Banks stop foreign currency charges

20/12/11

By Yamurai Zendera

Holidaymakers have been given an early Christmas present with the news that five major banks have removed debit card charges for buying foreign currency in the UK.

The Office of Fair Trading (OFT) has reached an agreement over the removal of the charges, that were anywhere between 1.5 per cent and 2 per cent, with Lloyds Banking Group, Barclays, Royal Bank of Scotland, Santander and the Co-operative Bank.

Customers of Nationwide, HSBC and Halifax Bank of Scotland were already free from the fees.

In addition, there should be in theory more transparency for customers when it comes to charges incurred for using banks cards abroad, as banks have agreed to make the information relating to this more clear.

The OFT had been asked to look into the whole issue of bank charges for travellers following a complaint by Consumer Focus.

Elsewhere, foreign exchanges have said they will take a look at marketing practices such as zero per cent commission offers.

Mike O'Connor, Consumer Focus chief executive, said: "We also want to see an end to deliberately misleading marketing phrases such as '0 per cent commission', as services are not fee-free. Consumers have a right to know how much they are paying for their transaction and whether there are better options available."