GE 3% Cashback - Statements

Arkad

Very pleased with my card. Saved me a few bob on what I would have bought anyway. Not recieved my statement yet but I don't tend to get it until the end of the month anyway.

Stompa

Hmmm, I've just noticed that it's possible to pay council tax by credit card - not sure whether I can be bothered to change my existing DD arrangement though!!!

King_Of_Fools

JMcC wrote:

Good news again. 3% on everything, including spend in euros.
I have not been charged anything for using the card abroad and the exchange rate looks good. I actually got a slightly better rate on the card than I got from travelex for cash (and that was the best rate I could find).

Yes, the credit card rates are always better than the best tourist rates - even when the card company loads the 2.75% into the transaction (which is what happened to you - the fee is not itemised seperatly).

The rate you got would have been 2.75% worse than you could have got from Nationwide or the Post Office cards. However, as you also got 3% cashback applied you were actually 0.3325% better off!

(Of course, if you would have hit the £5000 yearly limit with just UK spending you would have been better off overall using a Nationwide or Post Office card abroad with no cashback and getting the full 3% in the UK on your GE card.)

JMcC

Thanks for that response.

However, looking at the statement, the transaction cost has remained unchanged. For example, I paid 110.42 euros for one item. I have the receipt and that is exactly what I paid. The price would have been that had I paid cash or card.

The exchange rate quoted for that transaction was 1.4466 EUR/Sterling and the UK Amount is £76.33.

Given this, where has the 2.75% been loaded ?

It looks to me like if any fee has been paid, it is put onto the retailer, since the cost would have been the same whether I had paid with cash, or by card.

Am I missing something ?

thumshie

The exchange rate quoted for that transaction was 1.4466 EUR/Sterling and the UK Amount is £76.33.

GE will have pre-loaded this rate. if you look at the current rates http://newsvote.bbc.co.uk/1/shared/fds/hi/business/market_data/currency/11/12/default.stm

It's going for 1.48890. GE will-for a transaction posted today quote on the statement the exchange rate was 1.4479-taking their 2.75%

*Edit* Note this is still better than the rate going into an exchange, travelex would only give you a rate of 1.4401 today, Thomscook is 1.41.

JMcC

Thanks, I understand.

However even with that, I was still better off than using cash.

The exchange rate I got from Travelex was E1.4251. Yet the exchange rate used by GE was E1.4466. Remember that the Travelex rate was the best I could find.

It's possible that the rate altered in the week between buying cash and using the card.

Is there any way to be sure what the official rate was on the day I made the transaction ? The transaction date was 21/09/06. I am going to have a look in the Travelex site to see if I can get the rate on that date.

JMcC

I now understand.

I checked the Travelex historical rate and it told me that the rate was E1.4411, still not as good as the 1.4466 I got from GE (even although they had loaded the rate by 2.75%).

Bottom line is that the rate would have been even better had I used a Nationwide or Post Office Card (that is correct isn't it ?).

However it still makes sense to use a card, since the rate is better than I can get when exchanging cash. Plus of course I got 3% cashback.

thumshie

Thats their historical value..

try http://www.oanda.com/convert/fxhistory for interbank rates
1.4859

Yes, Nationwide would have given you close to the above i beleive, and your 3% makes the effective rate something like 1.489998. Just hope GE don't try clawing back once they 'fix' their systems..

King_Of_Fools

JMcC wrote:

Bottom line is that the rate would have been even better had I used a Nationwide or Post Office Card (that is correct isn't it ?).

However it still makes sense to use a card, since the rate is better than I can get when exchanging cash. Plus of course I got 3% cashback.

Yes and yes!

Using a credit card abroad will always give you a better rate than exchanging money even when the rate is loaded. If you want foreign cash then you will also get a better rate (the same as the credit card) by taking it out of an ATM using a cash or debit card.

When I go abroad I exchange a small amount of cash using Travelex so I have got some for when I first get there. I then try to put as much spending as possible on my Nationwide credit card and if I need any more cash I can get it out of an ATM using my Nationwide cash card. I make sure that I never have any cash left over so that I have to exchange it back to sterling as that is where you really get a bad rate!


If we take the Euro exchange rate for today (Thursday 26th October 2006) as a case example:

Visa exchange rate - 1.49
Travelex sell rate - 1.4401
Travelex buy rate - 1.6027

Non-fee card rate - 1.49
2.75% fee card rate - 1.4490

So If I were to spend €500 on holiday it would cost the following using these methods:
Non-fee card - £335.57
2.75% card - £345.06
Travelex - £347.20
Travelex (exchanging €1000 but returning €500) - £382.42

JMcC

I completely understand. Thanks very much to you for explaining so well.

My intention now is to

1. Keep an eye on the GE card to watch when getting close to £5K (to try to optimise spend to £5K)
2. I travel a reasonable amount, so it is probably worthwhile applying for a Nationwide card. I'll use this for foreign spend since it is for sure the best method (I didn't realise there was as much as 2.75% lost on the exchange rate)