Holidaymakers purchasing their travel money at the airport are being “ripped off” by bureaux de changes and face losing hundreds of pounds to “extortionate” rates.
This was the view of currency experts FairFX, which analysed the walk-up exchange rates at eight airports across the UK. At one, Moneycorp in London Stansted, customers would receive just €0.80 to the pound, losing travellers the equivalent of £138 worth of euros compared to the market rate for every £500 exchanged.
The market rate on Thursday when the outlets were surveyed was €1.11 to the pound, but none of the firms asked offered better than €0.95.
FairFX said the rates were the worst it had found in such an investigation.
“We all expect to pay a little more for convenience,” said Ian Strafford-Taylor, CEO of FairFX, “but as schools break up for summer we’re finding that airport bureau de change desks are ripping families off with extortionately high walk-up exchange rates.
“As families head into Europe for their annual summer break they risk losing out on valuable extra holiday money by leaving it so late to exchange their cash.”
This week saw the pound hit a two-year low against the dollar, as the prospect of a no-deal Brexit moved closer. The pound was down 17 per cent since the EU referendum in June 2016.
The slump, however, does not excuse the dismal rates offered at airports. Online Post Office, Moneycorp and Travelex were all selling at €1.08.
Across the airport outlets surveyed by FairFX, the average rate was €0.90. All offered reductions against the market rate of at least 15 per cent.
A spokesperson for Travelex said the rates reflected “the convenient, reliable service which allows customers to access more than 40 currencies at the last minute”, and they cover overheads at the airport. Moneycorp and ICE, too, said the high rates were down to the cost of operating at an airport. All advised customers to book their money in advance.
Below Telegraph Travel consumer editor Nick Trend gives five tips on how to get the most from your travel money.
Five top tips for managing your travel money
1. Avoid airports
Do not rely on buying currency at the airport. You are part of a captive market. Rates are rarely competitive with those available on the high street.
2. Use credit cards, but carefully
Generally, paying by credit card gives you a better rate than paying by debit card or cash. But this advice doesn’t apply if you are not able to clear the balance each month. The interest you pay on that balance will only add to your costs.
3. Consider a currency card
Get a competitive bank or currency card. The best pre-paid varieties now offer excellent value. I use the Monzo card (monzo.com) which charges minimal fees, offers near “perfect” exchange rates (ie you aren’t stung by the difference between a buy and sell rate) and allows you to always keep the balance in sterling without having to convert into a specific currency in advance. Alternatively the Halifax Clarity card is one of the best value credit cards for using overseas (halifax.co.uk/travel).
4. Lean towards the local currency
If you are offered the choice between paying a card bill in sterling or the local currency, opt for the local currency. This option is being offered more and more often - both at restaurants, shops and hotels, and at cash points. It is highly unlikely that the vendor or their bank will offer you a rate on sterling which is better than you will get automatically from the card issuer.
5. Hold on to your cash
If travelling to the eurozone, or another country that you visit regularly, keep some cash in hand and take it home with you so that you have a small float to take with you next time you visit.
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