It is always a notoriously expensive way of accessing your cash, but there could be a particularly nasty surprise at the ATM if you are taking out cash with a Fluid or Aqua credit card.
To take out the equivalent of £100 abroad, you would pay an extra £4.30 and £4 fee respectively, but this reduces the more money you take out.
However, with the same two providers, a £100 withdrawal would still end up costing you an extra £7.95 and £5 respectively, according to a Totally Money study.
Although high, Virgin Money is more expensive for larger withdrawals. The provider requires a 5% withdrawal fee and a non-sterling fee rate of 2.99%, adding up to £7.99 on the equivalent of £100 in your holiday destination of choice.
To withdraw the equivalent of £50, most providers will charge a similar amount, with an effective additional charge ranging between 8-9%. Withdrawing using a Fluid credit card represents a big jump compared to its rivals, with a 10.94% rate added onto your £50 withdrawal.
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‘Extremely costly way of funding your holiday’
Andrew Hagger, founder of Moneycomms, said: “Although credit cards give you financial flexibility and help you manage unexpected expenses, using them to withdraw currency at ATMs overseas can be an extremely costly way of funding your holiday spending.
“Consider a fee-free credit card or a low-cost debit card as an alternative if you don’t want to see a big chunk of your overseas holiday budget swallowed up by cash withdrawal and non-sterling charges.”
For the best and worst debit cards to use when spending your money on holiday, read the YourMoney.com guide to the leading providers.
Alastair Douglas, CEO of TotallyMoney, suggests doing your research before selecting your destination of how far your cash can go, as well as setting up a budget while you’re there.
He said: “Before heading off, double check if your bank charges you for withdrawing cash or paying by card.
“Some of the highest fees will come when you use a credit card at an ATM, and it will usually be most costly when taking out smaller sums of money. Some banks will charge £4 in fees when you withdraw the equivalent of just £10 in cash. So if you must use a credit card, consider withdrawing fewer and larger amounts.”
Douglas added: “If you can, always opt for a fee-free debit card. And whenever asked if you’d like to pay in pounds or the local currency, always pick the latter. That way you can avoid getting burnt by dynamic currency conversion fees too.”
