Most efficient way of extracting cash abroad

stilltheone

benjus wrote: »

An FX transaction can be considered free if you would get the same amount you started with after converting it and then converting back again.

i.e. if you could do 100 GBP -> XXX EUR -> 100 GBP

Which means that you would need to get the market mid rate in each direction.

Obviously you can't do that in real life, but we're only interested in the GBP -> EUR part, so if we can do that at the market mid rate, it's effectively free. If we can't do it at the market mid rate, we can measure the difference to see how much the transfer is costing us. This approach works whether you are using these cards or changing money at the Post Office.

oanda is a convenient place to source the market mid rates to use as a reference.

The closest the average consumer can get to the 'mid-market rate' is through Visa/Mastercard.

The Zero simply passes the Mastercard rate on to the consumer.

MasterCard uses multiple market sources (such as Bloomberg, Reuters, Central Banks and others) to develop exchange rates. These rates generally reflect either wholesale market rates or government mandated rates that are collected during the daily rate setting process. The displayed rates are derived from the buy and sell rates included in the MasterCard daily rate setting process and do not include any charges or markups applied by the Issuer. Please note that due to possible rounding differences, the displayed rates may not precisely reflect the actual rate applied to the transaction amount when converting to the cardholder billing amount. The exchange rate that is applied to a transaction is the exchange rate as of the day of settlement which is the day that MasterCard determines the settlement amount to be exchanged between the acquirer and the issuer. The settlement date is therefore typically different from the date of the actual transaction.

So the best we can do is to find cards that don't tamper with this process.

This has already been well documented.
So I'm not sure why to all the comparisons on an already proven card.

cepheus

stilltheone wrote: »

What makes you think so??

I checked them against the mid price for the day here. These mid prices should be half way between the buy and sell price, and the theoretically the best possible price at that point in time. However, they will vary during the day of course. Unfortunately, due to formatting problems I can't paste them, you will have to press the link.

benjus

stilltheone wrote: »

The closest the average consumer can get to the 'mid-market rate' is through Visa/Mastercard.

The Zero simply passes the Mastercard rate on to the consumer.

MasterCard uses multiple market sources (such as Bloomberg, Reuters, Central Banks and others) to develop exchange rates. These rates generally reflect either wholesale market rates or government mandated rates that are collected during the daily rate setting process. The displayed rates are derived from the buy and sell rates included in the MasterCard daily rate setting process and do not include any charges or markups applied by the Issuer. Please note that due to possible rounding differences, the displayed rates may not precisely reflect the actual rate applied to the transaction amount when converting to the cardholder billing amount. The exchange rate that is applied to a transaction is the exchange rate as of the day of settlement which is the day that MasterCard determines the settlement amount to be exchanged between the acquirer and the issuer. The settlement date is therefore typically different from the date of the actual transaction.

So the best we can do is to find cards that don't tamper with this process.

This has already been well documented.
So I'm not sure why to all the comparisons on an already proven card.

I'm well aware of all this. Maybe some people like to see some evidence that the cards are performing as they should. Since Mastercard don't publish their exchange rates as far as I can tell, the best we can do is to use the mid market rate as a reference point; it's fairly safe to assume that the Mastercard rate is going to be close to this, at least for major currencies, and it allows us to directly compare the cards with other methods of getting foreign currency.

stilltheone

cepheus wrote: »

I checked them against the mid price for the day here. These mid prices should be half way between the buy and sell price, and the theoretically the best possible price at that point in time. However, they will vary during the day of course. Unfortunately, due to formatting problems I can't paste them, you will have to press the link.

Perhaps you can actually copy and paste directly from your statement.

The Halifax website tells us something different:

You can use your card in any shop or cash machine at home or abroad, that displays the MasterCard or Visa symbol, depending on your type of card.

Most of our products also have fees on balance transfers, cash advances and cheques and any transactions you make overseas could also incur a foreign currency exchange fee of 2.95%. Please see your Credit Card Conditions or monthly statements for more details.

Most of our products also have fees on balance transfers and cheques. Please see your Credit Card Conditions or monthly statements for more details.

So any clear info you can provide may help others who have the same card but don't use it.

cepheus

Sorry Meant Nationwide not Halifax Dohhh!

Nationwide still don't charge for Europe do they?


Here is a mid price chart for the last week

stilltheone

cepheus wrote: »

Sorry Meant Nationwide not Halifax Dohhh!

Nationwide still don't charge for Europe do they?

:mad:

Yes, Nationwide CC customers who joined up prior to Feb should be on the former T&Cs.

Baldur

benjus wrote: »

Since Mastercard don't publish their exchange rates as far as I can tell....

Both Mastercard & VISA publish their FX rates up to the previous day's date:

Mastercard

VISA

stilltheone

benjus wrote: »

I'm well aware of all this. Maybe some people like to see some evidence that the cards are performing as they should. Since Mastercard don't publish their exchange rates as far as I can tell, the best we can do is to use the mid market rate as a reference point; it's fairly safe to assume that the Mastercard rate is going to be close to this, at least for major currencies, and it allows us to directly compare the cards with other methods of getting foreign currency.

Seems that you missed the link to the Mastercard rates in my post.

benjus

You're right, I did. Sorry about that.

cepheus

Article here, tells us more or less what we already know. However, perhaps this suggests why my Santander card no longer works, unless the original T&C are still honoured. I haven't any other account or used the card for ages, but they still sent me a new one last year!

Santander Zero
Loading (exchange rate fee): 0% in Europe and worldwide
Cash withdrawals Fee: free
Interest: Yes even if repaid in full
APR: 18.9% on cash and spending. (variable)

This is Money says: This offer is only available to Santander customers if your main current account has been with the bank for 3 months or more, paying in at least £1,000 a month, or you have a mortgage or investment with Santander.

Read more: http://www.thisismoney.co.uk/credit-and-loans/article.html?in_article_id=531315&in_page_id=9#ixzz1KEe9NdOh