Customers can avoid paying fees when they use their credit cards abroad, according to Fool.co.uk, which has identified what it considers the six best fee-free foreign exchange credit cards.
According to the site, credit card
users generally pay an extra two per cent when using their cards while on holiday abroad. This means they are paying an additional £20 per £1,000 spent.
However, Fool.co.uk claims consumers now have the choice of six credit cards that will not charge for buying goods or services while they are overseas. These are currently available from Nationwide, Abbey, Saga, Goldfish, Post Office and Thomas Cook.
Head of personal finance, David Kuo, said: "It started as a unique selling proposition for one credit card provider, but cards that don't sting customers when they use them abroad have now grown to half a dozen.
"Charging customers for using their cards overseas is tantamount to being surcharged for using cutlery in a restaurant. It is preposterous. But it is pleasing to see six companies taking a stand against it."
However, the company is encouraging consumers to be aware of some of the conditions attached to these credit card deals. It points out that the Saga Platinum fee-free deal only applies to purchases made within Europe, and applicants must be aged 50 or over.
Meanwhile, the Goldfish i24 charges a substantial annual fee of £275. And, although consumers may be able to recoup some of this by taking advantage of its one per cent cashback clause, the deal is capped at £210, leaving a £65 deficit. It does, however, include benefits such as worldwide travel insurance
for flight cancellation and lost luggage.
Some providers offer zero per cent credit cards
, for example the Nationwide Gold, Post Office credit card and Abbey Zero. While Nationwide and the Post Office provide zero per cent interest on purchases for three months and zero per cent interest on balance transfers for 10 months – subject to a fee – the Abbey deal offers a six month interest-free period but does not involve a fee.
Defaqto is also encouraging consumers to shop around when it comes to credit cards, whether they are planning to go abroad or not. Principal consultant of banking at Defaqto, David Black, said: "Credit card rates generally have increased to the detriment of the consumer but it remains the case that the industry offers its best deals to new customers. For the creditworthy, there is still a clear incentive to change your credit card every year or so.
"Balance transfer fees have increased relentlessly and the vast majority now have no maximum cap on the fee, whereas previously £50 or £100 was the norm."
"Zero per cent introductory offers remain as the mainstay of attracting new customers but the major providers are taking a much more stringent approach in deciding to whom they will offer a card and indeed the credit balance that they will offer. It's a case of them chasing quality not quantity."