Club Lloyds customers will no longer need to pay foreign currency fees when withdrawing their cash abroad.
The new perk, which took effect on 14 April, means subscribers will no longer be charged a debit card fee when they make payments in a foreign currency, withdraw money from an ATM, or take out money over the counter abroad.
The Club Lloyds account fee starts at £3 a month, although this will increase to £5 a month from 2 June.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Customers who deposit £2,000 or more into their accounts a month will have this fee waived and can enjoy the perks associated with a basic ‘Club Lloyds’ account without the extra cost.
The removal of foreign transaction fees will make banking with Lloyds a more attractive option for frequent travellers. By waiving foreign currency fees for some customers, Lloyds now joins many ‘challenger’ banks who have done the same, including Monzo, Starling, and Chase.
What is Club Lloyds?
Club Lloyds is one of an increasing number of packaged bank accounts that allow users to enjoy some premium perks alongside their banking.
Club Lloyds account holders will receive the aforementioned removal of foreign currency fees, but can also get a choice of a subscription to Disney Plus, discounted cinema tickets, magazine subscriptions, and more.
More significantly, they are also given access to preferential rates on savings accounts, with interest rates up to 6.25%, making it among the best savings accounts on the market right now.
However, as mentioned previously, the perks come at a cost. The basic package costs £3 a month, the silver package costs £11.50 a month, and the platinum package costs £22.50 a month.
What other cards offer no foreign transaction fees?
As well as Club Lloyds customers, there are a number of other cards that don’t have foreign transaction fees.
For example, the Halifax Clarity credit card, the Barclaycard Rewards credit card, and the NatWest Credit Card, all do not charge their customers a foreign transaction fee.
Other banks that offer this perk include Monzo, Starling, and Chase which do not add any foreign transaction fees.
Revolut changed its extra weekend currency exchange fee rules for some of its premium customers on 22 April.
The global financial technology company has removed additional weekend currency exchange fees for Premium, Metal and Ultra customers. These account holders spend between £7.99 and £55 per month for the plans.
Customers who have a Revolut Plus account (£3.99 a month) will now pay a reduced 0.5% additional weekend foreign currency fee, and standard customers will continue to pay a 1% fee.
Whichever card you opt to travel with, it is important that you fully understand the terms under which you can use the card abroad.
Even if you think your card does not charge a foreign transaction fee, it is best to check the small print and make sure to avoid any extra unwanted charges.
Should you pay in local currency when you’re abroad?
When travelling abroad, holidaymakers may wonder whether they should pay in the local currency or not.
Using euros in Spain, rupees in India, or złoty in Poland is often the best way to make the most of your money while abroad, according to research by NatWest.
The bank claims holidaymakers are losing £17 million a year by choosing to pay in sterling rather than opting for the local currency.
Furthermore, they say that this number could be even higher as it only includes extra charges from ATMs, accommodation, restaurants, duty free and groceries.
This disparity occurs because customers are suffering from poor merchant currency conversion rates when they choose to pay in sterling that are far worse than the market rate.
Paying in local currencies helps customers sidestep these poor merchant rates and instead only be subject to potential foreign currency fees from their banks.
Hazel Harper at NatWest said: “There’s one simple trick to saving on your holiday when you’re abroad and it’s by always choosing to pay in the local currency.
“Our research found that it could be up to 13% more expensive to pay in pounds which makes a big difference to the cost of a holiday.”
-
‘I installed a heat pump in my home – here are five things I’ve learnt’From the size and noise of a heat pump to how much it costs to run one, Ruth Emery reveals what she’s learnt after installing one in her home six months ago
-
3 ways to work out if a stock is good valueThe only thing you can really control in investing is the price you pay for an asset – but how can you tell if you’re getting a good deal when it comes to the price of a stock?
