There’s a sales line that goes: send in dollars, they receive dollars, nobody converts anything, so nobody can charge you for converting. Neat. Also incomplete.
Currency conversion doesn’t vanish because you skipped one step. It just moves. Sometimes it moves to a place where you can’t see the rate, which is where the interesting margins live. This guide is about two destinations that attract that sales line: an account that holds a foreign currency, and a card.
Foreign-currency account: what it actually is
It’s a bank account denominated in something other than the local currency. In Nigeria, a domiciliary account holds dollars, pounds or euros. Several other countries have an equivalent, with different names and rules. The point of the account is that incoming money can stay in its original currency until the holder decides what to do with it.
Real benefit, in a few situations. The recipient may want to hold dollars deliberately, pay a dollar bill, or choose their own moment to convert instead of accepting yours. If your recipient is a freelancer who’s paid in a foreign currency, it also avoids a forced conversion on every payment. That’s different from the family-remittance case, though, which is the one this guide cares about.
Costs sit around the edges.
Rules differ by country, and they change
Not everyone can open one, and what you can put in or take out is often set by the central bank. A Nigerian explainer published after the central bank lifted a set of 2021 restrictions in June 2023 says cash deposits are no longer restricted, subject to bank checks, and sets out opening requirements such as ID, referees and a recent utility bill. That is one country, one point in time. Ask the receiving bank, not a transfer app, what the account accepts. For what has happened to the naira itself, see the Nigerian naira guide.
The conversion that still happens
Here is the mismatch most senders miss. Whether conversion happens depends on which account the money lands in, not on what the sender hoped.
If the recipient’s account holds the same currency you send, nothing is converted on arrival. If it doesn’t, the receiving bank converts, using its own rate. And you might have sent into a plain local-currency account while believing you’d chosen a dollar one, because the account number alone doesn’t always tell you what currency it holds. Check with the recipient before you type anything.
To see how large that hidden step can be, take a real example from a UK bank’s help page, current as of November 2026. When a payment in a foreign currency lands in one of its sterling accounts, the bank converts it into pounds on the day it credits, at its standard rate. The page lists a margin of 3.55% over the wholesale rate for payments up to £10,000, falling for larger amounts. There’s a fee on top: £2 for other payments up to £100, £7 for those over £100, with euro payments inside the UK, EEA or SEPA free. The page also warns that an overseas intermediary bank may take a fee, so the amount can be lower than what was sent. This is one bank. Others differ.
Worked example (illustrative numbers)
Say a made-up recipient called Priya in the UK is sent US$1,000 into her pound account. Suppose the mid-market rate is 0.76 pounds per dollar, which is invented. Her bank applies the 3.55% margin and the £7 fee.
- At mid-market: 1,000 × 0.76 = £760.00.
- After the margin: 760 × (1 − 0.0355) = £733.02.
- After the fee: 733.02 − 7 = £726.02.
So £33.98 is gone, about 4.5%, and none of it appeared on the sender’s receipt. If the sender had instead paid in pounds through a service charging a 0.8% margin and no fee, Priya would have received roughly £753.92 (760 × 0.992). The gap is about £27.90. You can check live rates on USD to GBP; the 0.76 above is not a quote.
Lesson: it isn’t “never send in dollars”. Rather, the recipient’s bank, not the sender’s app, may be setting the price, and you only see it later. For a deeper look at why the headline rate and the delivered rate differ, see mid-market versus the rate you get.
Prepaid and debit cards as a destination
Some services can send money straight onto a card. The sender enters the recipient’s card number, and the funds are pushed to it. One provider’s page says the recipient needs a Visa debit card number, that eligibility depends on the card’s issuing bank and country, and that transfers often arrive in near real time or the same day. It also says timing isn’t guaranteed, and delays can come from the recipient’s bank, compliance checks or local conditions.
Genuinely convenient for someone who has a card but no easy way to reach a bank branch. But a card is also a product with its own price list.
On fees, the US Consumer Financial Protection Bureau notes that most prepaid cards charge fees for things like maintaining the account, purchases and withdrawals, and it lists foreign transaction fees among the key terms to look for. Each card has its own terms. The same provider’s page says the receiving bank or card issuer may apply its own fees on top of the sender’s flat fee.
Questions worth asking the cardholder:
- Which currency is the card in? If it differs from what you’re sending, conversion happens at the issuer’s rate.
- Does the card charge to receive funds, to withdraw at an ATM, or to spend in another currency?
- Is the card in the cardholder’s own name, and does the name you enter match it? A mismatch is a common reason for a transfer to be held or refused.
- Does the balance expire, or does the card? The CFPB has a separate FAQ asking if the money is lost when a prepaid card expires; read the card’s terms before relying on it for savings.
No universal answer to any of these. The card’s issuer writes the terms, and they vary widely.
What sender-side apps leave out
A good deal of marketing says “no fees” for sending to a card or a dollar account. Read the sentence carefully. “No fees from us” tells you about one party in a chain. The receiving bank, the card issuer and any intermediary bank in the middle are separate parties, each of which can charge. A card payment and a bank transfer can look identical on your end and quite different on the other.
Another trap: the same service that quotes a rate to you for conversion may not be the one who converts. If you choose to send in the recipient’s currency, the sender’s provider converts and you see the rate. If you send in your own currency to a destination that holds a different one, you may have no idea who converted or at what price.
For the general method of comparing deals by what lands rather than what’s advertised, see how to spot a bad transfer deal.
Before you send
Three checks cover most of the damage.
Ask the recipient, in words, what currency the destination account or card holds. Ask whether they will want to keep it that way or convert it, and when. Then get a quote that shows the amount the recipient will have in the end, in the currency they plan to use, after any receiving-side charge. If the provider can’t tell you that, assume there is a receiving-side cost and compare a direct local-currency payout.
Rules on foreign-currency holdings, card eligibility and reporting differ by country and change. Check with the receiving bank or card issuer. This is general information, not financial advice.
Sources
- Receive an international payment (Lloyds Bank)
- Send money to a Visa card (Paysend)
- Prepaid cards (Consumer Financial Protection Bureau)
- Explainer: all you need to know about domiciliary accounts (TheCable)
Checked: November 2026
