Exact date this month high street bank with 3million customers to start charging fees to use debit card abroad
A MAJOR high street bank with millions of customers is axing fee-free debit card use and ATM withdrawals this month.
Metro Bank is set to introduce a 2.99% fee on all debit card transactions made outside the UK from August 30 – including Europe, where it is currently free.
Customers withdrawing cash anywhere abroad will pay the new 2.99% fee plus an additional £1.50 ATM fee.
Metro Bank, which opened its first UK branch in 2010, lets its three million customers spend on their debit cards and make cash withdrawals in a foreign currency in Europe fee-free.
But in an email sent in late June, it said this policy would be ditched.
The email read: “After August 29 2024, debit card payments made in a foreign currency outside the UK will be charged 2.99% on the converted British Pound value of the transaction.
“After August 29 2024, cash withdrawals made in a foreign currency using your debit card outside the UK will be charged 2.99% on the converted British Pound value plus £1.50 ATM fee.
“This charge is applicable for each transaction you make.”
The change means customers sticking with the bank could quickly see costs rack up while abroad.
For example, anyone spending £100 on their card from August 30 will pay £3 in fees. Spend £200 and this will rise to £6.
Anyone withdrawing cash from an ATM will incur the £2.99 fee and additional £1.50 withdrawal fee.
A spokesperson for Metro Bank previously told The Sun: “Over time, we’ve seen our customer’s needs and expectations evolve and the demand for this service has been declining over a number of years.”
What other banks charge
First Direct
First Direct does not charge fees for using a debit card to make a payment in a foreign currency or for making a cash withdrawal in another country.
There is a daily cash withdrawal limit of £500 (or the foreign currency equivalent) at ATMs.
HSBC
Customers with a HSBC Global Money Account can spend abroad and withdraw from cash points fee-free.
Global Money accounts are available to any HSBC customers with an active current account and its banking app.
Other debit card customers are charged 2.75% while credit cards incur a 2.99% fee.
Lloyds Bank
Lloyd’s Silver and Platinum account customers have been able to use their debit card anywhere in the world free of charge from July 1.
However, the Silver Packaged Bank Accounts costs £11.50 a month while the Platinum option costs £22.50 a month.
Monzo Bank
Monzo says customers can pay anywhere and in any currency on their debit card with no foreign transaction fees.
And if Monzo is your main bank account, you can make unlimited fee-free withdrawals in the European Economic Area (EEA), and up to £200 every 30 days anywhere else. After that, the bank charges 3%.
Santander
If you have the Santander Edge, Santander Edge Up and Private Account debit cards, you can withdraw money fee-free and you won’t get foreign transaction fees on spending while away.
All other accounts with Santander charge 2.95% for both purchases and withdrawals.
Starling Bank
Starling doesn’t charge for using your debit card while abroad.
TSB bank
If you have a TSB Spend and Save Plus account, you will pay no fees on debit card transactions worldwide.
Other account holders will pay 2.99% in fees on transactions, and 1.5% fees on any money withdrawn.
There are no fees for making a cash withdrawal in Euros from a cash machine in an EEA country.
You can read our full guide to other banks which don’t charge fees on foreign transactions here.
How else to save money on holiday
One sure-fire way of forking out more than you should on holiday money is using a Bureau de Change at the airport.
These usually offer the worst rates around so your best bet is shopping around online and buying days in advance.
Always pay in the local currency to get the best rate too.
This means if you are in the Eurozone opt to pay in euros, not pounds or, if you are in the US, pay in dollars.
If you do have a debit card that charges you a foreign transaction fee, try to withdraw all your money at once so you’re not hit with multiple charges.
Options for holiday spending if you don't want to exchange currency
There are several specialist cards that can give you a great exchange rate.
These cards include travel credit cards and pre-paid cards which can let you pay abroad without fees or at a set exchange rate.
Travel credit cards: Travel credit cards allow you to spend money abroad without being hit by any fees or hidden charges.
But, they may still charge you for taking cash out.
We recommend the Halifax’s Clarity Card as it won’t charge you for using it abroad, nor are there any fees for withdrawing cash.
But you will be charged interest if you don’t repay your balance in full at a rate of 19.9 per cent.
And you will be charged interest on cash withdrawals until your balance is paid off too, at a rate of between 19.9 and 27.95 per cent depending on your credit score.
In other words, just because you are using plastic abroad doesn’t mean you don’t have to pay these credit cards off like you normally would.
Always pay off your balance before the end of the month with these cards to make sure that any money you saved isn’t wiped away by paying interest.
For more on travel credit cards you can read our guide here.
Pre-paid cards: An alternative to carrying cash around is to get a pre-paid card.
These cards allow you to put a set amount of cash on the card at a fixed exchange rate.
So if the rate is good at the moment, you can put money on your card and it will stay that rate when you are on holiday.
Just keep in mind that these cards can sometimes have hidden costs and charges so be sure to read the small print.
Do you have a money problem that needs sorting? Get in touch by emailing money-sm@news.co.uk.
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