Bank or payment institution: what to check in one minute

The question arises when it is time to convert, and it is badly settled when you do not know what the second term covers. A payment institution is not an informal intermediary: it is a regulated category, with an authorisation, a supervisor and an obligation banks do not have in that form.

What a payment institution is

It is authorised by a national supervisor under the second European payment services directive, and it operates across the Union by passporting. It takes no deposits and lends nothing: it executes payment transactions, which includes conversion and transfer.

In exchange for that narrower scope, article L522-17 of the Monetary and Financial Code imposes segregation: client funds are held on an account separate from its own. Your euros do not mix with its cash and do not share its fate in difficulty.

That is the central guarantee, and the only one you really need to verify.

The check, in one minute

The national supervisor keeps a public register, searchable online and free of charge. You look up the provider’s exact corporate name, not its trading name, and read three things: the authorisation category, the date obtained, and the countries where it operates by European passporting.

A provider not listed there is not authorised, whatever the quality of its website and whatever logos appear in the footer. On a six-figure sum, that is a minute well spent.

What really separates the three routes

Your home bank has the most complete licence and the least favourable exchange margin, almost always. It is the simple route, and it costs.

A specialist payment institution has a finer margin and gives access to tools a bank does not offer retail clients, notably the forward contract that locks a rate for a future conversion.

An unauthorised intermediary has no licence, no segregation and no remedy. It shows on the register, or rather it does not.

The one question that compares two offers

It mentions neither fees nor commissions, and it is asked to both providers in the same minute: how many euros will I receive exactly for this amount in my currency?

That single figure contains everything, margin included. Comparing fee schedules leads nowhere, since the main cost, the margin taken on the rate, appears on no line. And comparing two rates quoted at different hours compares nothing: fifteen minutes is enough to make two quotes incomparable.

On a property price, the margin is negotiable. Ask explicitly: it is a large amount, and providers know it.

What neither will lift

Two constraints do not depend on your choice and are prepared either way.

Identity and source-of-funds checks bind everyone, bank and payment institution alike, and they lengthen on large amounts from far away. Open the accounts from the signing of the preliminary contract, never after.

And on the day of the transfer to the notary’s practice, vigilance bears on an entirely different risk, this one irreversible: bank-details fraud targets foreign buyers precisely, who have never met their contact.