Going Abroad This Summer? How to Avoid Losing Money on Travel Cash
School holidays mean millions of UK travellers are about to hand over money to whichever card, app, or currency desk happens to be nearest — and some of those options are far more expensive than...
School holidays mean millions of UK travellers are about to hand over money to whichever card, app, or currency desk happens to be nearest — and some of those options are far more expensive than others. A little preparation before you leave can save real money on every transaction abroad.
Why your everyday debit card can cost you
Many high-street bank debit and credit cards still charge a non-sterling transaction fee, typically around 2.75–3%, on top of a foreign cash withdrawal fee, according to guidance from Which?. On a typical £1,500 family holiday spend, that can easily add £40–£50 in hidden charges compared with a fee-free alternative — money that buys nothing extra.
Airport currency exchange is usually the worst deal
Currency bought at airport exchange desks routinely carries the poorest exchange rates on the market, as flagged repeatedly by MoneySavingExpert. If you need cash, order it online in advance from a reputable provider and collect it, or use it delivered — rates are almost always better than walking up to a desk on the day.
Fee-free cards have become the easy win
A number of UK current accounts and prepaid cards now offer no foreign transaction fees and fair exchange rates on spending and withdrawals abroad, a shift driven partly by challenger banks and partly by competitive pressure on incumbents, per coverage from MoneySavingExpert's travel money guide. Getting one set up before you travel — rather than scrambling at the airport — is the single biggest lever most travellers have.
Checklist: sorting your holiday money before you go
- Check whether your everyday debit or credit card charges a non-sterling transaction fee — look in your bank's fees and charges document or app.
- If it does, consider opening a fee-free alternative at least two weeks before travel, so the card arrives and is activated in time.
- Order any physical foreign cash online in advance rather than at the airport — compare rates across at least two providers first.
- Notify your bank or card provider of your travel dates to avoid transactions being flagged and blocked as suspicious.
- Take a backup payment method — a second card or a small cash reserve — in case one card is lost, blocked, or not accepted.
- Check whether your destination is primarily card-friendly or cash-reliant; some regions and smaller businesses abroad still expect cash.
- If withdrawing cash abroad, always decline "dynamic currency conversion" (being offered the choice to pay in pounds) at the ATM or terminal — paying in the local currency and letting your card provider convert it is usually cheaper.
- Keep a note of your provider's emergency contact number in case your card is lost or stolen while abroad.
How this compares internationally
Currency conversion fees and practices vary by market. In the European Union, cross-border payment regulations require that currency conversion costs be disclosed clearly before a transaction completes, giving travellers a chance to decline unfavourable conversion offers. In the United States, the Consumer Financial Protection Bureau has flagged foreign transaction fees on credit cards as a common but often avoidable cost, encouraging consumers to check card terms before travelling.
Key Numbers
- 2.75–3%: typical non-sterling transaction fee on standard debit/credit cards
- £40–£50: potential hidden cost on a £1,500 holiday spend using a fee-charging card
- 0%: fees charged by a growing number of fee-free travel cards, per MoneySavingExpert
Sources
Educational content only — not financial advice.