Cards vs cash for Brits abroad
If you’re thinking of using a credit card as your main form of currency when going abroad this year, maybe you should think again.
Recent research reveals that Brits abroad will be paying a staggering 360 million in fees when using cards abroad. There are a number of ways in which these fees are charged, the most obvious being banks and credit card providers charging “exchange rate loading fees” when making any type of transaction. The average fee is 2.60% on every purchase.
Consumers are also stung when making cash point withdrawals, with the average charge being around 2.31%. However, one of the main “stealth” charges you are likely to absorb is from the retailers themselves. An extortionate fee of over 4% is added to your bill through a process known as “Dynamic Currency conversion”. In essence retailers convert the transaction into sterling opposed to their local currency. Many consumers are completely unaware of this type of charging, and should be vigilant.
If you do intend on taking a credit or debit card abroad this year, do not rely on it as your primary source of finance. Instead take alternate forms such as local currency or specialist cards. Cards should only really be used in an emergency or when there is no other alternative.
