Holidaymakers Waste Millions With Foreign Credit Card Charges

Published: 2 August 2010 By MoneyHighStreet Staff 2 Comments

Holidaymakers will spend an estimated £3Bn with their credit cards abroad between now and the end of the year, and many will incur needless charges totaling millions of pounds, research from Post Office credit cards reveals.

Departing on holidayIn the Post Office survey, more than half questioned said that they will be charged to use their credit cards whilst traveling abroad. With many credit card providers charging fees of up to 2.99 per cent shoppers abroad could be unknowingly adding pounds to every purchase.

Many people are not aware of the costs involved in using their credit cards for foreign purchases, however, and do not realise that there are ways of paying for goods and services on holiday without incurring unnecessary fees.

A growing number of travellers are using prepaid currency cards instead. These cards, which are an alternative to cash, are preloaded with a foreign currency before departure and then used in the same way as a credit card, but without the additional charges, when abroad.

Providers such as FairFx and CaxtonFX offer prepaid currency cards which can be used in ATM cash machines as well as at the checkout.

With a prepaid currency card your exchange rate is locked in at the time you add funds to your card – meaning you can do so now and take advantage of the strengthened Pound.

In contrast if you use such as a credit card, the exchange rate is the rate prevailing at the time of the transaction – plus invariably there are other charges such as a foreign exchange transaction fee, as the Post Office research has discovered.

Comments

2 Responses to “Holidaymakers Waste Millions With Foreign Credit Card Charges”
  1. Bill says:

    Agreed, there seems to be a general lack of awareness concerning credit card fees aborad. I would also encourage people to avoid using credit cards abroad and get a prepaid card. I switiched to my caxton fx prepaid card after I faced a hefty credit card bill from my holiday in Barcelona. Won’t be making that mistake again.

  2. Lucy says:

    I have had several discussion with my bank in the last months regarding the foreign exchange fees and commissions applied onto my credit card. Business trips resulted more expensive then I expected, but then I came across Caxton FX and this has all changed. I have a Euro card and I am very happy with it because charges and fees of using the card abroad are zero. My first payment choice when i am abroad.

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