Exchange rate deals that can boost your holiday cash by £170
Tourists urged to shop around when buying foreign currency
- Study has found that exchange rates for dollars and euros varies incredibly widely between retail and online bureaux de change
- Holidaymakers could save up to £100.40 when purchasing €1,000 or £71.52 if buying $1,000 at the Best Foreign Exchange website
- The cheapest way to pay for goods or to withdraw cash in Europe and the US was with a credit card that does not charge for overseas transactions
Failing to shop around for your foreign currency and ways to pay on holiday could end up costing you almost £170, according to consumer watchdog Which?
Ahead of the Easter getaway, Which? magazine looked at how much better off holidaymakers could be if they chose the best currency and payment deals before, during and after their break. It found the exchange rates for dollars and euros varies so widely between retail and online bureaux de change that consumers could pay up to 10p extra on every euro and 7p for each dollar bought if they picked the wrong rate.
Its report also revealed that ordering online was the cheapest option for tourists looking to buy foreign currency.
Holidaymakers could save up to £100.40 when purchasing €1,000 or £71.52 if buying $1,000 at the Best Foreign Exchange website, compared with getting their money last minute at the airport. The report said: ‘Based on our average exchange rates, buying €1,000 would have cost £934.84 with ICE at Luton Airport.
‘Ordering online from Best Foreign Exchange for home delivery, the cheapest we found, would have cost just £834.44.
If you’re going to the US, you would have paid £683.71 for $1,000 at Manchester Airport Travelex, compared with £612.19 if you ordered your currency online from Best Foreign Exchange.
The survey also found that consumers could be stung by charges when paying abroad with credit or debit cards, with the worst offenders costing an extra 6p per euro or 5p for every dollar spent than the best deals.
The cheapest way to pay for goods or to withdraw cash in Europe and the US was with a credit card that does not charge for overseas transactions.
This saved £56.63 when spending €1,000 with a Metro Bank Card and £49.01 on $1,000 with the Post Office MasterCard, compared with using a Halifax debit card.
Which? also pointed out that it pays to shop around when returning your unused currency – the best deal saved £9.49 when selling back €100 and £7.10 on $100.
The report added: ‘You can pay for a guarantee with some providers so they will buy at the same rate they sold to you at, but they aren’t necessarily worth it as, after deducting the cost of the guarantee, we found you could get a similar amount of currency from other providers.’
It means that in total holidaymakers could save £166.52 if spending €2,000 – €1,000 before travelling, another €1,000 while abroad, and then returning €100 in leftover currency on their return.
For the equivalent on $2,000, the saving could be as much as £127.63, the survey found.
A Which? spokesman said that consumers should also remember that unlike other financial transactions, currency exchange is not regulated by the Financial Conduct Authority or covered by the Financial Services Compensation Scheme – meaning if a firm goes bust before delivering your order, you could lose your money.
Which? editor Richard Headland said: ‘Shopping around for currency before you go away will make your holiday money go further, so get online to find the best deals.
‘Once you’re abroad, you could easily waste around £50 if you use a credit, debit, or pre-paid card that has expensive fees.
We recommend switching to a lower-cost card, even if it is one that you get purely to use on holiday.’
For the research, the consumer group monitored exchange rates at 30 online currency providers, five UK airports and ten high-street outlets between January 29 and February 26 this year. It then used average rates over those weeks to work out the cost of buying €1,000 and $1,000. Halifax was not available for comment last night.