Brits waste £100m a year on card charges abroad
Just over a third of holidaymakers (34%) use their debit and credit cards abroad and while 42% said they worry about the fees and charges, only half actually know how much they will be charged.
According to Thomas Cook’s first Holiday Report published today, this lack of awareness means consumers wasted £104m in fees and charges for using their plastic abroad last year.
Travel money seems to be the last thing on travellers’ minds as they book holidays a year in advance, yet less than half keep track of currency rates.
In fact, Thomas Cook’s poll of 2,635 customers found that a third use the pay day closest to departure to buy currency but thankfully, just 2% resorted to exchanging their money at the airport where its captive audience means poor rates.
The holiday provider also said it’s clear spending habits on holiday haven’t caught up with the way money is spent at home. Less than half of all consumer transactions are made using cash in the UK, according to Payments UK, but more than two in three holidaymakers like to take all the money they expect to spend in hard cash.
Take-up of pre-paid cards has been slow and while there are a number of versions on the market, only 13% said they use one, compared with 83% who take foreign currency in cash. Thomas Cook said “this balance needs to switch”.
Chris Mottershead, managing director at Thomas Cook UK, said: “British consumers have got much savvier in recent years about their spending – how to make the weekly food budget go further and using voucher codes for saving money on family days out. Our first Holiday Report has shown that this money-conscious mentality comes into play for the cost of the actual holiday but stops where spending money is concerned.
“It also reveals the stark lack of understanding when using credit and debit cards abroad. We know that for many a summer holiday is the most valued and important two weeks of a year.”
Travel Money golden rules
Thomas Cook has launched its ‘Six Golden Rules of Travel Money’ to offer simple and realistic ways to make holidaymakers’ hard-earned cash go further this summer:
- Never leave it until the last minute. The average spend on holiday for a family of four over two weeks is £1,000. How many other transactions of that size would you leave to chance?
- Check exchange rates a few months before departure. Save up and then buy when the rate is good. You can set alerts to your phone or computer and be notified when the rate gets to a certain level.
- Take a mixture of cash and pre-paid card – you’ll still need cash for the little things, like tipping, but most places take plastic.
- Use a pre-paid card as much as possible for point of sale transactions and ATM withdrawals – only use your debit / credit card as a last resort and always select to pay in local currency, never sterling.
- Minimise cash withdrawals – depending on the ATM, your bank and what currency you select, you could end up paying on average 2.73% in fees (and often an ATM fee).
- Buy attraction tickets in advance.