Shopping around for currency makes good cents, says Which? Money
People looking to get a good deal despite the weak pound could make considerable savings by buying foreign currency from city-centre bureaux de change or online, rather than from the airport, travel agents and banks, says Which? Money.
[UKPRwire, Thu May 21 2009] The consumer watchdog checked exchange rates (http://www.which.co.uk/reviews/money ) when buying US $500 and €500 in cash at 21 currency providers* - including banks, bureaux de change, travel agents, the high street and online - on six different dates. It found costs varied by almost £50 between the least expensive and the most expensive providers**.
> The cheapest currency provider on average for US dollars and euros was Eurochange (http://www.which.co.uk/advice/how-to-cut-the-cost-of-your-holiday/exchanging-currency ) – it charged £351 for $500 and £461 for €500.
> The most expensive quotes were from an airport branch of Travelex, charging £40 more for $500 and £47 more for €500, on average.
> Airport bureaux de change such as TTT, American Express and Travelex provided the worst value for money, as they tended to charge for commission.
> The Post Office offered good deals for people buying currency online, but not for those buying from a branch.
Which? Money (http://www.which.co.uk/advice/how-to-cut-the-cost-of-your-holiday/exchanging-currency/index.jsp ) also found that using the wrong card for spending could be costly, as most card transactions abroad incur a ‘foreign exchange loading fee’ – typically between 2.75 per cent and 3 per cent – as well as a withdrawal fee for taking out cash.
Martyn Hocking, editor, Which? Money, says:
“The fall in the value of the pound has increased the cost of hotels, travel and entertainment for UK tourists, so it’s more important than ever to shop around for currency. Don’t just presume that high-street providers such as travel agents and the Post Office offer the best deals. Thinking ahead and changing your money before you travel means you’ll avoid getting stung at the airport – head to a city centre bureau de change or go online for the best deals”.
Which? Money offers people heading on holiday the following advice:
> Shop around for your travel insurance – there are some great deals available that could see you make significant savings***
> Tell your card provider when and where you’re going, or it may block transactions on your card
> Don’t use your credit card in a cash machine unless it’s absolutely necessary – the charges are often high
> Pay for currency in cash or on a Maestro card – that way you don’t pay the additional charges levied on Visa, MasterCard or Amex cards
> Don’t forget that sterling traveller’s cheques often impose a 1 per cent to 1.5 per cent commission charge
> Use a Best Buy credit card from The Post Office, Nationwide and Saga, which don’t charge for transactions in the EU, or a Nationwide debit card.
- Ends -
Notes to editors
Which? is the leading independent consumer champion in the UK, providing impartial, expert information on thousands of products and services to help make individuals as powerful as the organisations they have to deal with in their daily lives. To find out more go to www.which.co.uk.
The full article ‘Save up to £161 on travel money’ appears in the June 2009 issue of Which? Money magazine. A further article, ‘Notes from abroad’ appears in the June 2009 issue of Which? magazine. For further information, the full article, a copy of the magazine or an interview, please contact Helen Lacey.
For more information visit www.which.co.uk/money
Research notes
* Which? Money contacted 21 currency providers on six occasions over three months, and obtained currency rates from the big four banks as well as selected debit and credit card providers as part of its Eurozone currency rate experiment.
** Which? Money asked each provider to quote them for $500 and €500. In all cases Which? Money assumed that payments would be made with a Maestro card to avoid cash transaction fees imposed by other card providers.
Best and worst exchange rate providers for $500 and €500
AVERAGE COST FOR $500 AVERAGE COST FOR €500
Best deals Best deals
Eurochange £351.17 Eurochange £461.07
ICEa £355.36 ICEa £463.00
No1 Currency £355.56 No1 Currency £465.37
Sagaa £356.64 Post Officeb £466.22
Money Exchange £356.78 Sagaa £466.56
Post Officeb £356.97 Travelexb £466.84
Worst deals Worst deals
Thompson £368.42 Post Office Branch £480.78
Post Office Branch £369.06 First Choice £481.09
American Expressc £369.53 Thomson £482.87
TTTc £371.16 TTTc £484.31
First Choice £372.08 American Expressc £485.08
Travelexc £391.13 Travelexc £507.84
a Online with home delivery b Online with branch pick up c Airport bureau de change
*** Opting for a worldwide annual policy for an adult up to 64 years old from Best Buy insurer Familycare will cost £41 compared with £156 from RIAS – a saving of £115. For Best Buy tables, see page 13 of the June issue of Which? Money.
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