Foreign Exchange

ForeignExchangeFee

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The FXF is a 2% fee that will be charged on purchases of foreign currency and payments related to foreign currency transactions. The FXF will apply to purchases and payments made at

  • Commercial banks and other authorised foreign exchange dealers – Citicorp Merchant Bank Ltd., Consolidated Finance, Globe Finance Co. Ltd., and Signia Financial Group Inc.
  • Credit card providers, including Cave Shepherd
  • Money service providers that handle outbound foreign currency transactions or loans, e.g. Western Union


This means that if you buy foreign cash, pay for a wire transfer or bank draft, or use your credit, debit, or travel card to pay for a foreign transaction, you will have to pay the FXF.

The FXF applies to purchases and payments only, so when you convert foreign cash to local money, deposit a foreign bank draft, or receive a wire transfer, you will not have to pay the FXF.

The FXF is intended to reduce the demand for foreign exchange and in so doing stabilise the island’s foreign reserves and protect the value of the Barbados dollar as well as to generate revenue for the Government and help reduce the fiscal deficit.

The FXF is 2%. That 2% will be calculated on the Barbadian value of the foreign currency being purchased or paid for.

So, as an example, if you were to buy US $500.00 in cash at a rate of 2.02857, you would now pay $1,034.58 instead of $1,014.29 as shown below.

 

 

 

US Value

Exchange Rate

BBD Value

FEF (2%)

Total Payment

$500.00

2.02857

$1,014.29

$20.29

$1,034.58

 

 

Your transaction receipt will show the FXF separately, so you will know how much of what you pay is the FXF.

 

 

The FXF on purchases of foreign cash, wire transfers and bank drafts will go into effect on Monday, July 17, 2017.

Credit, debit and travel cards will become subject to the FXF on Friday, September 1, 2017. After that date, if you use any of those cards to make a foreign currency purchase, you will have to pay the FXF.

 

If you are buying foreign cash, paying for a wire transfer or bank draft, or making a foreign currency payment using your credit, debit or travel card, you will have to pay the FXF.

If someone sends you a foreign wire transfer or bank draft or if you are converting foreign currency to Barbadian money or depositing foreign money onto your account, you will not have to pay the FXF.

In addition, if you have a foreign currency account and you are making a payment from that account, you will not have to pay the FXF.

Entities in the International Business and Financial Services (IBFS) Sector making payments from foreign currency accounts are also exempt from the FXF.

Yes. If you buy foreign currency from a bank, you will have to pay the FXF. The fee will be calculated based on the Barbados value, and when you receive your receipt, it will show how much of what you paid was the FXF.

If you are using your foreign currency account to make a payment or purchase, you will not have to pay the FXF.

In addition, entities in the International Business and Financial Services (IBFS) Sector making payments from foreign currency accounts are also exempt from the FXF.

There are also certain transactions by authorised foreign exchange dealers and on behalf of the Government of Barbados and statutory bodies that are exempt from the FXF.

Read the full list of exemptions here.

The FXF applies to purchases of foreign currency and payments related to foreign currency transactions. This means that if you buy foreign cash, pay for a wire transfer or a bank draft, or use your credit card (including Cave Shepherd cards), debit cards, or travel cards to pay for a foreign transaction, you will have to pay the FXF.

The FXF applies to purchases and payments only, so if, for example, you returned from vacation with leftover foreign cash and sold it back to the bank, you would not have to pay the FXF. Similarly, if a relative overseas sent you a wire transfer or a bank draft and you deposited it, you would not have to pay the FXF.

Yes. If you pay for a wire transfer or buy a bank draft, you will have to pay the FXF. The fee will be calculated based on the Barbados value, and when you receive your receipt, it will show how much of what you paid was the FXF.

Yes. Anytime you use your personal or business credit card while you are overseas or to make an online purchase from a company outside Barbados, e.g. Amazon or eBay, you will have to pay the FXF.

The FXF will be calculated based on the Barbados value and that Barbados value will be calculated using the exchange rate on the date your bank posted the transaction. As a result, the exchange rate on the date you pay your credit card bill will not affect how much you pay for the FXF.


Below is an example of credit card statement showing the posting date for each transaction:

N.B. Even if you opt to be charged in Barbados dollars when you purchase an item with your credit card, you will still have to pay the FXF. This is because even with this option, your bank must still use foreign currency to pay the company you purchased the item(s) from.

Yes. If you make a foreign currency purchase that is cancelled or reversed, your refund will be handled through the authourised foreign exchange dealer.

No. You only pay the FXF when you buy foreign currency, purchase a wire transfer or bank draft, or pay for a foreign transaction. When you receive foreign currency, in whatever form, you do not have to pay the FXF.

No. If you sell foreign currency to a bank or any other authorised foreign currency dealer, you do not have to pay the FXF. The FXF only applies when you buy foreign currency or pay for a foreign currency transaction.

No. The FXF only applies when you buy foreign currency or pay for a foreign currency transaction, so you would not have to pay the FXF.

If you have a foreign currency account and use it to make a foreign payment, you will not have to pay the FXF.

Entities in the International Business and Financial Services (IBFS) Sector that use a foreign currency account to make payments are also exempt from paying the FXF.

No. The FXF does not impact your annual foreign currency travel allowance, nor does it reduce the amount of foreign currency you would be approved to purchase for medical, educational or other purposes should you apply for those allowances.

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