British banks scrap foreign currency exchange fees

Downwindz By Downwindz, 27th Dec 2011 | Follow this author | RSS Feed | Short URL http://nut.bz/2_8z.l3h/
Posted in Wikinut>Money>Travel & Transport

Travellers from the UK will get it easier looking through the bank fees on exchanging foregin currency

British banks scrap foreign currency exchange fees

Travellers from the UK will now get their foreign currency cheaper when they need to purchase it. This is because that 5 of the biggest British banks have decided to scrap the foreign currency exchange fees. This also includes some of the bigger credit card companies such as; Lloyds, RBS and Barclays .

The reason for scrapping the foreign currency exchange fees is based on a pressure from the Office of Fair Trading (OFT), and the companies have also promised to display more clearly which fees and other charges if any will be listed more clearly in the monthly statements.

It is estimated that the British population annually spend around £1 billion on exchanging money alone. This is made up from the charges for using debit and credit cards overseas. The fees were not only high but also very complex to look through for the average person, so the phrases the banks were using like “No Commission” or “Competitive Exchange Rates” were very misleading.

The price for the banks for processing bank transfers and credit card payments lies around 9p but the price charged to the consumer averages 37p, a big difference where the banks are pocketing the money. There are also charges on credit cards to buy foreign money, often this is a percentage rate of 1.5-2% of the total amount. This results in a fee upwards £60 to exchange £1000 worth of Euros.

The system has been changed because that banks and companies shouldn’t earn their money on fees and hidden commissions. They should rather earn their money through offering their customers the best service on the market, giving the most value for money. Hopefully the new changes will also reduce confusion about what charges apply to exchanging foreign money or using the credit cards abroad.

Tags

Barclays, Credit Card, Currency, Exchange, Foreign Currency, Office Of Fair Trading

Meet the author

author avatar Downwindz
I have a degree in Marketing Management and Economics and have a large interest in health and economical topics.

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Comments

author avatar Buzz
28th Dec 2011 (#)

Good information, downwindz. Thanks for sharing.

Happy New Year to you!

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author avatar Mikey.
28th Dec 2011 (#)

It seems an excessive charge,
Its good its gone.

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