LONDON, May 21, 2024 /PRNewswire/ -- The 'shoulder
season' is upon with double the number of Brits expecting to travel
this May and June to save on high season costs. However,
budget conscious Brits defaulting to debit cards abroad could be
stung by an extra £32.32 bill reveals research by payments firm
Caxton.
This is due to card fees banks impose on customers who pick the
wrong plastic to use overseas – with charges of up to 2.99% for
each overseas transaction, and 4.75% for getting cash.
Calculating these fees against new holidaymaker data on summer
spending and ATM use, consumers could waste an average of £32.32
per trip on charges1. With 19.4 million foreign holidays
taken by UK residents between July and September last year, Brits
following suit could face a bill of £627m this
summer2.
The tourist 'tap'
Caxton research shows Brits make an average of 19 card
transactions overseas, typically spending £32.33 per
tap1. During their trip they'll take money out three
times, withdrawing around £150 each time1.
In the UK, debit cards account for half of all payments made,
with contactless methods surging by 30%3. Using these
cards abroad can become an unnecessary holiday expense.
Toll in the wall
Most high street banks charge for using their standard debit
cards overseas as a cost for converting the money from pounds into
a foreign currency.
This conversion fee typically applies to both spending and
taking out cash abroad with a debit card. However, for ATM use HSBC
also adds on a 2% non-sterling cash fee for standard account
holders, meaning customers will be charged 4.75% of the amount
withdrawn.
Although the number of foreign holidays Brits took rose 12% last
summer, the research showed the typical card use per person had
fallen year on year, with purchases down 10% and spend per
transaction down 2%4 5. Over the same period the average
amount UK consumers withdrew from cashpoints was up by 17%, while
the number of ATM withdrawals per trip dropped 7%, suggesting a
greater focus on budgeting and fewer impulse buys.
Caxton Chief Operating Officer, Alana
Parsons commented: "When you're abroad it's easy to
let your guard down when it comes to bank card fees. We've become
used to making quick taps with our cards, so it's understandable
why many people continue to do so on holiday.
"However, this leads to needless charges. To break the habit –
and hold onto your hard-earned cash – get a currency card for
holiday spending. Having a separate card will help you budget and
can also be pre-loaded with the money you need – so you can relax."
Notes to Editors:
Download full release and figures
1 Caxton researchers analysed 1,249,798 foreign
currency transactions made by 64,737 consumers and 81,751 overseas
ATM withdrawals made by 27,922 consumers between July and
September
2023; These figures were used with the high
street bank debit card fees to calculate the average bill of using
a high street debit card overseas Contact
marketingteam@caxton.io for the full analysis
2 ONS: Overseas travel and tourism: July to
September 2023; 19.4 million x £32.32
= £627,008,000
3 UK Finance: Half of all payments now made
using debit cards
4 ONS: Overseas travel and tourism: July to
September 2023
5 Caxton 2023 research showed average amount
withdrawn at overseas ATM from July to September 2022 = £126.63; Average count
withdrawals = 3.16
About Caxton
Caxton is an award winning fintech payments company which processes
tens of millions of international and domestic transactions each
year. Website: https://www.caxton.io/cards
Photo -
https://mma.prnewswire.com/media/2417115/Caxton_Travel_Card.jpg
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