NatWest is waiving fees for 2.1million customers using their debit cards abroad in shops and restaurants this summer.
The perk will last until the end of August and will save eligible customers from paying the typical £1 minimum or 2.75 per cent fees the bank usually applies for purchases abroad.
According to the bank 2.1million of its existing customers will benefit from the fee discount but those opening a NatWest Reward account or packaged account can also take advantage of the deal. Both charge a monthly fee. NatWest Premier customers are also eligible.
Existing customer perk: NatWest will waive foreign purchase fees for some of its current account holders
A word of warning: you will still have to pay if you want to take money out of an ATM while abroad.
Natwest charges 2 per cent, or a minimum of £2 and maximum of £5, for a cash withdrawal abroad plus a non-sterling transaction fee of 2.75 per cent.
These accounts all come with monthly fees, starting at £2 a month for the Reward Account which also offers 2 per cent cashback on your monthly bills, and appears in This is Money’s round up of the top accounts.
The bank’s Premier customers also qualify. To become a premier customer you must have a sole income of £100,000 or a joint income of £120,000 or more paid into your Natwest account, have a mortgage of £500,000 or more or savings or investments of £100,000 or more with the bank.
According to research from NatWest just two in five people use a debit card for their overseas spending, instead relying on cash they take out before heading off on holiday.
The bank claims this often leads to overestimating the amount of currency Brits need on holiday and four in five therefore return home with excess currency.
Should you open a NatWest account?
The NatWest initiative is great news for existing customers as most high street banks charge between 2 and 3 per cent every time you swipe your debit card abroad.
The Reward Account is already one of our top current account picks as a good everyday account for those looking to earn a little extra from their bank.
It pays 2 per cent back on regular household bills such as gas and electricity and broadband, TV and phone deals, which the bank estimates earns the average customer £83 per year. But remember this doesn’t take into account the £2 monthly fee.
The bank’s overseas perk also only lasts for a short time and only offers fee-free spending on card compared to other specialist deals that spare ATM withdrawals from fees too.
Frequent travellers looking to save money on overseas fees may be better off looking elsewhere.
We have rounded up our pick of the best accounts and credit cards for overseas spending in depth in our regularly updated guide here. But below is a brief list of our favourites.
New app-only challenger bank, Starling, charges nothing extra to use your debit card for both transactions and withdrawals anywhere in the world – the only deal out there to offer both to current account customers, with no limits.
Rival Monzo previously offered the same deal, but it recently added a cap on free overseas withdrawals of £200 per month, with a 3 per cent charge after that.
If you have a Metro Bank debit card you won’t pay anything to use your account while in Europe and Virgin Money’s basic banking option – the Essentials Account – charges £1.50 for withdrawals but applies no foreign transaction fees to purchases. It typically takes five days to arrive according to the bank.
Any other alternatives to a bank account?
Switching your bank account might not be something you are willing to do, particularly if you don’t travel abroad frequently.
So you may want to consider a credit card or prepaid currency exchange card instead.
Again most credit cards charge 2 to 3 per cent to pay by credit card abroad and an extra 3 per cent for ATM withdrawals but there are a few specialist deals that won’t.
These include the likes of Tandem, Barclaycard’s Platinum Travel credit card the Post Office’s Platinum Credit Card, Creation’s Everyday Credit Card, Santander’s Zero Credit Card and Halifax Clarity credit card.
Remember, most credit card lenders apply interest on foreign transactions immediately without the typical grace period offered until your statement date, and sometimes at a higher rate, so make sure to clear the debt as soon as possible.
Prepaid currency cards
Currency cards offer holidaymakers the chance to load up a card with money to spend while they are away and potentially benefit from lower rates.
Loading up a card in advance has the benefit of locking in the rate which means you know exactly what you have to spend.
Travellers should make sure these rates are better than their bank and check all the small print.
FairFX is offering This is Money readers a free MasterCard prepaid card, which usually costs £9.95.
THIS IS MONEY’S FIVE OF THE BEST HOLIDAY MONEY DEALS