Commission-free packages can often mask poor rates of exchange so shop around, something less than 50% of holiday makers bother to do. It can save them €30 on a €500 transaction.
Look at the total cost of your transaction, including commission, exchange rate, handling fee and delivery of their money to your home, Don’t leave your currency until the airport or hotel at the other end. You can end up leaving 10% of your holiday cash behind the counter. This makes little sense when some providers charge up to 2% commission (with a minimum of €7.50 payable) plus a handling charge of more than €7.50.
Plastic
Plastic offers best value so use your credit card for as many transactions as possible. But beware of protection issues. While seven in ten consumers use their credit card while abroad, more than two-thirds do not know how much they are charged for doing so. Irish banks are among the highest charging in the world. They apply a currency ‘loading’ fee of at least 2.75% on all purchases overseas - whether with debit or credit card. They even continued to apply it within the euro zone for a while. And if you use
your card at a foreign ATM, there is usually an extra handling fee of up to 2% of the transaction value.
Not only do you pay a higher rate of interest on credit card cash withdrawals, but there is no ‘interest-free’ period - so you start paying immediately for the privilege of borrowing.
Travellers Cheques
Travellers Cheques haven’t gone away either, you know. A new innovation is a prepaid, re-loadable traveller’s cheque card, launched recently by American Express, MasterCard and Travelex. Customers simply load the card with their chosen currency in advance, and are then given a Pin code to get hold of their cash from an ATM or to use in-store. Lose your card and the balance is intact on a replacement because it is not linked to your bank account. However, the card has a fee and a reload charge.
Be prepared to retrieve all your information at short notice if things actually do go wrong. In case things go wrong, leave photocopies of your passport, European Health Insurance Card, driving license, insurance policy and itinerary with family or a friend.
Bon voyage.
