Anyone connected to the Brazilian financial market knows that there are two types of exchange rates, and it is necessary to understand the difference between the commercial dollar and tourism.
To understand this difference, however, it is good to first understand the exchange rate in Brazil, which is not an easy task, as it is necessary to monitor the financial market turbulences.
The website Transferwise, specialist in exchange rates, explains what the term exchange rates mean.
According to them, an exchange rate is essentially a comparison of two currencies at the same time.
For example, how much do you earn in exchange for each dollar? An exchange rate provides an exact proportion of the value of each country’s currency.
Making a comparison between the value of the currencies, which can change at any time, depending on the fluctuation of the financial market. Confused, right?
In the past, Brazil used to have two types of foreign exchange market taxed by the central bank, one for tourism and other commercial.
Today, these rates are free for negotiation, by financial institutions that may charge different exchange rates, according to their taxation, which leaves this understanding confused by consumers.
After all, what’s the difference between tourism and commercial dollars?
Basically, the difference exists for the types of transactions that are carried out.
In the case of the commercial dollar, they do not require physical money and are normally only online transactions.
In the case of the tourism dollar, most of the time they require physical money and a purchase fee, which end up generating logistics and government fees.
What is Commercial Dollar?
The commercial dollar is used in negotiations for the import and export of goods and services from Brazil to the world, it is generally used in large businesses between companies or in government negotiations.
These transactions do not require physical money, as they are made only online.
What is tourism dollar?
The tourism dollar is quoted for individuals and is used for travel, as well as for online shopping.
The dollar value of tourism is higher because, includes the IOF (tax on financial transactions) and the costs that take the currency to the final consumer.
In other words, the difference between the commercial dollar and tourism is in the quantity that is traded.
Commercial if it is quoted for legal entities and Tourism for individuals, which is more expensive because it includes more taxes.
These tourist dollar rates vary according to the situation of the day in the financial market.
Often, these variations show up on your card bill when you shop on international websites.
Therefore, you need to choose digital payment methods that choose the best exchange rate.
Some companies, such as LATAM for example, use the commercial dollar of the day for conversion, disclosed by the Central Bank, facilitating your customers’ payment process.
Now that you know what the difference tourism and commercial dollar is, stay tuned for the best financial solutions available on the market.. Meet our solutions.