Benefits Offset Exchange Rates at Overseas Military Banks

Service members and their families overseas will not suffer from higher currency exchange rates at military banks and ATMs, officials said, because allowances increase to offset the higher rate. Defense Finance and Accounting Service officials note that overseas military members and other customers of the Community Bank have asked why the foreign exchange rate differs from that at other banks on the local economy or other published exchange rates. The exchange rate at a Community Bank branch, known as the Community Bank Accommodation Rate, differs because the Community Bank charges a 2.5 percent commission fee to defray costs, officials said. Costs incurred include currency acquisition and delivery to bank customers. However, to offset this out-of-pocket cost for overseas military members, the Overseas Housing Allowance and Cost of Living Allowance are increased an equal amount.