UK Home Office Currency Conversion Rates for GBP & the Iranian Rial – OANDA

The conversion rate used by the Home Office & UKVI in relation to the Iranian Rial presents significant problems for Visitor Visa Applicants

The Home Office & UKVI require applicants for most visas to prove that they have certain levels of funds available for their financial maintenance costs. Sometimes this is an exact amount that needs to be evidenced by bank statements. Very often these funds will be held abroad in foreign currency accounts.

For most people this is not a problem and normally the Home Office uses the “OANDA” exchange rate. This is a widely-respected currency conversion program that appears on the internet which provides current and historical exchange rates for all currencies. OANDA exchange rates are more or less “official exchange” rates. The Home Office has even incorporated the OANDA system into its published policy guidance for certain visa categories.

However; for Iranian visa applicants this system presents huge complications and it is important to get the facts right at the start of an application, because this can lead to refusal decisions.

What is the problem for Iranian Visa Applicants:

Well there are a number of reasons why the conversion and calculation of the Iranian Rial (or Toman) is extremely complicated. The reasons can be summarised as follows:

  1. The Iranian Rial currency has suffered hugely from depreciation and the effects of inflation – much of this has been because of sanctions unilaterally imposed by America against Iran. In the last 2 years alone the Iranian currency has depreciated 750% against Sterling and the US Dollar
  2. Iran runs what amounts to two separate rates of exchange. There is the formal rate of currency exchange quoted on the Tehran Stock Exchange and that is also quoted by OANDA. There is a second ‘black market’ rate of exchange which is basically the street exchange rate (the rate at which ordinary people are buying and selling foreign currency)
  3. The official Iranian Rial exchange rate is only available to individuals and companies approved by the Iranian Government. Ordinary Iranians cannot purchase foreign currency at the official rates of exchange without a permit and as you can imagine such permits are almost non-existent

The black-market value of the Iranian Rial – which many consider to be the real value of the currency – is significantly lower in the black market than the OANDA rate. To give you an example of how wide the values are, today at the time of publishing this blog post the OANDA site is quoting 54,208 Iranian Rials to £1 Pound Sterling. However; at the same time the black-market rate today is 295,500 Iranian Rials to £1 Pound Sterling. That means that there is an almost 600% price difference between the two rates. A huge disparity no matter what the situation might be.

The problem arises for visa applicants who have their funds in recognised banks in Iranian currency. Which rate does the Home Office use to calculate the value of these savings?

Until recently the Home Office Entry Clearance Officers continued to use the official OANDA rate of exchange. That was of course favourable for most Iranian applicants as it elevated the real value of the money they held in savings accounts. However; recently the Home Office have changed some of their decisions and we have become aware that the Home Office, when considering visitor visa applications, is using the black-market rate for Iranian Rial to UK GBP Pound conversion calculations.

Recent Home Office Visa Decisions

A visitor visa refusal decision we have recently seen states as a reason for refusal of the visa “I am aware from information in the public domain and other currently conversion tools, such as, that while the OANDA website shows the official exchange rate, it is not possible to exchange currency at the official rate”.

There is no mention of OANDA in the visitor visa rules or published policy guidance (as opposed to other visa routes), so it is presumably quite legal for the Home Office to adopt this position. Some visa categories specifically state that the Home Office will use OANDA when calculating the level of funds available in foreign currency accounts. However; the Immigration Rules relating to Visitor Visas do not stipulate that OANDA will be used. This means that Iranians applying to come to the UK as visitors need to be particularly careful.

The issues about funds held in Rials can be very difficult, and visitor visa applications are frequently refused because of issues concerning this; not only the value of funds but also the source of funds.

A visitor visa application needs to be presented solidly and with clear evidence to give it the best chance of success. There are at present no automatic rights to appeal a visitors visa refusal, but with a solidly prepared strong application it may be possible to challenge an unreasonable refusal decision by way of an application for Judicial Review.