MARTIN Lewis’ MSE team has revealed that a major bank account now offers ‘near perfect’ exchange rates for spending abroad.
First Direct has scrapped all debit card fees on overseas spending and ATM withdrawals abroad.
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Martin’s team said: “The move is a boost for existing First Direct customers as the account is already one of our best buys.
“For switchers, you can also get First Direct’s £175 bonus on top.”
MoneySavingExpert.com reports that as of Wednesday, June 28 First Direct has scrapped both the non-sterling transaction fee and non-sterling cash free on all debit cards.
Customers used to be charged 2.75% when making debit card transactions abroad or taking cash out at local ATMs.
But you would also be charged an additional 2% fee, capped at £5, when making withdrawals abroad.
This means that there are now no fees for spending or withdrawing cash abroad and the change affects both new and existing account holders.
But customers are limited to making a maximum of £500 in ATM withdrawals per day.
The MSE team also said: “Note that foreign ATMs may still charge you to take money out – but these fees are not set or taken by First Direct itself.”
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The changes do not affect the bank’s credit card and customers will still be liable for a 2.99% fee for spending abroad.
Unlike First Direct, HSBC doesn’t automatically off fee-free spending and cash withdrawals abroad to debit card customers.
But most HSBC bank account customers can open a free Global Money account in their online banking app.
Customers are then sent a separate Global Money debit card which can be used for fee-free spending abroad.
However, the MSE team said: “The change is good news for new or existing First Direct customers who want to keep their banking in one place – but if you don’t mind opening another account, there are cheaper ways to spend abroad.
“That’s because, in addition to giving near-perfect rates and not charging fees, our top-pick specialist travel debit and credit cards also offer ongoing cashback on spending or sign-up bonuses.”
Which other banks offer similar perks?
Chase Bank is fee-free for spending and cash withdrawals abroad and gives you one per cent cashback on all your spending, paying up to £15 a month for the first year.
Those who can afford to spend with a credit card can also take advantage of best buy travel cards.
The Halifax Clarity credit card has no charges on overseas spending or withdrawing cash.
New customers can also get £20 in free cash when they make a purchase within the first 90 days of membership.
The Barclaycard Rewards card doesn’t charge fees on spending or ATM withdrawals abroad.
There’s also no interest on any cash withdrawn, as long as you pay it back when your next bill is due — but ATM providers could still slap on a fee.
Other challenger banks like Starling and Kroo also offer fee-free spending abroad.
This post first appeared on thesun.co.uk
