'Huge fees' for holiday makers using credit cards
Published On 10 April 2007
People from the UK who use their credit cards to purchase goods or services while on holiday could be incurring huge fees, a new report suggests.According to consumer switching service uSwitch, British credit card users will incur costs of £355 million this year when they use their cards abroad.
Credit card purchases while on holiday account for £204 million of the fees consumers will pay and £151 million of costs will come from withdrawing cash from foreign cash machines with cards.
Typically, UK credit card companies charge an 'exchange rate administration fee' of 2.61 per cent on credit card transactions in the US and 2.59 per cent in Europe. Similarly, companies levy an average fee of 2.30 per cent on cash withdrawals.
"There are several factors for consumers to take into account when using cards abroad," warned Nick White, director of financial services at uSwitch.
"Forward planning could avoid these charges altogether. In the long term, it may end up being more sensible for some consumers to have two separate credit cards - one for UK use and one for overseas."
Figures published earlier this year suggest that credit card use in the UK was increasing.
The data showed that people were typically using their cards for everyday purchases such as groceries.
