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Credit and debit cards used by 57% of Brits abroad

But are you using the right card overseas?


If you’re stuck abroad, EU airlines must cover accommodation and certain other reasonable expenses

British holiday makers are set to pay out £49m in unnecessary foreign exchange fees this summer, a survey has claimed – and all because they use the wrong plastic when paying for goods and services on holiday.

According to Santander, who conducted the research, Brits allocate themselves an average budget of £350 a week for holiday spending money; an increase of 28% compared with the average weekly spend in 2009.

57% of holidaymakers who go overseas are planning to use a debit or credit card abroad, with the average person putting 44% of their holiday spending on plastic.

Best credit cards for spending abroad

Unfortunately, the foreign exchange fees charged by most debit and credit cards could significantly increase costs for travellers who choose to pay this way.

Most credit card companies apply the following charges when you use your card overseas:

  • A foreign exchange ‘load’ fee of up to 2.75% of the sum spent, each time the card is used;
  • Interest charges from the moment cash is withdrawn on the card, often at rates of up to 30% APR – even if the card balance is paid off in full before the end of the month;
  • A cash withdrawal fee of around 2.5% (or £3) when you take money out of an ATM using your credit card, in addition to the load and interest charges.

As you can see, taking money out of a hole in the wall using your credit card is the worst way to use it on holiday – so Which? researchers recommend you avoid this at all costs. The only way to avoid the foreign exchange ‘load’ fee is to use a credit card that doesn’t charge you extra for overseas transactions.

Which? credit cards expert Martyn Saville says: ‘Santander’s research shows that using costly credit cards for spending abroad could eat into your holiday budget, without you even realising it – so it’s crucial to pick the right plastic for foreign transactions.

‘The Post Office Platinum MasterCard is a good choice because it combines a 0% foreign exchange fee and we’ve had good feedback on the Post Office’s customer service from our members.’

For a look at all the credit cards Which? rates for overseas spending, see the Travel Money advice guide.

Using your debit card abroad

Meanwhile, using your debit card on holiday could be just as costly as spending on some credit cards:

  • Whether you withdraw money or spend it over the counter, you’ll be charged a foreign exchange ‘load’ of around 2.75% – just as you would be for spending on a credit card;
  • If you take money out at a cashpoint, a cash withdrawal charge of around 2.5% (or £3) is likely to apply;
  • Some debit card providers – such as Halifax, RBS, NatWest and Lloyds TSB – also add an extra ‘penalty fee’ every time you use your card abroad. This means making a succession of transactions in shops or at cashpoints, even for tiny amounts, could end up costing you a small fortune.

Which? experts recommend the Nationwide FlexAccount Visa debit card for use abroad because it doesn’t charge customers an extra fee when it’s used within other European countires. Elsewhere in the world a 1% fee applies to foreign transactions.

Get a great deal on travel money

Using the right credit card abroad could be the cheapest way for you to spend while on holiday. Furthermore, using a credit card to pay for certain goods and services relating to your holiday will give you extra protection under Section 75 of the Consumer Credit Act

However, plastic isn’t the only option if you’re looking to get great value travel money; ordering foreign currency online is quick, easy and secure, and often means you’ll benefit from a better exchange rate than you’d get in a high street bureau de change.

Read our comprehensive Travel money guide for advice on making the most of your holiday cash, whichever way you intend to spend.

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