Every remittance app quotes you a number, but very few explain where it comes from. Here is the whole picture, in plain language.
The interbank rate is the starting point
Banks and currency brokers trade EUR against XAF at what is called the interbank or “mid-market” rate — the price large institutions pay each other, with no markup. On any given day this rate moves slightly as currencies are bought and sold around the world. Think of it as the real, wholesale price of a euro in francs.
Most providers add a spread
A “spread” is a hidden markup baked directly into the exchange rate rather than shown as a separate fee. If the interbank rate is 655.96 and a provider quotes you 644, they have quietly kept the difference — often 1.5% to 4.5% of your transfer — without it ever appearing as a line item. This is how some apps can advertise “no fees” while still taking a meaningful cut.
What Katika does differently
Katika buys currency one point above the daily interbank rate, rather than below it. If the market rate is €1 = 655.96 XAF, your family receives 656.96 XAF per euro — and that full rate is shown before you send a single franc, with no spread subtracted afterwards.
Why one point matters more than it sounds
A single point looks small on one transfer. Spread out over a month of rent, school fees and groceries sent home, or compared against a competitor’s hidden 3-4% spread, it adds up to real money landing in your family’s account instead of disappearing into someone else’s margin.
How to check any provider’s real rate
- Look up the current interbank rate for the currency pair (widely published, free, and independent of any transfer provider).
- Compare it to the rate the provider actually offers you — not their advertised rate, the one shown at checkout.
- Add back any flat fee, converted into local currency, to see the true total cost.
Once you compare on that basis, the provider with the best total outcome — not just the lowest advertised fee — becomes obvious.