Prepaid cards prevent unexpected charges on holiday
Withdrawing cash abroad can hit holidaymakers with unexpected costs as banks implement debit and credit card charges but prepaid cards are being encouraged as an alternative.
According to a new survey, in total holidaymakers pay £260m each year for taking out cash on their credit and debit cards abroad.
Online travel agent sunshine.co.uk found in their survey that more than half had received a “nasty surprise” on the return from their holiday in the form of unexpected charges for the withdrawal of cash.
On average, tourists use their cards to withdraw cash five times at a cost of £2.75 on each withdrawal. As a result, bank charges averaged a cost of £13.75 to individuals per trip.
Co-founder of sunshine.co.uk, Chris Clarkson, said: "There's nothing worse than getting home from a nice relaxing holiday, which cost a fair amount to go on in the first place, only to be hit extra charges like credit card withdrawal fees.
"To avoid such a scenario, I would recommend making sure you have enough spending money to take with you and look into loading it up on to a prepaid card.
"Planning is key; work out how much you will need for the duration of your break and work out the pros and cons of various spending methods. Often, paying on card is a lot more reasonable."
The fees for using a debit card overseas were described as “extortionate” and complicated by a recent report from consumer watchdog Which?.
Some building societies and banks were charging a third more than others for foreign transactions.
Holidaymakers that are considering a prepaid cardon their holiday this year should research and compare the various cards available.
As a more cost-effective alternative, prepaid cards are expected to encourage holidaymakers to budget their holiday expenditure far more effectively, whilst avoiding unexpected card charges at the end of the month.