We use cookies to allow us and selected partners to improve your experience and our advertising. By continuing to browse you consent to our use of cookies. You can understand more and change your cookies preferences here.

Coronavirus Read our latest advice

Nationwide hikes overseas card fees: how much will you pay?

Nationwide changes travel insurance and holiday spending terms

Nationwide hikes overseas card fees: how much will you pay?

Nationwide customers will pay more to use their debit cards on holiday, after the building society increased its overseas card fees.

It will also raise the maximum age limit for holidaymakers who can get travel insurance cover as part of its FlexPlus packaged account.

Earlier this year, Nationwide faced criticism after scaling back its telephone banking services and scrapping annual paper statements for savers.

Here, we look at Nationwide’s changes, who they affect and your banking options for the future.

Increased fees for holiday spending

As of Monday 8 October, Nationwide hiked fees on overseas debit card transactions from 2% to 2.75%.

How will this affect your holiday spending? As an estimate, on a €100 transaction (equating to £87 at today’s exchange rate), you’ll be charged £2.39 in fees instead of £1.74.

Cash withdrawal fees, however, remain unchanged at £1 on the FlexDirect, FlexAccount and FlexBasic accounts. Nationwide FlexPlus customers don’t pay a fee to make a withdrawal abroad.

A spokesperson from Nationwide said: ‘Nationwide regularly reviews its fees and charges and from time to time we have to make changes to ensure we can continue to run a fair and sustainable business.

‘We remain competitive within the market and members can continue to benefit from zero ATM usage fees abroad with FlexPlus, zero fees on purchases with the Select credit card, and zero overseas usage fees on the Youth products (FlexOne, FlexStudent and FlexGraduate).’

The best debit cards to use abroad

When it comes to debit card spending abroad, challenger banks may offer more attractive rates than their high street rivals.

Staling Bank, which offers an app-only current account, charges zero fees when you spend or take out cash abroad on your debit card.

Similarly, Monzo, another app-only challenger bank, offers fee-free spending overseas but has a cap of £200 on overseas cash withdrawals each month and a 3% charge after that.

Metro Bank’s current account offers the lowest rates on the high street.

The table below shows how the options compare for holiday spending in any European country.

Overseas card spending Overseas cash withdrawals Total cost on £500 spend in Europe (a)
Non-sterling transaction fee Non-sterling purchase fee Non-sterling transaction fee Non-sterling cash fee
Starling Bank 0% 0% 0% 0% £0
Monzo current 0% £0 0%(3% if over £200 in 30 days) £0 £1.50
Metro Bank current account 0% in Europe (2.75% outside Europe) £0 0% in Europe (2.75% outside Europe) £0 in Europe (£1.50 outside Europe) £0

(a) Five £10 card transactions, 10 x £20 card transactions, two £100 cash withdrawals and one £50 cash withdrawal

Travel insurance cut for older travellers

Along with the higher fees, Nationwide has also cut the upper age limit for the holidaymakers that can access travel insurance cover as part of the FlexPlus packaged account.

A packaged account is a bank account that comes with other goods and services like insurance and breakdown cover. You usually have to pay a monthly fee to hold one.

FlexPlus account holders, who currently pay £13 per month, can benefit from 3% in-credit interest, commission-free cash withdrawals abroad and worldwide family travel insurance.

But older customers may no longer be able to use the travel insurance cover. Previously, the policy extended to holidaymakers up to the age of 75, but Nationwide has confirmed that this age will be reduced to 70.

Eligible travellers above the policy age limit can buy a ‘policy extension’ to access cover. This feature, however, will become £15 more expensive, from £50 to £65.

Both changes will come into effect from 3 January 2019.

It comes as a blow for travellers over the age of 70, who often struggle to find travel insurance cover.

Nationwide told Which?: ‘As a result of increases in the cost of insurance, the amount the Society charges for the upgrade no longer covers the cost of providing the cover. We therefore took the difficult decision to reduce the maximum age on travel insurance.

‘This bring us in line with competitors offering travel insurance as part of their current account. However, most of our competitors who offer travel insurance as part of a package current account will cease cover at age 70 and do not offer an upgrade to extend cover into later life.’

If you’re an older traveller, it’s vital to shop around. You can read our guide on how to find travel insurance for over 65s.

Are packaged accounts worth it?

Packaged banks accounts, while offering additional attractive perks, may not always be the most cost-effective way of purchasing financial products.

Which? has analysed the value of fee-paying bank accounts for many years, and we’ve often found the same thing time and time again – you could often get the added benefits that come with your account cheaper elsewhere.

If you are considering whether you should open a fee-paying account, or you already have one, ask yourself the following questions to work out if you’re getting value:

  • How many benefits do you really need?
  • Do the insurance products give you the right level of cover>
  • Can I get any of these benefits cheaper elsewhere?

If you do a packaged account, you should be given notice of any changes as well as an eligibility statement to prompt whether the account is still worth paying for.

Check out our guide on the best packaged accounts for more help and tips.

Back to top
Back to top