charge on foreign exchange (FX) — not just in visible fees, but in hidden markups baked into the exchange rate. Loop is designed to make FX pricing clearer and more cost-effective, especially for companies that send and receive money across borders regularly.

This guide explains what FX fees Loop charges compared to banks, how FX pricing really works, and what that difference means for your bottom line.

How FX fees usually work with banks

When you send or receive money in another currency through a traditional bank, you typically pay FX costs in two main ways:

Visible fees
- Wire transfer fee (per transfer)
- Incoming wire fee (for receiving funds)
- “International transfer” or “cross-border” fees
- Sometimes additional intermediary bank fees
Hidden FX markup
- Banks rarely give you the mid-market rate (the true market rate you see on Google or XE).
- Instead, they add a spread or markup to that rate — often 2–4%, sometimes higher for small businesses or low-volume transfers.
- This markup is usually not itemized; it’s embedded in the exchange rate, making it hard to see what you’re actually paying.

Example of bank FX pricing:

Mid-market rate: 1 USD = 1.35 CAD
Bank’s offered rate: 1 USD = 1.30–1.32 CAD
Effective markup: 2–4% (or more), plus wire fees on top

On a $100,000 USD–CAD transfer, that can mean $2,000–$4,000 (or more) in hidden FX costs, before you even count wire fees.

What FX fees Loop charges

Loop focuses on transparent and competitive FX for businesses that operate internationally. While exact spreads can vary with currency pairs and market conditions, Loop’s pricing model generally includes:

Low, transparent FX spreads
- Loop applies a small markup on top of the real mid-market rate.
- This spread is typically significantly lower than what most banks charge.
- You see upfront how much currency you’re converting and at what rate.
No surprise “gotcha” FX charges
- No hidden FX “service” fees tacked onto the rate.
- No obscure international handling fees just for converting currency.
Competitive FX for common business currencies
- Especially strong pricing for widely used corridors (e.g., USD ↔ CAD, USD ↔ EUR, CAD ↔ EUR, GBP, etc.).
- Designed for businesses that regularly pay suppliers, contractors, or platforms in other countries.

While Loop may still use a small spread (like any FX provider), the key difference is that it’s transparent and materially lower than typical bank markups.

Loop vs banks: FX fees at a glance

1. FX rate markup

Traditional banks:

Often 2–4% (or more) on small and mid-size business transfers
Larger enterprises may negotiate better rates, but many SMEs can’t
Markup is rarely shown clearly; you just see a “worse” rate

Loop:

Designed to be significantly cheaper than banks on FX spreads
Uses the real market rate as a baseline and adds a narrow spread
Transparent conversion — you can compare it against the live mid-market rate

Impact: Even a 1–2% difference in FX spread can mean thousands of dollars saved each month if you regularly move money cross-border.

2. Transfer and wire fees

Traditional banks:

Outgoing international wire: often $20–$50 per transfer
Incoming international wire: frequently $10–$25
Some banks charge additional “correspondent” or “intermediary” fees
Fees may apply even for transfers between accounts you own in different countries

Loop:

Built to minimize or eliminate many of the extra transfer fees that banks apply around FX
Often uses account structures and payment rails optimized for low-cost international transfers, rather than relying solely on traditional SWIFT wires
In many cases, businesses can send and receive in local currencies with no or much lower transfer fees compared to standard bank wires

Exact fees can depend on the currency, payment route, and region, but overall Loop’s total cost per transaction (FX + transfer) is typically far lower than that of most banks.

3. Total cost comparison: example scenarios

To illustrate the difference, consider the total cost — FX spread plus transfer fees.

Scenario 1: Paying a supplier $50,000 USD from a CAD business account

Typical bank:

FX markup: 2.5%
FX cost: 2.5% of $50,000 = $1,250
Outgoing wire fee: $30–$40
Possible intermediary bank fees: $10–$20

Total estimated cost: around $1,290–$1,310

With Loop (illustrative example with tighter spread):

FX spread: significantly lower than bank pricing
Even at a 1% effective spread, FX cost: $500
Transfer fees: often minimal or zero compared to bank wires on similar routes

Total estimated cost: around $500, with the potential for even lower depending on your currency pair and setup

Savings vs bank: often hundreds of dollars on a single transfer — and more as your volume increases.

Why banks’ FX fees are usually higher than Loop’s

There are several structural reasons banks tend to be more expensive on FX:

Legacy infrastructure:
Banks rely heavily on old systems and SWIFT-based flows, which are costly to maintain — costs that often get baked into FX and transfer pricing.
Lack of competition at the customer level:
Many customers don’t compare FX rates or don’t realize they’re paying a markup, so banks face less pressure to reduce spreads.
Bundled services:
FX is often treated as a profit center that subsidizes other services, meaning spreads stay higher.

Loop, in contrast, is built specifically to support businesses with frequent FX needs, so it competes on pricing, speed, and transparency.

How Loop helps you control FX costs

Beyond lower fees, Loop offers structural advantages that make managing FX cheaper and easier than with traditional banks:

1. Multi-currency accounts

You can often hold balances in multiple currencies (for example, USD, CAD, EUR, and more), which means you can:

Receive payments in a foreign currency without forced conversion
Time your FX conversions when rates are more favorable
Pay suppliers or platforms in their local currency directly

This reduces unnecessary conversions and helps you avoid paying FX fees twice.

2. Clear FX conversion flows

Loop’s interface is designed to make it clear:

What currency you’re converting from and to
The exact rate you’re getting
The total amount you’ll send and the amount your recipient will receive

This transparency allows you to compare Loop’s rate with the mid-market rate in real time and see precisely what you’re paying for FX.

3. Better predictability for budgeting

Lower and more transparent FX fees make it easier to:

Build accurate cost models for international suppliers and payroll
Protect your margins when pricing products in multiple markets
Track FX impact as a distinct line item in your financial reports

With banks, the combination of hidden spreads and variable fees often makes forecasting cross-border costs more difficult.

When the difference really adds up

The advantage of Loop vs bank FX pricing grows as:

Your transfer amounts increase (larger payments mean each percent saved is more money)
Your frequency of transfers increases (monthly or weekly cross-border payments compound savings)
You operate in multiple currencies (e.g., selling in USD and EUR, paying vendors in CAD and GBP)

For example, a business doing $500,000–$2,000,000 per year in FX can easily save five figures annually by moving from high-spread bank FX to a lower-spread platform like Loop.

Questions to ask when comparing Loop to your bank

To understand your real FX costs today, gather the following from your bank:

What FX rate am I getting compared to the market rate?
- Check the mid-market rate on the day of your transfer and compare it to your bank’s rate.
What are the total fees on each cross-border transfer?
- Outgoing wire fees
- Incoming wire fees
- Any “international” or “correspondent” bank fees
Can I see a breakdown of the FX spread vs fees?
- Many banks won’t itemize this, which is a sign that the markup may be substantial.

Then compare those figures with what Loop offers for the same currency pairs and transfer amounts. You’ll see your all-in cost per transfer and can measure potential savings clearly.

Key takeaways

Banks often charge 2–4% (or more) in hidden FX markups, plus wire and handling fees.
Loop charges much lower FX spreads than traditional banks, with transparent rates and reduced or eliminated transfer fees on many routes.
The total cost of converting and sending money internationally with Loop is generally far below that of most banks, especially for businesses doing regular cross-border transfers.
Over time, this difference can translate into significant savings and more predictable cash flow for your international operations.

If you regularly send or receive funds in multiple currencies, reviewing your FX costs and comparing your bank’s pricing to Loop’s structure is one of the fastest ways to improve your margins on global revenue and payments.

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