CREDIT CARDS

Changes to travel money charges welcomed by experts

The announcement by the Office for Fair Trading (OFT) earlier this week, that banks should be clearer about their charges for foreign withdrawals, has been welcomed by industry experts.

Many high street banks have agreed to the changes, which also include scrapping charges for using debit or credit cards to pay for foreign currency.

Mark Bower, Managing Director at Moneymaxim, has called the charges unfair and misleading for consumers.

 “For the big banks these fees are not just a money earner in their own right, but they create an impression in customers’ minds that it’s not worth shopping around,” said Mr Bower.

“With such marked differences in the rates offered by both specialist money brokers and new entrants into the market like the supermarkets and those available from high street banks customers can make worthwhile savings on fairly modest sums.”

The move by the OFT follows a super-complaint by watchdog Consumer Focus, which claimed many banks were deliberately confusing customers over the cost of using their card abroad.

The OFT has said that the majority of banks have agreed to the changes. These include Lloyds, HSBC, Capital One, American Express and the Co-operative Bank.

For those wanting to pay for foreign money with a debit or credit card, there is a charge of between 1.5% and 2% levied by banks.

This changed will mean that it will be easier for consumers to compare rates and find the best deal possible.

 “Until now often the only way to avoid the charges was to use a hole in the wall machine to withdraw cash which can then be used to buy the currency, but this left little option but to cough up if you wanted to buy online,” Mr Bowen added.

“The changes also will make services such as the order and collect service companies such as Moneycorp offer through Gatwick and Stansted airports much more attractive.”

Tags: charges, CREDIT CARDS, debit cards, money, travel