Beware - FairFX Card

pauljose1

I took MSE recommendation at took out two FairFx dollar cards in June for our family holiday to Florida.

Loaded them fine, used them... mmm problems.

The issue in the USA is that merchants, restaurants in particular, take an Auth transaction higher than the actual, for example a $85 meal, restaurant takes $100 as an Auth transaction and sometimes takes days to take the final amount of $85, in the mean time your available balance is reduced by the $100. No the biggest issue until that is you end your holiday and come home.... at the end of our holiday there were a few transactions where the final amount hadn't been taken, so after our return to UK we have a balance left on the account.

Here in lies the problem, there is no way to get the money back, and run the balance to zero, they charge £10 fee and a 1.4% fee or something like that to transfer funds out, not viable on a smallish balance, you can use the card in the UK, but at the prevailing exchange rate plus fee, again, how much do you have, how do you run to zero balance.... you simply can't.

If i had plans to return to USA no issue, but i do not have.

On my wifes card she lost the card, possibly stolen, they charge £10 for a replacement card, we didn't want a replacement card, wouldn't transfer the funds to my account, have same issue as above, can't get money back.

So beware, they market the card as tourist friendly, but it is not, any benefit in exchange rates are wiped out by these issues...

Disappointed, and still in debate with FairFX ref these issues.

NiftyDigits

That's why it's oft recommended, by myself at least, to take a card denominated in Pounds, not foreign currency.

pauljose1

But if its based in £ i may as well use a CC like Santander Zero as i cant then get advantage of a specific day where the exchange rate is good.

eDicky

If you have a Santander Zero card, no need to bother with the likes of FairFX - even for a backup there are better choices if you don't need dollars regularly.

If you are able to predict when to convert currencies you can be playing the forex market and be wealthy enough not to worry about holiday costs.

You're right though, the kind of costs and drawbacks you have encountered should be made more clear in the MSE advice.

NiftyDigits

pauljose1 wrote: »

But if its based in £ i may as well use a CC like Santander Zero as i cant then get advantage of a specific day where the exchange rate is good.

Not a wise decision.. You weren't getting the top rate with the Prepaid card in the first place. So likely the rate that you would have received with the Santander Zero would have been superior, even if you think that you bought at the top of the market with the Prepaid card.
You really should have thought it through, instead of suggesting that it was because of an MSE recommendation.
With a bit of mathematics, you can work out almost exactly what you can spend on the card. Take it as a lesson learned. Don't waste more time over it.

Neil49

It's not a good idea to obtain a prepaid card for a one - off trip for the very reasons you have discovered.

I have prepaid cards in both € and USD and top them up when I consider the rate to be good but I hold onto them for the long term. I also have a Halifax Clarity card for both backup and when the exchange rate is favourable to use it.

You may have got a good rate when you loaded your USD card up but you will have lost a lot more converting the remaining balance back to £ than if you had used a £ based card in the first place.

The issues you have raised don't just relate to FairFX prepaid cards and they can't really be blamed for your wife losing her card.

budgetflyer

pauljose1 wrote: »

The issue in the USA is that merchants, restaurants in particular, take an Auth transaction higher than the actual, for example a $85 meal, restaurant takes $100 as an Auth transaction and sometimes takes days to take the final amount of $85, in the mean time your available balance is reduced by the $100. No the biggest issue until that is you end your holiday and come home.... at the end of our holiday there were a few transactions where the final amount hadn't been taken, so after our return to UK we have a balance left on the account.

Are you sure they do that ? Are they maybe adding the "tip" ?
I dont think Id be too happy being charged $100 for a $85 bill and can see no reason for them doing this

pauljose1

yes they do this, its the same with every credit card, like when you check into a hotel or hire a car they take a preauth transaction, then convert it to a final amount.

ref the comment above about the card being stolen, yes it is their problem, because it is established by the FCA that it is unfair to customers if, due to an unforseen event, such as your card being stolen, you should not be disadvantaged as a customer, we have been.

The FairFX card is marketted to holiday makers, website even uses the phrase "The Smart Way to manage your travel money", the reality of how their product is designed is that it is impossible not to loose out and end up giving them some of your money..... that is not treating your customers fairly.

NiftyDigits

pauljose1 wrote: »

yes they do this, its the same with every credit card, like when you check into a hotel or hire a car they take a preauth transaction, then convert it to a final amount.

ref the comment above about the card being stolen, yes it is their problem, because it is established by the FCA that it is unfair to customers if, due to an unforseen event, such as your card being stolen, you should not be disadvantaged as a customer, we have been.

The FairFX card is marketted to holiday makers, website even uses the phrase "The Smart Way to manage your travel money", the reality of how their product is designed is that it is impossible not to loose out and end up giving them some of your money..... that is not treating your customers fairly.

Of course you are quite wrong, as in fact you can use every single cent on the card.

In addition to this, all of the charges are set out clearly here; https://www.fairfx.com/whatitcosts

You clearly thought that there was some benefit to purchasing US$ in advance. If you made a poor decision, you have no one but yourself to blame.
Don't blame Fairfx. The sold you a product that does exactly what it says that it does.
I had a Fairfx Anywhere card and have no complaints about them at all.
You have put yourself at a disadvantage, not Fairfx, as you decided to purchase US$. If you no longer want them, you have to accept that there is a cost to convert them to another currency or you can spend them on a website that accepts US$.

It's certainly possible to empty the card to close to zero. Using this website: https://www.mastercard.com/global/currencyconversion/ you can approximate the value left on your card by choosing US$ as the base currency. Currently £0.649351 to every US$
In simplified terms, for every US$101.4, you get £64.93 pence.
So divide the amount of US$ you have by US$101.4 then multiply it by £64.93.

Of course this is just an approximation, as the figures change daily. You can then use the card for purchases in the UK, keeping these figures in mind,

In your wife's case, the replacement card fee is US$12.

Either way, you are not going to be able to avoid the 1.4% conversion fee to change the US$ back to Pounds and you are going to have to choose from the £10 redemption fee or US$12 for a replacement card.
If your wife did not lose her card, you would not have to make that choice. Again, your fault.
Stop trying to pass the buck for your decisions and mistakes.
Fairfx are not at fault, in any way. It's not fair for you to be barracking them.

pauljose1

im sorry but your wrong and you clearly do not understand the reguatory framework that the FCA now deploys... i suspect this will go to ombudsman and find in my favour.

The product design is fundamentally flawed, you cannot have a product where you need a mathematics degree to run to zero, even leaving £0.01 to the company is wrong.

NiftyDigits

pauljose1 wrote: »

im sorry but your wrong and you clearly do not understand the reguatory framework that the FCA now deploys... i suspect this will go to ombudsman and find in my favour.

The product design is fundamentally flawed, you cannot have a product where you need a mathematics degree to run to zero, even leaving £0.01 to the company is wrong.

Ok, let us know when you win and the judgement. I predict that you will not.

Otherwise many of the other travel cards, such as Travelex, Asda, Sainsburys, Post Office would also be outlawed.
But the fact is that they are much worse.
They charge you 5.75% to convert foreign currency back to Pounds.

Fairfx will give you your full balance back, minus the £10 redemption fee..
If you don't want to pay the redemption fee, do the maths as described and you pay only the 1.4% exchange fee. In fact I'm not sure that you would need to pay even the 1.4% exchange fee.
So it may be just a matter of working out how much is on the card and then spending it.
Please don't embarrass yourself with this. If you were in the right, there would be people posting in support of your position....including myself.
It is not the fault of FairFx that the merchants take a higher authorisation amount.

Redemption Fee £10 for Euro and US Dollar cards. 1.40% of outstanding balance for £ Anywhere Card subject to minimum charge of £10
FX Fee (when card used out of card currency) 1.40% for Euro, US Dollar and £ Anywhere Cards. Not applicable for Euro and US Dollar Cards when used in the UK.

So, according to their T&C, you may have to pay only the £10 redemption fee, with the balance exchanged at the full Mastercard exchange rate. A good deal. Accept it.
Of course I am referring to your wife's card.
As for your card....it was your choice to buy a US$ card. What do you want them to do about it? You had the opportunity to purchase the Anywhere card.
I'll state it again. This is not a Fairfx issue, the authorisation problem is an issue with Prepaid cards in general.