Using Credit Cards in the EuroZone

[the new blue]

When holidaying in Europe and you make a purchase on your credit card and you have the option to pay in Sterling or in Euros, which one should you choose to get the better deal?

[jake-the-peg]

Well it rather depends on what exchange rate they are going to offer you if you pay in stirling.

To answer that question you need to know what exchange rate your card will charge you and what price if any and how much the seller will charge you.

[hc4361]

If I’m abroad spending on plastic & they offer to let me pay in pounds, is it worth it?

A. No. This is called dynamic currency exchange, and should be avoided. Often the rate you get will be appalling and someone’s making big money out of it. If you’ve got one of the specialist overseas cards you’ll get a much better rate paying in the foreign currency not pounds. And even if you’re using a normal card as you’ve no idea of the relative exchange rates they could be playing you for a fool; so it's always best to stick with paying in the foreign currency.

If you're travelling to Spain, be especially careful. Some Spanish banks, particularly giant Santander, have started to ask UK cardholders if you want to have your money converted into Sterling when withdrawing Euros from ATMs. Always say No; the rate you'll get is often much worse than the rate you’d be given by your own plastic provider when it converts Euro withdrawals, although the exact rates depend on which plastic you're holstering.

http://www.moneysavingexpert.com/travel/cheap-travel-money#topcards