A Bureau de Change (BDC), or a currency exchange office, is a business where people can exchange one currency for another. These businesses are typically located in places frequented by travelers, such as airports, train stations, or popular tourist areas. Their main purpose is to provide a service for people who need to use different currencies when traveling internationally.
Bureaus de Change can conduct a variety of transactions, but their primary function is to exchange one type of physical currency for another. For instance, if you are traveling from the US to the UK, you could exchange your US dollars for British pounds at a Bureau de Change.
While Bureaus de Change are common around the world, their presence and operations can differ from country to country based on local regulations and demand. For instance, in some countries, they are far more common due to a high volume of international tourism or business, while in others they may be less common.
Yes, they are typically licensed and regulated by local and national authorities. The specifics of these regulations can vary depending on the country. For instance, in the UK, bureaus de change are regulated by the Financial Conduct Authority. In the United States, they are considered Money Services Businesses (MSBs) and are regulated by the Financial Crimes Enforcement Network (FinCEN) and various state-level agencies. As such, someone wishing to set up a Bureau de Change would typically need to obtain the appropriate licensing and comply with all relevant regulations.
The advent of digital technology has indeed made it possible to operate a Bureau de Change entirely online. These businesses function similarly to their physical counterparts, but rather than handling physical cash, they perform digital transactions. Customers can specify the amount of one currency they wish to exchange, and the online Bureau de Change will then transfer the equivalent amount of the target currency to the customer’s bank account or digital wallet.
Regarding money transfers, regulations differ by country. In many countries, Bureaus de Change can perform international money transfers. However, this often comes with additional regulations, as these kinds of transactions can be susceptible to misuse for money laundering or other illicit activities. As such, Bureaus de Change may need to adhere to stricter Know Your Customer (KYC) and Anti-Money Laundering (AML) policies when conducting these types of transactions.
In summary, Bureaus de Change are a common type of financial service, but their operations can vary widely based on location and whether they operate in a physical or online setting. They are typically subject to financial regulations and need appropriate licensing to operate, particularly if they handle international money transfers.
This page was last updated on May 30, 2023.