Halifax Clarity Card - Overseas Withdrawals

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rjmachin
rjmachin Posts: 340 Forumite
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Hi,

I have seen similar threads on this but not answering the exact question I have been wondering.

I have a Halifax Clarity credit card, which I have been using in the UK for a few months for small purchases and have been paying off in full each month.

I am going abroad soon and where I will be staying near to an ATM that does not charge withdrawal fees.

Instead of exchanging my money at the post office (or other similar places) and taking cash, I was thinking of just taking my credit card, using it for purchases where possible, and withdrawing a small amount as and when needed at the ATM (and choosing the local currency of course).

I have my card account set up to pay in full by direct debit, so I just make my small purchases and it automatically pays it off each month as required.

Am I still okay to do this with the cash withdrawals, i.e. wait for the statement and to let it pay off in full automatically?

Or do they charge interest straight away on withdrawals? In which case, I may be better to just exchange at the post office?

I have just seen this on the website:
Interest charges apply to cash you take out, from the day the cash is withdrawn

Would I be better then just withdrawing and exchanging cash at home before I go and use the card for purchases where possible?
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  • Ebe_Scrooge
    Ebe_Scrooge Posts: 7,320 Forumite
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    They will charge interest on cash withdrawals straight away from the date of withdrawal - even if you pay the full balance off at the end of the month.

    However, the advantages are that there's no cash withdrawal fee imposed by Halifax - so as long as the owner of the cash machine doesn't charge a fee themselves, you make a saving there. Quite often, even if you use a debit card to withdraw cash, you'll be charged a fee. Also, you'll more than likely benefit from a better exchange rate, as Halifax will use the prevailing Mastercard rate, which tends to be amongst the most favourable available.

    If you want to avoid paying any interest, you can make a payment to your card before the statement arrives. You need to make sure that the transaction has appeared on your account first, which may take a day or two, and then pay off the cash withdrawal immediately. This assumes you're set up for online banking, and also that you have access to a secure internet connection - I wouldn't use a free public wi-fi for this.

    But ultimately, even if you wait until your monthly direct debit pays off the full balance, you're looking at a couple of quid or so in interest, the price of a beer. So overall, you'll probably make a saving compared to other methods of exchanging the money - and lets face it, if you're on holiday, who wants to be logging on and sorting out finances every day ?
  • eDicky
    eDicky Posts: 6,574 Forumite
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    rjmachin wrote: »
    Or do they charge interest straight away on withdrawals? In which case, I may be better to just exchange at the post office?
    You have a Clarity card - stay away from the Post Office..!

    Yes, daily interest begins after withdrawals, but it's relatively insignificant, especially compared to what you will lose on the exchange rate given by the post office and others. You can make an early payment if it's not inconvenient - don't let it disturb your holiday...
    Evolution, not revolution
  • pramsay13
    pramsay13 Posts: 1,952 Forumite
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    Apply for a Starling card and take it with you.
    Then withdraw as you need it from the atm with no fees and no interest.
  • zagfles
    zagfles Posts: 20,323 Forumite
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    Monthly interest on a credit card is typically around 1-2%.

    Markup on the exchange rate for changing cash is typically 4-6%
  • YorkshireBoy
    YorkshireBoy Posts: 31,541 Forumite
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    zagfles wrote: »
    Monthly interest on a credit card is typically around 1-2%.

    Markup on the exchange rate for changing cash is typically 4-6%
    And accepting the conversion rate offered by the ATM could cost you nearly 10%, so be sure to opt for 'without conversion'.
  • Cisco001
    Cisco001 Posts: 4,019 Forumite
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    Will you have internet access when you are away?
    Do you use mobile banking?

    What I did previously is once I withdraw, I log in with mobile app straight away and transfer money from my current account to credit card account.
  • jennifernil
    jennifernil Posts: 5,580 Forumite
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    We have been using the card abroad for several years, the amount of interest charged when we left it to be paid via our direct debit worked out at around £1 per month per £100 cash withdrawn.

    I would just leave things as they are, the interest will be insignificant in the overall cost of your trip.
  • Takmon
    Takmon Posts: 1,738 Forumite
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    jennifernil wrote: »
    We have been using the card abroad for several years, the amount of interest charged when we left it to be paid via our direct debit worked out at around £1 per month per £100 cash withdrawn.

    I would just leave things as they are, the interest will be insignificant in the overall cost of your trip.

    Now that you can get cards like Starling and the Barclaycard Credit Card with no interest on withdraws nobody should be using the Halifax Clarity for cash withdrawals. It's also good to have a couple of different cards so apply for one of these for next time your away.
  • System
    System Posts: 178,094 Community Admin
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    Ebe_Scrooge wrote: »

    However, the advantages are that there's no cash withdrawal fee imposed by Halifax - so as long as the owner of the cash machine doesn't charge a fee themselves, you make a saving there. Quite often, even if you use a debit card to withdraw cash, you'll be charged a fee. Also, you'll more than likely benefit from a better exchange rate, as Halifax will use the prevailing Mastercard rate, which tends to be amongst the most favourable available.

    Third party ATM owners always charge a fee - it's just that they usually charge the card issuer (LINK / Visa / Mastercard interchange fee) and not directly the card user.

    Starling will be offering free usage as a loss leader.
  • rjmachin
    rjmachin Posts: 340 Forumite
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    Thank you everyone, plenty to think about there.
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