Credit card fees cost UK holidaymakers millions

UK travellers who are planning to use their credit card on holiday this year could be wasting hundreds of millions of pounds on unnecessary fees.

New figures from the Post Office show that 49 per cent of UK holidaymakers plan to use their credit card to shop abroad, accounting for an estimated spend of around £9.4 billion.

But people could be paying an extra £258 million in fees charged by bank and credit card providers.

The majority of credit cards typically levy a 2.75 per cent fee for each transaction made overseas. Yet half of all holidaymakers (47 per cent) have no idea about this hidden cost.

And over a third of credit card users (34 per cent) believe their provider does not charge a fee at all, despite there being only two credit cards on the market – including the Post Office credit card – that do not charge for overseas transactions.

18-24 year olds are the least likely to know if they are paying a fee.

Post Office head of communications Claire Oldstein said: “We are now four times more likely to spend on plastic abroad than 10 years ago. It’s shocking not only to see how much people are being penalised to use their cards on holiday, but how few are aware of this.

“We urge holidaymakers to check with their bank or credit card provider whether they will be paying a fee to shop overseas before they go. There are great value zero per cent deals available which can ensure you return home with only shopping bags and happy memories, and not a bigger credit card bill.”

Claire Oldstein added: “It’s not just credit cards that carry a fee when used abroad - we urge debit card holders to also check with their card provider whether it will cost them extra to spend on holiday.”

As the UK’s leading travel money business, the Post Office is always looking at ways to offer customers an even better deal on their travels.

As well as no commission charges, the Post Office credit card also has 0 per cent on balance transfers for the first eight months, zero per cent on purchases for the first three months and a lower interest rate of 6.8 per cent APR for bigger purchases.

Even after the promotional periods, the card still offers a competitive interest rate of 14.9 per cent APR typical (variable).