Confused with Credit Cards - Is HSBC okay?

anotheruser

Hi

So I was reading on the site about using credit cards abroad. I have an HSBC credit card but the site suggests this isn't great. Here's some info:

When I check in to the Spanish resort, they will take a swipe of my card, then give me an internal card to use. Throughout my stay, I use the internal card to record transactions.
At the end of the stay, they print out a receipt and charge my credit card, one payment.

I spoke to HSBC who said they don't add any charges, so if I spent €100, then on my bank statement it will show as €100, with the conversion into pounds sterling next to it, which is what I will be charged.
The nice lady also told me the exchange rate will be whatever the hotel uses on the day they charge the card.

If so, then is there any need to get the Halifax card?

From what I understand, the "exchange load" is a charge the bank would add when the card is charged abroad.

Thanks

benjus

HSBC credit cards are bog standard - 3% on all foreign spending, plus charges & interest for cash withdrawals.

So if the resort puts the transaction through in Euros, you'll get the current Visa/Mastercard exchange rate + 3%. If the resort performs Dynamic Currency Conversion (DCC, i.e. they convert it to Pounds before charging you), then you'll pay whatever exchange rate they choose. In general it's best to avoid DCC and always pay in foreign currency as they tend to take a cut of more than 3%. They should not apply DCC without your permission - if they force it on you, complain to HSBC.

So basically, think about how much you're likely to spend and take 3% of it. That's how much you'd save by using a Halifax Clarity (or similar) card. Then decide if it's worthwhile getting one.

anotheruser

So did HSBC lie then? They would add 3% to the €100 euros?

Sorry, this is the first time I have been abroad. I plan to take an amount of cash for spending around so won't be using it for cash advances, but in the resort it'll all go on the internal card thing.

I am pretty certain they will charge me in Euros.

I was thinking about getting the Halifax Clarity card anyway but as a "just in case" preparation then it'll be good to know what I am going to be charged.

loobs40

anotheruser wrote: »

I am pretty certain they will charge me in Euros.
.

Nope, they will try to do Dynamic Currency Conversion because it makes them some money. You have to insist on being charged in Euros and then check again before putting in your PIN

Its the same principle when you withdraw cash from a foreign ATM. It will ask you whether to do the conversion. Always select the Euros option (if in Euroland of course !)

benjus

anotheruser wrote: »

So did HSBC lie then? They would add 3% to the €100 euros?

Probably not an intentional lie. Some cards charge a fee as well as an exchange rate loading. The exchange rate loading is considered "standard" (even though cards like the Halifax Clarity don't charge it) so they often don't consider it as a charge. Also, in my experience lots of bank staff don't really understand how card use abroad works. Fortunately, we do

So if your bill came to €100, you would effectively pay €103 at the Visa/Mastercard exchange rate of the day. As mentioned previously, watch out for DCC - it's extremely common in Spain and they do often break the rules and try to do it without asking you... check and double-check the currency you're being charged in before entering your PIN.

anotheruser

Okay, thanks. I'll get the Halifax card to be certain anyway

I'll make sure everything is in Euros