Every business that trades in foreign exchange will make money, so do not be fooled in to thinking you have a great deal. How they make money may be in the shape of a transaction fee, an reduction in the exchange rate, commission or flat fee. It is not always clear how they charge you unless of course you read the small print.

Euro cash before you travel

The high street – banks, post office or travel agents all offer ‘competitive’ rates on exchange rates. It may well be competitive compared to the other outlet in the same street but not necessarily the best competitive rate for you.  If you need to buy cash before you leave keep it to a minimum as the rates are usually much better at your destination.

Internet – you can purchase Euro currency on the internet and have the cash delivered straight to your door. Again, check the best rate and ensure you are not paying for delivery charges otherwise that bargain may not be such a bargain after all.

Using your Debit Card

Using your debit card at an ATM takes sterling directly from your current account at home and gives you European currency. You’ll pay fees, but you will need to check with your bank on what fees they will charge. Usually, a debit card transaction will incur £1.50 transaction fee and a reduced exchange rate of around 2 – 3%. If you plan on using your card in Europe it is good practice to notify your bank then they do not freeze or suspend your account due to unusual transactions. Also check the daily limit on cash withdrawals to make sure it covers your expected spending plans.

Using your Credit Card

Using your credit card at an ATM applies sterling directly on to your card statement and gives you European currency. You’ll pay fees, but you will need to check with your bank on what fees they will charge. Usually, a credit card transaction will incur £1.50 transaction fee, a reduced exchange rate of around 2 – 3% plus extortionist interest rate for them loaning you cash whilst overseas. If you plan on using your card in Europe it is good practice to notify your bank then they do not freeze or suspend your account due to unusual transactions.

Travellers Cheques

Old hat and a dying method, don’t bother.

Prepaid Currency Card

The modern travellers cheque that is widely accepted and easy to use. You load the card upfront with the desired currency at a fixed rate. Then either use the card to withdraw cash or pay for goods and services. Like all card there are charges, some cards charge a registration fee, some charge a transaction fee but the majority just incorporate a commission within the exchange rate.