Question of the Week: Pay in Pounds or Euros?

MSE_Martin · 23 June 2009 at 11:27AM

Q. When using a credit card in Europe I was asked if I wanted to pay in Euros or Pounds. Is paying in Pounds better? Dave Walker, by email

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Martin's Pay in Euros or Pounds? Blog

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iyyahm · 24 June 2009 at 4:09PM

I live in London but come from Sweden. When I was paying for something at Selfridges with my Swedish card they didn't even ask me if I wanted to pay in pounds or Swedish krona, just just automatically took it in krona = a bad exchange rate for me, it made me so angry!:mad:

Skint_Catt · 24 June 2009 at 4:19PM

I've had a Nationwide Flexaccount for some years just for this reason (use it as a temp savings account at other times while I switch money around) but never got my head around whether it's better to withdraw cash from it or pay at restaurants and shops on it? Any ideas?
Thanks

ICATQ · 24 June 2009 at 5:45PM

I have looked at this and it has been better in the past to draw cash from an ATM in the local currency as the exchange rate is a bulk rate the banks get, which is sometimes better than the tourist rate.

Doesnt always work out but in my experience it is either the same as the tourist rate or better and that includes a transaction fee.

Cash advances against credit cards can, depending on your bank, be quite expensive and best avoided, use a debit card and there is no interest to pay on the cash advanced.

MrSmartprice · 24 June 2009 at 6:27PM

Skint_Catt wrote: »

I've had a Nationwide Flexaccount for some years just for this reason (use it as a temp savings account at other times while I switch money around) but never got my head around whether it's better to withdraw cash from it or pay at restaurants and shops on it? Any ideas?
Thanks

I don't think it matters as long as you don't let the bank or business do the conversion. Always ensure the amount charged to your Flexaccount is in euros (or whatever the local currency is). Nationwide get a far better rate when they do the conversion. I was offered 1.14euro/£ by an ATM in Spain last week. I declined and found that Nationwide had converted at 1.176/£, a difference of about £2.70 on £100.

richardbell · 25 June 2009 at 6:18PM

In my experience drawing cash in Euros has been cheaper. Obviously it depends where you are and what account you have but my Halifax account charges £1.50 for a Euro withdrawal but nothing if i withdrawer in £'s..

Also when abroad in Spain in April i used a Banca Marcha cashpoint and got a better rate than at home plus no foreign transaction fee..

MrSmartprice · 25 June 2009 at 7:06PM

richardbell wrote: »

In my experience drawing cash in Euros has been cheaper. Obviously it depends where you are and what account you have but my Halifax account charges £1.50 for a Euro withdrawal but nothing if i withdrawer in £'s..

Also when abroad in Spain in April i used a Banca Marcha cashpoint and got a better rate than at home plus no foreign transaction fee..

It should make no difference which bank's cashpoint you use if your own bank is doing the converting. We have used many different banks in Spain, France, Portugal and elsewhere, and every time the deduction is made in euros, then converted by the Nationwide at their commercial rate. As you state, the bank's rate is always better than what the exchange bureaux in the UK offer.

You

itsnever2lateisit? · 25 June 2009 at 8:38PM

On Tuesday I was in Sainsburys, Calais they were offering a rate of €1.05 for cash:mad:, or €1.14 for debit/credit card, now the spot rate Tuesday was around €1.175, so for folk using a card other than Post Office/Nationwide/Saga the sterling deal was probably OK

Bigger pitfall was the high prices they were charging whatever the currency

Question of the Week: Pay in Pounds or Euros?

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