How Does the Wholesale Foreign Exchange Market Work?

Hi @alexs! MasterCard authorisations do indeed use a live bid rate which is frequently updated throughout the day. :slight_smile:

Settlements are processed together in batches. There are several clearing cycle batches each week day. A transaction normally settles a few days after the original authorisation, during which time the exchange rate can change. This is why Monzo shows the exchange rate as pending. :hourglass_flowing_sand:

Each clearing cycle uses a single exchange rate determined by MasterCard. This means that although your two ATM transactions are showing different rates after they have been authorised, it is likely they will be have the same exchange rate after settlement because they will be processed in the same clearing cycle.

Multiple clearing cycles per day also means that sometimes the exchange rate you see for a settled transaction varies slightly from the official MasterCard daily exchange rate webpage. (Because the webpage displays an average across of all of the clearing cycles).