The Charge for Using a Credit Card Abroad Soars

Higher Card Fees for Those on Holidays Abroad

Jun 21, 2009 Asa Ghaffar

Considering a holiday abroad? UK holidaymakers face a fresh wave of card fees when using their credit cards abroad as banks seek to cash-in.

UK holidaymakers' now face a fresh wave of card fees when using their debit or credit cards abroad. uSwitch.com claim that £22.4 billion will be spent on overseas credit transactions during 2009. This comes after British taxpayers have had no option but to pay for the incompetence and inherent greed of banks. It is important to be aware of the costs of credit transactions before buying abroad.

How Much Does Using a Credit Card Abroad Cost?

The overwhelming majority of providers are now charging a card fee for using a debit or credit card abroad. Whilst Abbey National and Royal Bank of Scotland each charge £1.25, Halifax charges as much as £1.50 for each credit transaction. Louise Bond, of Uswitch said: “With an average charge per debit card purchase of £1.13, netting the industry £148 million per year, more and more providers look set to jump on this lucrative bandwagon.”

Banks Cash-in on Overseas Credit Transactions

Nationwide once advertised the fact that card fees wouldn't be charged to customers when buying abroad, but even they have started to cash-in on credit transactions outside of Europe. Latest figures from Uswitch.com show that UK holidaymakers' will now be charged a 3% fee for using their credit card abroad. International credit transaction fees are due to net the banks approximately £754 million this year, representing an increase of 6% compared to 2008.

What Are the Fees on the Use of Credit Cards Abroad?

Lloyds TSB - 2.95%

Halifax - 2.95%

Barclaycard - 2.75%

Thomas Cook - 2.5%

Nationwide - 1% (from July 2009)

Post Office - Free

As it stands, the Post Office is the only provider not to impose card fees for either overseas credit transactions or cash withdrawals from an ATM. UK holidaymakers are advised to use the free service of the Post Office to encourage other financial institutions to amend their policy.

Credit card fees have already increased costs for UK holidaymakers'. Factor-in these costs when picking up a bargain or considering switching to the Post Office. If making a withdrawal from an ATM, make a larger withdrawal to minimise fixed card fees. This is clearly preferable to making a succession of small withdrawals.

Readers may also be interested in finding out how to prevent online fraud or reduce credit card debt. Others may wish to assess the merits of using a credit card.

Sources

Colman, Elizabeth. (April 6, 2009). "Holiday card charges soar: Consumers face a huge increase in credit card fees." The Times.

Disclaimer: This article in no way attempts to give legal or tax advice. One should consult a licensed attorney, tax advisor, or other qualified professional.

The copyright of the article The Charge for Using a Credit Card Abroad Soars in Personal Budgeting/Finance is owned by Asa Ghaffar. Permission to republish The Charge for Using a Credit Card Abroad Soars in print or online must be granted by the author in writing.

Considering Using a Credit Card Abroad?