Most people hate banks. It’s like the tax people, politicians and traffic wardens. I actually quite like mine since they call me up and ask me how I am, and once refunded £50 on my say so when I forgot to take the proffered cash from the ATM and some ratbag pinched it. As such, for a while, I loved them.
What tempered my passion though are those nasty little (and sometimes not so little) charges that get added when you use your cards abroad. I understand that banks need to make money but these mysterious charges are, I feel, underhand and sneaky. Since we are all electronically connected, why is it more expensive to take my money out of an ATM in Calais which is only a few miles from Dover? After my usual careful research, I have concluded that that’s just the way it is. But can we get round it?
Using your debit card
Like most people, I’m used to my debit card being the “free” way to pay. I can take cash out in the UK without paying a charge and buy things in shops. Additionally, it’s usually the cheaper option when booking train tickets or flights. Unfortunately these rules don’t follow when you need cash for a night out in Ibiza or are buying souvenirs in Paris.
Debit cards – cash withdrawals
Here you can get hit with a Cash Conversion Charge which is typically 2.75% of the amount you take out and then perhaps a Cash Withdrawal Charge which is usually between 1.5 – 2% but often with a minimum of around £2.
This means using my Natwest debit card to withdraw £100 worth of Euros, would cost me £104.75. If I made the mistake of taking out a series of small amounts, say £10, I could be paying £2.28 each time.
Debit cards – buying things
The Retail Conversion Charge is, again, around 2.75% of the amount that you spend on the card.
You could also then get nailed with a Retail Transaction Charge which for Natwest is a flat fee of £1.25 or is a percentage with other institutions.
There currently is a solution to these charges though and that is why I have a Nationwide BS FlexAccount – specifically for holidays. The Nationwide levy none of the charges above and it does not need to be my main current account. For once, a simple financial answer and now I love Nationwide more.