Barclaycard Reward Foreign usage: Are fees just hidden in their Visa conversion rate?

CA0Squids

MSE recommends using a Barclaycard Reward in preference to a Lloyds credit card abroad. 

But, I'm failing to spot a considerable difference between the cards if you look at their small print and how they calculate their FX and conversions. 

Is this correct? Or am I comparing apples and oranges? Apologies, very new to all this. 

My attempt to compare them appears to have Barclaycard Reward as costing more to make a Euros purchase plus when you look at the T&C's it looks like they put the non-sterling purchase fee into their reference exchange rate. 

I don't suppose anyone has made comparison purchases abroad with their Lloyds cc v a Barclaycard Reward card and seen how the conversions actually compare?  It's all sooo confusing! 

I'd welcome views, explanations, experience with these cards. 

Thanks! 

Comparison Foreign Purchase/payment of 100 euros: 

Lloyds illustration: 100 euros payment costing £86    (Google using your card abroad) 
Incurs a 2.95% transaction fee (non-sterling fee) ie. £2.49. 
Uses a sample Payment scheme exchange rate of 1.18496 and then adds the above non-sterling/transaction fee

Barclaycard Reward 100 EUR = 88.320936 GBP (£2 more but using a day of rather than sample rate) 

Promises: "Non-sterling transaction fees will not be charged on purchases." 

BUT their terms explain further "Making transactions in a foreign currency i.e. Non-sterling transactions will be converted to sterling at a reference exchange rate. For purchases this is made up of the payment scheme exchange rate and the non-sterling purchase fee."
When you click thru to see how this Visa rate is calculated for a 100 euro payment:  
 
% Mark-up over European Central Bank Rate = 2.33 

(Rate 1 GBP = 1.132234 EUR) 

MyRealNameToo

Barclaycard Reward simply uses the card network rate

Lloyds offer multiple credit cards and you dont say which one you are looking at? Their standard come with a 2.95% fee so they too will use the network rate to convert to GBP but then apply a fee onto it. 

grumpy_codger

CA0Squids said:

I'd welcome views, explanations, experience with these cards. 

AFAIK, all card providers mush show their fees explicitly in the statement. So, you see two separate transactions - the amount converted at Visa/Mastercard rate and the CC provider fee. 

Barclaycard Reward - no fee.

Both Visa and Mastercard rates are very close to the interbank rate.

sausage_time

See this earlier thread

https://forums.moneysavingexpert.com/discussion/6611589/im-clearly-not-getting-the-barclaycard-fees-abroad-thing

Olenna

The card issuer doesn't really matter; card issuers generally use the card scheme (e.g. Visa) to do the conversion for them.

Barclaycard is offering the Visa rate plus 0.25% cashback with no monthly fee.

If you use something like Lloyds Bank World Elite Mastercard then you could actually have a better transaction with Lloyds - you'd get the Mastercard rate plus 0.5% / 1% cashback. Obviously this card has a £15 monthly fee but you get inclusive airport lounge access and fast track airport security too so will work for some people.

NoodleDoodleMan

I suspect much of the confusion is down to Barclaycard publishing generic type guidance covering fees for all their credit cards without indicating that the Rewards card is exempt for foreign purchases and ATMs.?

grumpy_codger

NoodleDoodleMan said:

I suspect much of the confusion is down to Barclaycard publishing generic type guidance covering fees for all their credit cards without indicating that the Rewards card is exempt for foreign purchases and ATMs.?

Publishing where?

https://www.barclaycard.co.uk/personal/credit-cards/barclaycard-rewards

No fees abroad

You’ll be able to withdraw cash from an ATM or buy your souvenirs without any charges and benefit from Visa’s competitive exchange rate.

Summary of rates

Foreign Usage

Payment Scheme Exchange Rate: Depending on your card type, rates can be found at either Visa or Mastercard   

Non-sterling transaction fees will not be charged on purchases.

For the OP it's worth adding MSE's  Travel card need-to-knows

If asked if you'd like to pay in pounds or the local currency, always pick the local currency

+ 

Using plastic overseas? Always PAY IN EUROS

   [ IN LOCAL CURRENCY] 

Avoid holiday rip-offs

daveyjp

I've used Rewards in many countries and conversion rate on the transaction is always more or less the bank rate for the day the purchase was made.

CA0Squids

Thanks everyone for your time and comments. Good to have some reassurance that it is indeed just the day-of bank rate charged so long as paid in local currency and paid off by end of month. Very useful. Thank you all! 

NoodleDoodleMan

Publishing where?

A pamphlet came with the card a few years back advising fees abroad without specifically mentioning that the Reward card was exempt.

grumpy_codger

I think this was when they started offering this particular card and hadn't updated everything yet. Was it about 2020-2021?