The typical travelling Briton relies heavily on cash to pay his or her way whilst they are abroad, regardless of whether they are travelling on business or for pleasure, according to research published by Santander.
The research reveals that just over half of all Britons (51 per cent) travelled abroad in 2009 - and that just over half (52 per cent) of these used cash for the majority of their purchases. The next most popular methods for Britons travelling abroad were using the
credit card (20 per cent) and debit card (15 per cent).
Surprisingly, the once dominant traveller's cheque is now out of favour with only one in twenty (5 per cent) using them - the same number that have a foreign currency account.
The research also reveals that the average spending money whilst abroad is £207 per person per week. And, that almost half of British travellers (47 per cent) withdraw three quarters of their weekly spend (£147) using an ATM machine whilst they were abroad.
Withdrawing money from ATMs abroad typically will incur the following charges: A cash handling fee - 1.5 per cent of the transaction (minimum £1.99); AND a foreign exchange fee - 2.75 per cent
This means that if a Briton withdrawals the equivalent of £147 in foreign currency from an ATM abroad in one transaction - it will cost them £6.25 or as much as £8.02 if they do it in two transactions.
Santander calculates that if a family of four went on holiday for a fortnight - they would spend £1,656, and that this could cost them as much as £73.64 in transaction fees.
“Britons are convinced that credit and debit cards offer terrible rates of exchange, but this is simply not the case - the exchange rate on cards tends to be very close to the daily wholesale rates," said Vim Maru, Director of Retail Products, Santander UK
"Many are aware of the charges they face when using an ATM abroad, but are prepared to pay the charges for the convenience of easy access to cash, and the security of not having to carry large sums around.
“However - it is not just ATM withdrawals where you can incur a fee. If you use a debit card to purchase items in a shop or restaurant you will also incur a foreign exchange fee, as of course you will when exchanging money in the UK before travelling abroad.”
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