Travel agents and airlines are using the growing popularity of prepaid currency cards to launch their own – expensive – alternatives in an attempt to further boost profits.
Pre-paid cards have really taken off this summer as holidaymakers take to the idea of being able to buy their currency at a set rate before they go while knowing their plastic card offers more security than simply carrying cash. If the card is lost or stolen, money will normally be refunded by card issuers.
Ian Strafford-Taylor, boss of card-issuer FairFX, slammed those companies which he claimed are profiteering from currency cards.
"Some travel agents and airlines are profiting excessively by offering customers a prepaid travel card which offers poor exchange rates and often charges higher fees than some debit and credit cards. There are also often extra hidden charges in the terms and conditions," he said.
The FairFX boss said Ryanair is among the worst offenders, charging 5.75 per cent above the market exchange rate on every transaction abroad as well as above-average ATM fees.
He also highlighted Thomas Cook and Co-operative Travel as offering own-branded cards which contain hidden inactivity fees and worse exchange rates.
Mr Strafford-Taylor said: "Customers should compare rates on prepaid cards, not fall into the trap of paying well over the odds for what should be a way of saving money on their holidays."