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Richard Berry
- Updated
Currency forward brokers let you buy currency now at the current exchange rate for a settlement date in the future. When you do the conversion, you put down a small deposit, then pay the balance on the date you need the full amount.
Currency forward contracts are one of the most common ways to reduce and hedge currency exposure for businesses or protect against adverse exchange rates when buying a property overseas.
Good Money Guide has hand-picked the best accounts for currency-forward contracts. You can also request multiple quotes from providers to compare currency forward contract rates to get the best exchange rates.
Compare Currency Forward Contract Accounts
| Currency Forward Provider | FX Forward Lengths | Number of Currencies | Min Transfer | Currency Options | Customer Reviews | GMG Rating | Get Quote |
|---|---|---|---|---|---|---|---|
 | 24-months | 40 | £100 | ❌ | Request Quote | ||
 | 12-months | 40 | £100 | ❌ | Request Quote | ||
 | 12-months | 55+ | £250 | ❌ | Request Quote | ||
 | 24-months | 30+ | £3,000 | ✔️ | Request Quote |
Our picks of the best accounts for currency forward contracts
❓ Good Money Guide chose the best currency forward contract providers based on:
- 20 years expertise and experience in the currency forward industry
- Interviews with the currency forward provider CEOs and senior management
- Over 30,000 votes and reviews in the prestigious Good Money Guide awards
- Thorough, hands-on analysis and testing of the platforms and pricing
Summary:
- Corpay: Best currency forwards for corporates
- TorFX: Great overall currency forward provider
- Currencies Direct: best FX forward provider for customer service
- OFX: best for tailored FX strategies & high touch service
Corpay: Best Currency Forwards For Corporates
- Forward contract: 24 months
- Currencies: 30+
- Minimum transfer: £3,000
- Annual transfers: £6bn
- Number of customers: 30,000
Corpay (formally Global Reach) is one of the largest currency forward brokers for private clients and can help individuals and companies with currency forward contracts in a wide range of leading currencies as well as a selection of exotics.
Is Corpay good for currency forwards?
Corpay (formally Global Reach) offers a range of currency hedging solutions for individuals and businesses including currency forwards of up to two years. Corpay provides forwards on a wide range of leading currencies as well as a selection of exotics. Using their expert dealing team, you can handle important transfers overseas.
Expert Review
Name: Corpay
Description: Corpay is a currency broker that manages money transfers and currency exchange for corporate and business clients. Founded in 2001 in Canada, they have grown steadily and now handle more than £5bn in transactions each year. The platform covers all major currencies plus a host of ‘exotics’ and has an impressive 97% satisfaction rating on Trust Pilot.
Is Corpay a good currency broker?
Yes, we rate Corpay as one of the best and most efficient ways for individuals and companies to transfer money internationally, quickly and cheaply.
Corpay is one of the few currency brokers that also offers currency options. Whilst they do provide excellent exchange rates for currency transfers, this also means they can help with personal and business currency exposure hedging.
Pros
- Excellent exchange rates
- Currency hedging facilities
- Personal service
Cons
- Suitable for large clients only
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Exchange Rates
(4.5)
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Available Currencies
(4.5)
-
Online Platform
(5)
-
Customer Service
(5)
-
Research & Analysis
(3.5)
Overall
4.5What next?
TorFX: Great Overall Currency Forward Provider
- Forward contract: 24 months
- Currencies: 40+
- Minimum transfer: £100
- Annual transfers: £7.5bn
- Number of customers: 325,000
TorFX won “best currency forward provider” in our 2023 awards. TorFX (founded in 2004) is better suited to those who need to transfer a large amount of money as they provide a personal service where you can ask for price alerts, advice on market timing and also protecting your budget through currency forward contracts.
Is TorFX good for currency-forward contracts?
TorFX offers forward currency contracts of up to twenty four months for those wanting to lock in the current exchange rate. They provide a personal service where you can ask for price alerts, advice on market timing and also protecting your budget through currency forward contracts.
Expert Review
Name: TorFX
Description: TorFX is a currency specialist and currency broker founded in 2004 offering foreign exchange conversion services in 40 currencies. TorFX converts and transfers around £7.5 billion a year and is based in Cornwall, UK.
Should you send money abroad with TorFX?
TorFX won the Good Money Guide “People’s Choice” Award in 2024 for having the most and best reviews from satisfied customers.
Prior to that, TorFX won best currency forward provider in 2023 for their 24-month forwards for people wanting to lock in current exchange rates for up to 1 year in advance.
TorFX customer reviews speak for themselves, a low-cost way to transfer money internationally at a bank beating exchange rates and expert advice on timing the process.
A good choice if you are buying a property abroad and want bank-beating exchange rates and personal service to help with the transfer.
Pros
- Personal service
- Bank beating exchange rates
- Currency forwards
Cons
- Not great for small transfers
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Pricing
(4.5)
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Market Access
(5)
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Online Platform
(4)
-
Customer Service
(5)
-
Research & Analysis
(5)
Overall
4.7What next?
Currencies Direct: Best FX Forward Provider For Customer Service
- Forward contract: 12 months
- Currencies: 40+
- Minimum transfer: £100
- Annual transfers: £7.5bn
- Number of customers: 325,000
Is Currencies Direct good for currency forwards?
Currencies Direct offers forwards on over forty currencies of up to 12 months through a network of 22 offices worldwide and serves more than 325,000 personal, business and online selling clients. You can do forwards online, through the company’s app, in one of its branches or over the phone with the help of an account manager.
Expert Review
Name: Currencies Direct
Description: Currencies Direct is a specialist award-winning currency broker that can help you send large amounts of money abroad. They were founded in 1996 and are now part of a group that processes around £10bn in international money transfers per year.
Are Currencies Direct a good currency broker?
Yes, in our 2024 and 2023 awards Currencies, Direct won “best currency broker”. They scored very highly in our customer survey, with very high scores in customer satisfaction and pricing. Currencies Direct is also a well-established provider founded in 1996 and has 22 offices around the world.
Currencies Direct offer a good service for large international money transfers. They are a well-established and competitive currency broker for buying a property abroad or for international business payments at bank-beating exchange rates.
If you need to send a large amount of money abroad Currencies Direct can give you advice on the timing of a transfer and also get you bank beating exchange rates.
Pros
- Great for large currency transfers
- Get a dedicated account executive to help with transfers
- You can send money over the phone or do transfers online
Cons
- Better for large transfers
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Pricing
(4.5)
-
Market Access
(4.5)
-
Online Platform
(4)
-
Customer Service
(5)
-
Research & Analysis
(5)
Overall
4.6What next?
OFX: Best For Tailored FX Strategies & High Touch Service
- Forward contract: 12 months
- Currencies: 55+
- Minimum transfer: £250
- Annual transfers: £2.4bn
- Number of customers: 1,000,000
Is OFX good for currency forwards?
OFX offers currency forwards up to 12 months and does not charge any fees on top of the exchange rate you get. Exchange rates are of course bank-beating and are based on size, so the larger your transaction the better the rate you will receive.
OFX does not charge any fees on top of the exchange rate you get. Exchange rates are of course bank-beating and are based on size, so the larger your transaction the better the rate you will receive.
Expert Review
Name: OFX
Description: OFX is a leading currency broker offering currency services to more than 170 countries around the world. Originally known as OzForex, it was launched by Matthew Gilmour in 1998 as an information only website. Since then, it has grown rapidly handling more than AUD$2000bn transfers for more than a million individual and business customers worldwide.
Is OFX a good currency broker?
Yes, we rate OFX as a very good currency broker as they offer discounted exchange rates, personal service for individual buying a property abroad of for businesses needing more complex services like integrated Amazon payments or currency hedging strategies.
OFX offer a great way to time and save money on large currency transfers for either foreign property purchase international moves or for business transactions.
If you have a large currency conversion coming up OFX can help you reduce costs when buying a holiday home abroad, or moving to another country. These key benefits of using a currency broker like OFX for international property purchases are:
- Better exchange rates
- Control over the price and time of the conversion
- Personal support
OFX Offer Competitive Exchange Rates
When purchasing property abroad, exchange rates can significantly impact the overall cost, especially if you send the money from a traditional high street bank, which can charge up to 4% of the value of the foreign currency. Using a currency broker like OFX means that you can negotiate lower commissions. Whilst FX pricing may seem complicated, it’s quite simple to calculate. We’ve produced guides on ‘how to compare exchange rates‘ and how to avoid ‘honeymoon exchange rates‘, which will help you get better exchange rates when sending money abroad.
Transfer Timing & Flexibility
When you transfer money with your bank you have little or no say over when it is done or at what exchange rate is used, as the bank just provides a rate which you can either accept or not. But OFX will let you set a limit if you have a price in mind and you can also lock in an exchange rate for a future transfer (using forward contracts) or want to set up regular payments for a mortgage.
24/7 Service and Support At OFX
Again, banks are quite impersonal things, and even the new breed of digital banks like Starling and Monzo (who do provide good exchange rates) don’t offer personal services. Large currency transactions for buying property in another country can be stressful, especially when navigating different time zones and dealing with the onerous AML requirements and delays. It’s important and actually quite reassuring to have an account manager at OFX you can call for support, ensuring that you can get help whenever you need it, no matter where you are in the world.
Pros
- Bank beating exchange rates
- Personal service and good tech
- Currency hedging solutions
Cons
- Better for larger transfers
-
Exchange Rates
(4.5)
-
Available Currencies
(4.5)
-
Online Platform
(4.5)
-
Customer Service
(5)
-
Research & Analysis
(4.5)
Overall
4.6What next?
What Are Currency Forwards?
Currency forwards are very simply a ‘buy now, pay later’ form of currency transaction. There are many ways to protect yourself from FX price moves, but the most popular for people buying holiday homes or managing business currency exchange rate exposure is to use a currency forward.
Request Currency Forward Exchange Rate Quotes
To find the best currency forward exchange rates you can compare quotes from our panel of currency brokers. Each FX forward provider will send you a quote based on the currency exchange rate and your forward settlement date.
Note: It’s important to note that currency forward quotes will change as the underlying currency exchange rate moves and the individual interest rates associated with the currency pair’s country change.
What Can Currency Forwards Be Used For?
Currency forwards are used for locking in the currency exchange rate for a currency conversion in the future. The most common reasons for using a currency forward are:
- Buying a property abroad
- Locking in profits from an upcoming foreign property sale
- Budgeting for foreign income
- Budgeting for recurring international payments
- Locking in an exchange rate for an upcoming foreign invoice
Pros
- Reducing risk – Protecting your budget from currency prices moving against you
- Locking in profits – If you are budgeting you can use a currency forward to lock in profits on a foreign transaction or make sure that an upcoming foreign property purchase does not cost you more than the currency exchange rate
- Cost effective – Currency forwards generally shouldn’t cost any more in (exchange rate) fees than a normal transaction. They are cheaper than buying a full amount of currency outright
- Flexibility – You can draw down early on a currency forward by reducing the position if you need some foreign currency early
Cons
- Loss of positive gains – If you buy a currency forward contract early then you miss out on exchange rates potentially moving in your favour. Of course, no one can predict where a price may be in the future so with large foreign exchange transactions it is often prudent to err on the side of caution
- Deposit protection – Currency brokers are not covered by the FSCS so if a currency broker defaults your deposit and position are not protected by UK regulators
- Commitment – Unlike futures and options currency forwards must be carried to settlement. You cannot close a currency forward before the settlement date without incurring significant costs
How To Buy Currency Forward Contracts
To buy a currency forward you need an account with a regulated currency broker that can arrange the transaction for you with institutional banks. It may sound complicated, but the process is as simple as opening a bank account.
Here are the steps you need to follow to buy a currency forward:
- Open an account with a currency broker that offers currency forwards (like OFX, or Currencies Direct)
- Select a date in the future that you want the forward to settle (this can be up to 24 months)
- Request a quote – your broker will then give you a forward price (this will be based on the interest rates of the two currencies you are exchanging)
- If the quote is acceptable, agree to the deal. You will have to put down a small deposit of the value of the transaction to cover market fluctuations
- When the settlement date arrives, deposit the remainder of the funds with your broker and withdraw or transfer the foreign currency.
Currency Forwards Explained
Currency forwards are very simply a buy now, pay later form of currency transaction. There are many ways to protect yourself from FX price moves, but the most popular for people buying holiday homes or managing business currency exchange rate exposure is to use a currency forward.
Most currency brokers offer currency forwards service as standard, so in this guide, we look at a few things to look out for to make sure you get the best currency-forward deal.
Why would you need a currency forward?
If you need to buy or sell a large amount of foreign currency for a foreign property purchase or sale in the future, currency forwards let you lock in an exchange rate for up to a year in advance on a buy now pay later basis.
You have to put down a small deposit to cover market movements in the meantime and the balance is due on settlement.
How do currency forwards work?
Currency forwards work by letting you buy a set amount of currency now for a specific date in the future with only a small deposit.
You convert money either online or over the phone as though it was a normal same day conversion. However, as the settlement date will be in the future the pricing will be slightly different. It may be in your favour or against you depending the interest rates of the two currency countries.
So, for example if you want to lock in the current GBPEUR rates for a purchase of 100,000 Euros, you would buy 100,000 Euros, but instead of paying the GBP you only pay 5% as a deposit, then the balance when the trade settles, this could be any point up to a year in advance for most currency forward brokers.
You must always take delivery of the currency with a forward contract. So for those who don’t need the actual currency but just want to offset potential adverse currency movements, there are a few guides on options and futures brokers to consider.
How are currency forward prices calculated?
Currency forward contract prices, are calculated by how much it costs to borrow a country’s currency based on a country’s interest rates.
A currency pairs current spot exchange rate is adjusted by the ratio of the sum of the foreign currency’s domestic interest rate multiplied by the time to maturity to the sum of one and the domestic interest rate multiplied by the time to maturity reflecting the interest rate differential between two currencies over a specified period.
However, clients of currency brokers can request a currency forward quote without knowing the currency forward contract pricing formula by:
- Requesting a currency forward via our online quote request form
- Giving experienced dealers a call at one of our currency broker partners
- Emailing any of these currency forward brokers with your currency forward amounts, currencies and dates
- It’s worth noting that all currency forward quotes are indicative. To get a firm quote, you need to have an active and approved account at a currency broker.
Hedging with forward currency contracts
Currency hedging forward contracts are really very simple. They allow either individuals or businesses with exposure to currency risk to protect themselves from adverse moves in the foreign exchange market.
The main thing to consider when looking at hedging currency exposure with forward contracts is your appetite for risk.
If you are very risk-averse and like to budget precisely, then a forward contract is the most effective way to hedge your currency exposure.
However, if you are happy to taking some risk on your currency exposure, there are other currency hedging tools that can be used like currency options, currency futures.
What to watch out for when using currency forwards
Live forward currency contract exchange rate quotes are available online, you need to open an account with an online currency broker and request quotes using their online platform as and when you need them.
Sometimes, a country’s exchange rates can act in your favour, and the more commission-hungry brokers will, on occasion, not offer this price improvement to customers, instead giving the actual spot price rather than the forward rate.
Advantage of currency forward contracts
The main advantage of currency forward is reducing risk.
If you are budgeting you can use a currency forward to lock in profits on a foreign transaction or make sure that an upcoming foreign property purchase does not cost you more than the currency exchange rate.
Currency forwards generally shouldn’t cost any more in (exchange rate) fees than a normal transaction.
The advantages are clear, the most obvious being you can stop things costing you more, or make sure you don’t lose out on foreign currency due at some point in the future.
- Buy now, pay later
- Lock in the current exchange rate for a future purchase/receipt
- Hedge your exposure and reduce your risk
- Very simple to set up
- Inexpensive to maintain
- You can draw down to get currency early
- You can rollover f you don’t need funds until after the original settlement
Read our guide to preparing for a large currency transaction here
Disadvantages of currency forward contracts
Missed opportunity is the main disadvantage of currency forwards.
If you buy currency early then you miss out on exchange rates potentially moving in your favour. Of course, no one can predict where a price may be in the future so with large foreign exchange transactions it is often prudent to err on the side of caution.
The main disadvantage is of course hindsight. One thing to bear in mind when looking at currency risk protection is that hedging can work against you. However, there are only a few disadvantages, compared to the protection that a currency forward provides.
- If the currency moves in your favour you have missed the gains.
- The small deposit required still ties up capital
Currency forward contract examples
Here is an example of a forward exchange contract example and how it can be used by individuals and businesses.
We’ll look at two scenarios here. Firstly an example of how a forward exchange contract can be used to help protect a couple by a holiday home abroad. Then an example of how a forward exchange contract can be used to protect a business’s profit margin when ordering goods from abroad.
For individuals
In this scenario, a couple are buying a holiday home in Italy for EUR 500,000. The couple have agreed on a price with the seller in Italy, but the money does not need to be paid for another 6 months. However, the couple are worried that the GBPEUR exchange rate may move against them and, therefore, cost them more.
- At the current exchange rate of 1.1866 (15/1/25), buying EUR 500,000 would cost £421,340.
- However, if the GBPEUR rate moved to 1.1283 (where it was a year ago) in 6 months, then EUR 500,000 would cost £443,114.
- This is only a move of 4.9%; if you look at the 1-year GBPEUR chart below, you can see this is quite possible.
- In this case, had the couple locked in the current exchange rate, they would have saved £21,774.
- However, if the GBPEUR rate continues to rise, the couple would not benefit from the improved exchange rate.
For a businesses
In the same respect, a business must protect itself from adverse currency moves. If a business buys goods from Italy with a view to selling them in the UK they can lock in the current exchange rate to protect profits.
In this instance, we shall use the same figures to demonstrate how a currency forward can protect a business’s profit margin.
- At the current exchange rate of 1.1866 (15/1/25), buying EUR 500,000 would cost £421,340.
- However, if the GBPEUR rate moved to 1.1283 (where it was a year ago) in 6 months, then EUR 500,000 would cost £443,114 (a move of 4.9%).
- In this case, if the business was expecting to make a profit margin of 10% on the sale of imported goods (£42.1k), the adverse currency move would have in effect reduced their profits by £21,774, as they would have to pay £443k for their stock rather than £421k.
Of course, one of the disadvantages of currency forwards is that if the exchange rate moves in your favour, then you do not benefit. However:
When it comes to hedging currency exposure and risk management it is very easy to protect yourself from losing money, but very difficult to predict where the markets are heading for profit.
Currency Forward Contract FAQs
Between 12 and 24 months. Of the brokers we feature, Corpay and TorFX offer the longest-dated currency forwards up to two years.
Currency forwards are quite complex to price, so the best way is to compare one currency brokers quote against another. You can do this in our currency forward contract account comparison table.
Yes, once you have an account with a currency broker that offers forward contracts you can request live quotes and get currency forward quotes online 24 hours a day for up to a year in advance. You can also check currency forward rates over the phone with experienced dealers who can also advise on currency forward pricing potential movements.
Currency forward contract prices are based on the difference between the underlying interest rates of the currency pairs involved in the transaction and added or subtracted from the spot rate.
Customers can drawdown funds on currency forwards before they are due to settle. But, all currency forward contracts have to be ultimately settled. This can be done by opening currency forward to net off the contract and effectively have two forward contracts running to the same settlement date, making you flat, which is the equivalent of closing a forward.
Yes. If a customer requires funds later for settlement, the forward contracts can be rolled over ahead of settlement (essentially bought and sold for different dates).
Yes, you can buy or sell a currency for a forward date essentially protecting from up and downward currency moves.
Currency forward contract fees are built into the exchange rate and marked up from where a currency broker buys or sells the currency forward.
You can trade currency forward contracts on most G10 currencies. However, some currency brokers offer more currencies than others, OFX for example offers over 55 currencies.
Richard Berry
This article contains affiliate links which may earn us some form of income if you go on to open an account. However, if you would rather visit the forward currency contract providers via a non-affiliate link, you can view them directly here: