Foreign exchange market plays a vital role in transferring remittances among different countries. It allows foreign exchange companies to provide services according to the interest rates, investment prospects and exports. The fluctuations seen in foreign exchange markets influence the currency a lot. When people send or receive remittances, the value of the currency matters to a large extent.
Where foreign remittance influences the value of a currency, often the value of a currency can also affect the amount of foreign remittance being sent. Poor exchange rates certainly don’t stop people from sending money home to family but it does influence the amount of extra remittance sent. The foreign exchange market is a platform where interest rates are set according to the supply and demand of currencies.
Foreign exchange markets serve as a point of reference between two interested parties to conduct a foreign exchange transaction which also involves remitting money overseas. Banks and other money transaction companies mark up the price to make profits. Same goes with the online providers who convert currencies but it is not illegal to do so and it is an authorized trade practice. Foreign exchange market sets the value of currencies by comparing with other currencies which define what amount of the transfer funds the receiver will get.