Only 18% Of Brits Purchase Foreign Currency Efficiently

Only 18% of Brits use the most efficient way to purchase foreign currency, via online order or by using a foreign currency card, according to new research by cost comparison site, Quote Goat.

The research, which surveyed 1,000 participants between the ages of 18 – 65 on their understanding of foreign currency, also revealed a massive 3 in 4 people are completely unaware as to what the most cost-effective or cheapest method is, when it comes to purchasing foreign tender.

When using UK bank cards overseas and presented with the option to pay in GBP or the visiting country’s currency, an alarming 50% of Brits either don’t know which currency to choose or incorrectly select GBP, facing additional dynamic currency conversion [DCC] charges of 6 – 10%.

With ABTA revealing £31.6bn* is spent by UK holiday makers each year, this implies that a massive £132 Million is needlessly spent per annum on DCC charges by UK holiday makers, calculated by the 14% who confirm they use their bank card overseas.

Michael Foote, Managing Director of Quote Goat, commented: “This latest research highlights that just under a fifth of Brits are shopping savvy when it comes to purchasing foreign currency, with only 4% aware of the benefits of foreign currency cards.”

“There is also an evident lack of understanding in how best to use bank cards when purchasing goods or services overseas. The best option is to select the visiting countries currency and let your own bank handle the conversion as they are almost always cheaper.”

“The DCC (dynamic currency conversion) is not subject to a cap on the amount charged, however rules state that the customer has to be given the option to select which currency to use, so be sure that the retailer is not automatically selecting GBP for your payment.”

“Ultimately, the best option is use a currency card or pre-order your Euros online to get the best rates.”

Other key take outs from the research include:

  • The majority of Brits only go abroad once per year [54%], with just over a quarter [27%] able to enjoy two overseas holidays per annum.
  • Just over a quarter of Brits believe that the Post Office is the cheapest place to purchase foreign currency.
  • A fifth of Brits commonly purchase their foreign currency from their local travel agent, with just 4% making use of foreign currency cards.
  • Most Brits [32%] spend up to £1,000 per year when abroad, with 14% spending up to £1,500 and 12% up to £2,000.