With many escaping the unreliable British summer to soak up some sun on foreign shores, an increasing number will return to a nasty shock when their credit card bill arrives, according to a comparison website.
Online financial firm uSwitch has said that Brits will run up charges totting up to £422 million just from hidden charges for the privilege of paying by credit card whilst abroad.
Costs for accessing credit and debit card funds vary between providers whilst abroad, but around one in ten adults does not understand this according to the latest research. Around a fifth of holidaymakers plan on withdrawing money from foreign ATMs using their debit card but more than one in three – 38% – intend to use their credit card to cover the costs whilst abroad – even though this incurs a fee per transaction. Total credit card charges are estimated at being a whopping £186 million – the cost for simply handing over the plastic.
Despite the widespread use of credit cards whilst overseas only one in three Brits checks the best card to use.
Whilst using credit and debit cards is the safest, albeit more expensive option, even those who plan to pay for things the old-fashioned way and get their foreign currency before they travel may end up out of pocket. Sixteen per cent of those using currency never check that they are benefitting from the best exchange rate available and less than one in two makes sure that they are getting the best deal.
The finance expert from uSwitch, Stefan Maryniak, suggests that it is better to withdraw cash from a debit card rather than use a credit card, as not only are the fees higher, but interest starts to accumulate straight away. A good alternative is a prepaid currency card, which can be used like a credit card but often benefits from some of the best exchange rates on the market.