BEWARE THE SLIPPERY SLOPE OF CURRENCY CHARGES

• Bristol and Luton UK’s most expensive airports for foreign currency purchase

• ‘Traditional’ travel money choices cost holidaymakers dear

Bristol and Luton airports are today revealed as the most expensive UK departure points for buying foreign currency.

New research* from prepaid currency card provider FairFX.com reveals British travellers off on a half-term trip risk paying as much as to 12 per cent more for foreign currency if they leave it until they get to the airport compared to buying it online.

FairFX.com’s analysis reveals the UK’s most expensive foreign exchange bureaux:

1. = Travelex, Luton
2. = Travelex, Bristol
3. Travelex, London City
4. Travelex, Belfast
5. ICE, Luton
6. ICE, Manchester
7. Travelex, Birmingham
8. ICE, Birmingham
9. ICE, Gatwick
10. Travelex, Stansted

Many travel money providers claim they offer travellers 0 per cent commission but, as the FairFX.com analysis shows, this hides the true margins they add to wholesale currency rates when providing foreign exchange for travel purposes.

Over the last 15 months the average profit margin on currency bought at UK airports is around seven per cent. However, while Heathrow typically offers the cheapest currency, the figures show customers using regional airports like Luton, Birmingham, Manchester or Bristol could needlessly be paying as much as 12 per cent for their ‘0 per cent commission’ currency.

According to research** conducted for FairFX.com by YouGov three quarters (74 per cent) of travellers typically use cash when they spend abroad. Travel cash bought outside of the airport can also be overpriced. Most high street providers charge, on average, a five per cent premium. The one in four-or-so Brits who favour plastic (29 per cent with Visa, 25 per cent with a debit card and 22 per cent with Mastercard) will also be paying a premium to use their cards abroad, usually around three per cent.

However, prepaid currency cards offer a different solution. They work just like a debit card but can be topped up via the internet or by text. The FairFX currency card offers rates for Euros and US dollars at less than one per cent margin above wholesale rates – i.e. giving all users ‘business’ level foreign exchange rates.

Stephen Heath, Chief Executive of FairFX.com, said: “Whichever way you look at it UK travellers are losing out when they buy currency. Most providers rely on the fact holidaymakers will be in a complete rush when preparing for a trip abroad, and either fail to organise currency before they get to the airport or opt to use costly credit or debit cards for their foreign spending. Our analysis shows to what extent this approach could be costing travellers dear.”

How does the FairFX card work? The FairFX Currency Card is a MasterCard chip and pin enabled prepaid debit card. It differs from regular debit cards in two ways. Firstly, the cards are issued in either Euros or US dollars and secondly, funds must be loaded onto the card before they are available to spend. The currency to be loaded is obtained simply by logging on to www.fairfx.com and can be paid for by any sterling debit or credit card or internet bank transfer.

Tuesday 12 February 2008, 12:16pm

Tags: airports, heathrow, ICE, M&S, opodo, travelex, YouGov