Travel Money: Fees, Commission, And Hidden Costs >:(
After jumping through many hoops (because we’re not on the polling database yet—I had no idea that registration is linked to credit rating, but it is now), we’re finally about to receive our travel currency cards. Caxton FX have a reasonable, commission-free service (although the exchange rates may not be the most favourable) and do not charge ATM fees when used abroad.
But no sooner did I rejoice than I found out that the Thai government is imposing a whooping 150 Baht (3 quid) fee on all foreign card ATM withdrawals.
From what I’m reading right now, the Government Savings Bank may impose a lower fee, but there are many hidden costs in addition to that. So when it comes to travel money, it pays to pay attention. Here’s a list of what to look out for when shopping for a travel card:
Is there an application/card fee? A lot of operators charge, usually in the region of 10 quid. Look out for free promotions.
Is there a fee for topping up? Incredible though it sounds, there often is. The Post Office deserves special mention for charging commission on loading the card with sterling because it’s managed by the Bank of Ireland, which uses Euros.
Is there a monthly fee? This quickly went out of fashion when comparison sites became prominent, but some operators still charge for cards that haven’t been used in a while.
Is there an ATM withdrawal fee? There usually is. Here’s where Caxton FX wins out over Fair FX, and their exchange rate is still better than that of many banks.
Is there a commission? This can be as high as 2.75%!
What is the exchange rate? See above. The Post Office is pretty dismal. As if this isn’t bad enough, there is a new ruse called Dynamic Currency Conversion (DCC), in which you will be offered to pay in sterling rather than the local currency. The exchange rate will then be ramped up by the local bank/retailer. If you want to take advantage of the favourable exchange rate provided by your card operator, always pay in the local currency. [EDIT: these days customers are often asked whether they want to accept a given exchange rate instead. Always decline!]
[EDIT: revise this and reserve judgement: exchange rates for Thai Baht quoted in the UK are typically 5% lower than those quoted in Thailand! See next post]
A good overview can be found here.
In summary: in addition to card application/management fees, a 100-quid-equivalent ATM withdrawal can cost you:
- A couple of quid on a bad exchange rate*,
- £2.75 commission
- £1.50 bank ATM charge
- £ 3.00 (ca.) government charge
*(There is some confusion here. Caxton says their rates are fixed at 2.5% Interbank rate, but there is a listed foreign exchange fee of 2.5% on some sites. Does this apply to the exchange rate @ 2.5% below Interbank or is this an additional fee?)
—In short, enough to pay for a room, perhaps with dinner thrown in.
The 150 baht would still buy dinner for two, though >:(
Tags: Money, Travel, travel cards, travel money, Tag Index
Denni