How does Airtm calculate rates and fees?

Definitions:


Market exchange rate: Market rate of local currency relative to 1 AirUSD without fees and commissions.


Net exchange rate: Market rate of local currency relative to 1 AirUSD, with fees and commissions.


Service fee: Percentage of the transaction provided to Airtm. 


Escrow fee: Fixed fee provided to Airtm.


Peer variable commission: Percentage of the transaction provided to the acceptor as a commission for accepting the request.


Peer fixed commission: Fixed fee provided to the acceptor as a commission for accepting the request.


Transfer fee: Fixed fee provided to Airtm.


Blockchain fee: Fee charged by cryptocurrency network.


*When inputting the above values using the below equations, if any value is not provided do not include it in the equation.


Equations:


For requester P2P add funds (adding via submitting a request):

Funds to receive = ((funds to send/market exchange rate) - escrow fee - peer fixed commission) / (1 + service fee + peer variable commission)
Funds to send = (funds to receive*(1 + service fee + peer variable commission) + escrow fee + peer fixed commission)*market exchange rate)


For P2P withdraw funds (withdrawing via submitting a request):
Funds to receive = ((funds to send - escrow fee - peer fixed commission)*market exchange rate) / (1 + service fee + peer variable commission)
Funds to send = ((funds to receive*(1 + service fee + peer variable commission))/market exchange rate) + escrow fee + peer fixed commission


For Direct bank add funds (adding directly):

Funds to receive = ((funds to send/market exchange rate) - transfer fee) / (1 + service fee)
Funds to send = (funds to receive*(1 + service fee) + transfer fee)*market exchange rate)


For Direct bank withdraw funds (withdrawing directly):

Funds to receive = ((funds to send - transfer fee)*market exchange rate) / (1 + service fee)
Funds to send = ((funds to receive*(1 + service fee))/market exchange rate) + transfer fee


For Direct cryptocurrency withdraw funds (withdrawing funds directly):

Funds to receive = (funds to send*market exchange rate - blockchain fee) / (1 + service fee)
Funds to send = ((funds to receive*(1 + service fee))/market exchange rate) + blockchain fee


For Direct debit card add funds (adding directly):

Funds to receive = ((funds to send/market exchange rate) - transfer fee) / (1 + service fee)
Funds to send = (funds to receive*(1 + service fee) + transfer fee)*market exchange rate)


For Peer Acceptors of P2P Requests:

For acceptor P2P add funds (adding via accepting a withdraw request):

Acceptor funds to receive = requester funds to send - escrow fee - (requester funds to receive *service fee/market exchange rate)

Acceptor funds to send = requester funds to receive


For acceptor P2P withdraw funds (withdrawing via accepting an add request):

Acceptor funds to receive = requester funds to send

Acceptor funds to send = requester funds to receive + escrow fee + (requester funds to receive*service fee)

A
Anthony is the author of this solution article.

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