> For the complete documentation index, see [llms.txt](https://docs.nexusglobalpayments.org/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.nexusglobalpayments.org/fx-provision/rates-from-third-party-fx-providers/improving-rates-for-larger-transactions.md).

# Improving rates for larger transactions

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This page relates **only** to third-party FX Providers.

For Source PSPs that provide their own FX, a different process applies. See [Payment setup for PSPs who provide their own FX](/payment-processing/payment-setup-for-psps-who-provide-their-own-fx.md) for details.
{% endhint %}

## Tier-based improvements for larger transactions <a href="#toc163809590" id="toc163809590"></a>

In Nexus a specific FXP may offer **better rates for larger transactions**. This works as follows:

* For each specific Source Currency, the FXP may define a number of **“tiers”** at which better rates apply.
* For each tier, the FXP will define how much the base rate (as provided in the POST /rates/ API) must be **improved**, in basis points.
* For payments smaller than the lowest tier, the **base rate** (provided when the FXP submits a rate to the `POST /rates/` API) applies.

{% hint style="info" %}
Note:

* An FXP may choose whether or not to set any tiers for a specific currency, and how many tiers to set.
* Different FXPs may set different tier thresholds for a specific currency.
  {% endhint %}

### WORKED EXAMPLE: Tier Improvements <a href="#toc163809591" id="toc163809591"></a>

In this example, the Source Currency is Euros. The maximum payment permitted through the TIPS payment system is EUR 100,000. FXP-A may therefore choose to set the following tiers:

| **FXP Id** | **SOURCE CURRENCY** | **TIER THRESHOLD** (Minimum transaction size at which the improvement applies) | **IMPROVEMENT** in basis points (applied to the base rate in the FXP’s quote) |
| ---------- | ------------------- | ------------------------------------------------------------------------------ | ----------------------------------------------------------------------------- |
| FXP-A      | EUR                 | 25,000                                                                         | 50                                                                            |
| FXP-A      | EUR                 | 50,000                                                                         | 100                                                                           |
| FXP-A      | EUR                 | 75,000                                                                         | 150                                                                           |

This means that for a payment of 50,000, the rate will be improved by 1%, and so the amount received by the Recipient will be 1% greater than it would have been with the base rate.

If FXP-A quoted the base rate for EUR>SGD at 1.500, then the improvement would be calculated as:

* Improved rate = Base Rate \* (1 + ((Improvement in basis points) / 10000)
* \= 1.5000 \* (1 + (100 / 10000))
* \= 1.5000 \* (1 + 0.01)
* \= 1.5000 \* (1.01) = 1.5150

Note that for transactions below the 50,000 threshold, FXP-A’s base rate, as provided in the initial `POST /rates/` API call, will apply.

{% hint style="warning" %}
Tiers only need to be set once by the FXP, and will continue to apply for that FXP until the FXP updates or deletes the tiers.
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