The £1 Million Question: When Is the Best Time for a Business to Convert Currency?

Imagine your company needs to convert the equivalent of £1 million to pay an overseas supplier.

Your business could be a Nigerian importer converting pounds into US dollars, a Kenyan company buying euros to pay a supplier, or a UK business sending funds to Africa.

When you are moving this much money, even a small change in the exchange rate can make a significant difference. A 1% movement on £1 million is worth roughly £10,000, while a 2% movement is about £20,000.

At TranzyPay, we help businesses make cross-border payments at competitive exchange rates while keeping them informed about currency movements that could affect the cost of their payments.

With exchange rates constantly changing, this brings us to an important question: when is the right time for your business to convert?

First, understand what is moving your currency

Currencies rarely move without a reason.

Interest rates, inflation, economic growth, employment data, commodity prices, political developments and central bank policies can all influence exchange rates.

However, the factors that matter most depend on the currencies your business is dealing with.

For example, a company making payments between pounds and US dollars should pay attention to decisions and economic signals from the Bank of England and the US Federal Reserve.

For a Nigerian importer buying US dollars, other factors may also matter, including foreign currency liquidity in the local market, oil prices, dollar supply and policies from the Central Bank of Nigeria.

Similarly, a South African business dealing in rand may need to watch interest rates, commodity prices and investor sentiment, as these can influence the value of the currency.

Understanding what drives the currencies your business uses can help you identify potential risks and make better-informed conversion decisions.

Should your business wait for a better rate?

This is where the decision becomes more difficult.

Consider a Nigerian importer that needs US dollars to pay a supplier in 30 days.

The business has two choices: convert the money now or wait in the hope that the naira strengthens before the payment is due.

If the naira strengthens, the business may need fewer naira to settle the same dollar invoice. But if the naira weakens, the payment becomes more expensive.

The same situation applies to a UK company buying euros, a Kenyan importer buying dollars or a South African business paying a supplier in pounds.

Importantly, choosing to wait is also an FX decision. By delaying the conversion, the business is accepting the risk that the exchange rate could move either in its favour or against it.

The goal, therefore, should not simply be to find the perfect exchange rate. It should be to understand how much currency risk the business can reasonably take while still protecting its costs, margins, and cash flow.

Does the time of day matter?

Yes, especially when dealing with widely traded currencies.

According to the Bank for International Settlements, the global foreign exchange market handled an average of about $9.6 trillion in transactions per day in April 2025. The United Kingdom remained the world’s leading foreign exchange trading hub, accounting for about 38% of global transactions.

When the London and New York markets are both open, liquidity is often higher, particularly for major currencies.

However, high liquidity does not always mean stable exchange rates.

Inflation reports, employment data, and central bank decisions can cause sudden movements in currency markets, even during highly liquid trading periods.

That is why businesses planning a large currency conversion should consider both market liquidity and upcoming economic events before making the exchange.

Regulation matters too

For businesses moving money between Africa and international markets, FX decisions are not just about exchange rates.

Local rules on accessing and moving foreign currency also matter.

For example, Ghana introduced a new Foreign Exchange Operations Framework in July 2026, while South Africa is reviewing its capital flow regulations, including rules around cross-border transactions.

For businesses operating across several markets, understanding local FX regulations can therefore be just as important as monitoring exchange rates.

So, when should your business convert?

The decision depends on more than whether a currency looks cheap or expensive today.

Businesses should consider market conditions, upcoming economic events, local regulations, payment deadlines, and the potential cost if the exchange rate moves against them.

For larger payments, businesses can also decide whether to convert the full amount at once or in smaller stages.

The goal is not to outsmart the FX market. It is to avoid leaving a major business expense to chance.

So, the million-pound question is not simply, “When should we convert?” but, “Do we understand our FX exposure well enough to know when to act?”

At TranzyPay, businesses can send, receive and convert funds from a single dashboard, making it easier to manage international payments in one place.

Planning an international payment? Speak with TranzyPay today.