Holiday Money: Play your cards right on holiday

Access, Visa, Eurocard - which offers the best deal abroad? By Stephen Spurdon

The excitement of taking a holiday usually means we do not think any further than tripping off to the bank or building society for foreign currency and travellers' cheques, confident that Visa or Access cards will pay for the odd present or meal.

There are, however, alternative ways of paying for that all-important spending spree abroad.

Those holidaying in Europe and looking for an alternative to credit cards can use Eurocheques instead. For a fee, you can obtain a Eurocheque guarantee card with the EC logo on it and a cheque book that allows you to write cheques in local currency against your UK current account.

Eurocheques can be used throughout Europe, and the guarantee cards can usually be used as debit cards and to make withdrawals in local currency from cashpoint machines.

This should be thought of as part of your holiday finance alongside travellers cheques, foreign currency and credit cards.

As can be seen from the table below, however, Eurocard charges vary. The Royal Bank of Scotland Eurocard appears expensive at pounds 12, but is for two years, so it actually costs pounds 6 a year.

On the same basis, Lloyds card is cheapest at pounds 4.50 a year. Cost per transaction is usually 2 per cent, with NatWest charging the highest rate shown at 2.25 per cent.

The minimum cost per transaction, however, is worth watching as well: the Midland's pounds 1 minimum being the least. Royal Bank of Scotland is the only one to mention a maximum charge, which in its case is pounds 4.

In France, however, an alternative method of payment should be taken, says Lloyds bank, as Eurocheque encashment by French banks is limited.

One of the bugbears of using standard credit cards abroad is the unpleasant discovery that sudden currency exchange rate movements mean the lederhosen that seemed a bargain in Berlin are no longer cheap because the Deutschmark has risen massively against the pound.

In foreign exchange markets, currency transaction rates for credit cards are set by Mastercard and Visa and the same rates apply to every card issuer.

It is important to realise that the card issuer has also loaded on a further charge - commission levied on the currency exchange itself.

This means you might pay more than you should if you use the wrong card abroad. For instance, Barclaycard charges 2.65 per cent, Midland 3.25 per cent and NatWest 2.75 per cent.

Credit cards from Frizzell Bank do not impose this extra charge. This bank is part of the Frizzell group of companies, which is mainly known for its activities as an insurance broker and is now owned by Liverpool Victoria friendly society.

You do not have to be a client of the bank to get the cards and the charge of pounds 11 a year includes both Visa and Mastercard versions. The current APR is 16.1 per cent .

Taking a charge of around 2.5 per cent for currency exchange, if you spend pounds 400 on a holiday using Frizzell cards, you will have saved pounds 10, itself nearly the equivalent of the annual charge. Bear in mind that many other card issuers also levy an annual charge.

Des Benjamin, director of customer services at Frizzell Bank, says: "We have retired people taking long holidays abroad who load their cards up with cash from a deposit account. We pay 3 per cent on credit balances. So you have easy access to cash and the facility to get local currency from a cashpoint machine.

"We have the standard 1.5 per cent cash charge for such transactions. People can also arrange to pay off the entire balance by direct debit from their current account in the UK."

This could be useful if, for instance, you are planning a longer trip.

SELECTION OF EUROCHEQUES COSTS AND RATES

Bank Cost of card Cost per transaction

Barclays pounds 8 a year 2%. Minimum pounds 1.75 for ATM,

pounds 2 for cheque

Lloyds pounds 9 for two years 2.5%. Minimum pounds 2

Midland pounds 7.50 a year 2%. Minimum pounds 1

NatWest pounds 8 a year 2.25%. Minimum pounds 1.50

Royal Bank

of Scotland pounds 12 for two years 2%. Minimum pounds 1.75, Maximum pounds 4

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at VouchedFor.co.uk

Finacial products from our partners
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    SThree: Experienced Recruitment Consultant

    £20000 - £40000 per annum + OTE + Incentives + Benefits: SThree: Established f...

    SThree: Trainee Recruitment Consultant

    £20000 - £25000 per annum + OTE 40/45k + INCENTIVES + BENEFITS: SThree: The su...

    Recruitment Genius: Collections Agent

    £14000 - £16000 per annum: Recruitment Genius: This company was established in...

    SThree: Trainee Recruitment Consultant

    £20000 - £25000 per annum + OTE 40k: SThree: SThree are a global FTSE 250 busi...

    Day In a Page

    Refugee crisis: David Cameron lowered the flag for the dead king of Saudi Arabia - will he do the same honour for little Aylan Kurdi?

    Cameron lowered the flag for the dead king of Saudi Arabia...

    But will he do the same honour for little Aylan Kurdi, asks Robert Fisk
    Our leaders lack courage in this refugee crisis. We are shamed by our European neighbours

    Our leaders lack courage in this refugee crisis. We are shamed by our European neighbours

    Humanity must be at the heart of politics, says Jeremy Corbyn
    Joe Biden's 'tease tour': Could the US Vice-President be testing the water for a presidential run?

    Joe Biden's 'tease tour'

    Could the US Vice-President be testing the water for a presidential run?
    Britain's 24-hour culture: With the 'leisured society' a distant dream we're working longer and less regular hours than ever

    Britain's 24-hour culture

    With the 'leisured society' a distant dream we're working longer and less regular hours than ever
    Diplomacy board game: Treachery is the way to win - which makes it just like the real thing

    The addictive nature of Diplomacy

    Bullying, betrayal, aggression – it may be just a board game, but the family that plays Diplomacy may never look at each other in the same way again
    8 best children's clocks

    Tick-tock: 8 best children's clocks

    Whether you’re teaching them to tell the time or putting the finishing touches to a nursery, there’s a ticker for that
    Isis profits from destruction of antiquities by selling relics to dealers - and then blowing up the buildings they come from to conceal the evidence of looting

    How Isis profits from destruction of antiquities

    Robert Fisk on the terrorist group's manipulation of the market to increase the price of artefacts
    Labour leadership: Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea

    'If we lose touch we’ll end up with two decades of the Tories'

    In an exclusive interview, Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea
    Tunisia fears its Arab Spring could be reversed as the new regime becomes as intolerant of dissent as its predecessor

    The Arab Spring reversed

    Tunisian protesters fear that a new law will whitewash corrupt businessmen and officials, but they are finding that the new regime is becoming as intolerant of dissent as its predecessor
    King Arthur: Legendary figure was real and lived most of his life in Strathclyde, academic claims

    Academic claims King Arthur was real - and reveals where he lived

    Dr Andrew Breeze says the legendary figure did exist – but was a general, not a king
    Who is Oliver Bonas and how has he captured middle-class hearts?

    Who is Oliver Bonas?

    It's the first high-street store to pay its staff the living wage, and it saw out the recession in style
    Earth has 'lost more than half its trees' since humans first started cutting them down

    Axe-wielding Man fells half the world’s trees – leaving us just 422 each

    However, the number of trees may be eight times higher than previously thought
    60 years of Scalextric: Model cars are now stuffed with as much tech as real ones

    60 years of Scalextric

    Model cars are now stuffed with as much tech as real ones
    Theme parks continue to draw in thrill-seekers despite the risks - so why are we so addicted?

    Why are we addicted to theme parks?

    Now that Banksy has unveiled his own dystopian version, Christopher Beanland considers the ups and downs of our endless quest for amusement
    Tourism in Iran: The country will soon be opening up again after years of isolation

    Iran is opening up again to tourists

    After years of isolation, Iran is reopening its embassies abroad. Soon, there'll be the chance for the adventurous to holiday there