Cash is king for the modern traveller

The typical travelling Briton relies heavily on cash to pay his or her way whilst they are abroad, regardless of whether they are travelling on business or for pleasure, according to research by Santander.

The research reveals that just over half of all Britons (51%) travelled abroad in 2009 - and that just over half (52%) of these used cash for the majority of their purchases.   The next most popular methods for Britons travelling abroad were using the credit card (20%) and debit card (15%).  Perhaps, surprisingly, the once dominant traveller's cheque is now out of favour with only one in twenty (5%) using them - the same number that have a foreign currency account.

The research also reveals that the average spending money whilst abroad is £207 per person per week.   And, that almost half of British travellers (47%) withdraw three quarters of their weekly spend (£147) using an ATM machine whilst they were abroad.

Vim Maru, Director of Retail Products, Santander UK, said: "Some may find this research surprising - with so many Britons relying on cash when they are abroad - and the once ubiquitous traveller's cheque only as popular as the foreign currency account.    The reliance on cash does raise some concerns however: one is it safe to carry large sums of money; and, two, is cash the cheapest way to pay for items whilst out of the UK.

"Britons do believe that credit and debit cards do not get great rates of exchange, but this is simply not the case - the exchange rate on cards tends to be very close to the daily wholesale rates."

Compared to the top three choices for foreign spending, cash (52%), debit card (15%) and credit card (20%), almost nine in ten of Britons would save money by using a Santander Zero Current Account when travelling abroad.

Withdrawing money from ATMs abroad typically will incur the following charges:

Cash handling fee - 1.5% of the transaction (minimum £1.99); AND,
Foreign exchange fee - 2.75%

This means that if a Briton withdrawals the equivalent of £147 in foreign currency from an ATM abroad in one transaction - it will cost them £6.25 or as much as £8.02 if they do it in two transactions.

Santander calculates that if a family of four went on holiday for a fortnight - they would spend £16562, and that this could cost them as much as £73.64.

Vim Maru, continues: "Many are aware of the charges they face when using an ATM abroad, but are prepared to pay the charges for the convenience of easy access to cash, and the security of not having to carry large sums around.   However - it is not just ATM withdrawals where you can incur a fee.   If you use a debit card to purchase items in a shop or restaurant you will also incur a foreign exchange fee, as of course you will when exchanging money in the UK before travelling abroad.

"We have launched The Santander Zero Current Account for our mortgage customers to reward those customers that do more business.   The Santander Zero Current Account offers free ATM access around the world.  This is for withdrawals customers make using the Visa Debit card associated with the account.   There is also no foreign exchange loading charge and there will be no charges on the use of the Visa Debit card to make purchases world-wide.

"With so many using ATMs abroad and debit and credit cards to make other purchases, many people could save significant sums of money if they moved to Santander."

Santander Zero Current Account:

A current account for customers with an Abbey or Santander Mortgage who have their primary current account with Santander or switch using Santander's Account Transfer Service - this revolutionary account has no overdraft fees; fee-free foreign transactions and cash withdrawals worldwide and pays 6 per cent in-credit interest.