High street bank with 3million customers to start charging fees to use debit card abroad within weeks
A HIGH street bank will start charging customers to use their debit cards abroad later this summer.
Metro Bank is set to introduce a 2.99% fee on all debit card transactions made outside the UK from August 29 – including in Europe, which is currently free, The Sun can reveal.
And customers withdrawing cash from their bank account anywhere abroad will pay the 2.99% fee plus an additional £1.50 ATM fee.
Metro Bank, which has around 3million customers, currently allows them to spend on their debit cards and make cash withdrawals in a foreign currency in Europe free of charge.
But last week, it emailed customers to let them know it would begin charging for transactions made in all foreign countries from August.
The email, sent on June 27, said: “After August 29 2024, debit card payments made in a foreign currency outside the UK will be charged 2.99% on the converted British Pound value of the transaction.
“After August 29 2024, cash withdrawals made in a foreign currency using your debit card outside the UK will be charged 2.99% on the converted British Pound value plus £1.50 ATM fee.
“This charge is applicable for each transaction you make.”
While a 2.99% fee may not sound like much, the charges can quickly rack up as the fee is applied to every individual transaction.
For example, if you spend £20 on your card, you will pay 60p in fees.
So, if you make five £20 transactions, you’ll have spent an extra £3 in fees.
And if you withdraw cash from an ATM, the charges are even higher.
By withdrawing £100 worth of foreign currency, you would incur a £2.99 charge, plus the additional £1.50 withdrawal fee.
This means you would pay an extra £4.49 for taking out £100.
One customer who spotted the change said: “It’s very disappointing to note Metro Bank will be charging the fee. I have had this account for well over 10 years explicitly to use in Europe.
“On occasion there have been large sums in the account, but unfortunately it will be cancelled on August 29. I now need to find another free debit card.”
Metro Bank confirmed the change when asked by The Sun but did not offer further comment.
What do other banks charge?
Most banks offer a way for customers to spend abroad without paying any fees.
Some only allow free transactions in Europe, while others currently have no fees anywhere in the world.
First Direct
First Direct does not charge fees for using a debit card to make a payment in a foreign currency or for making a cash withdrawal in another country.
There is a daily cash withdrawal limit of £500 (or the foreign currency equivalent) at ATMs.
HSBC
Customers with a HSBC Global Money Account can spend abroad and withdraw from cash points fee-free.
Global Money accounts are available to any HSBC customers with an active current account and its banking app.
Other customers will be charged 2.75% for shopping, and 2.75%, plus a fee of 2% for cash.
Lloyds Bank
Lloyd’s Silver and Platinum account customers will be able to use their debit card anywhere in the world free of charge from July 1, 2024.
However, the Silver Packaged Bank Accounts costs £10.00 a month while the Platinum option costs £21.00 a month.
Monzo Bank
Monzo says customers can pay anywhere and in any currency on their debit card with no foreign transaction fees.
And if Monzo is your main bank account, you can make unlimited fee-free withdrawals in the European Economic Area (EEA), and up to £200 every 30 days anywhere else. After that, the bank charges 3%.
Santander
If you have the Santander Edge, Santander Edge Up and Private Account debit cards, you can withdraw money fee-free and you won’t get foreign transaction fees on spending while away.
All other accounts with Santander charge 2.95% for both purchases and withdrawals.
Starling Bank
Starling doesn’t charge for using your debit card while abroad.
TSB bank
If you have a TSB Spend and Save Plus account, you will pay no fees on debit card transactions worldwide.
Other account holders will pay 2.99% in fees on transactions, and 1.5% fees on any money withdrawn.
There are no fees for making a cash withdrawal in Euros from a cash machine in an EEA country.
Virgin Money and Clysedale Bank
If you have a Virgin Money M Plus account, you won’t be charged for using your debit card abroad, although the bank has warned that some ATMs may still charge a fee.
You can read our full guide to other banks which don’t charge fees on foreign transactions here.
If you are exchanging cash into a foreign currency, make sure to shop around and buy ahead.
It’s best not to use the Bureaus De Change in the airport, as they offer some of the worst rates on the market.
Alternatives for holiday spending if you don't want to exchange currency
THERE are several specialist cards that can give you a great exchange rate.
Travel credit cards allow you to spend money abroad without being hit by any fees or hidden charges.
But, they may still charge you for taking cash out.
We recommend the Halifax’s Clarity Card as it won’t charge you for using it abroad, nor are there any fees for withdrawing cash.
But you will be charged interest if you don’t repay your balance in full at a rate of 19.9 per cent.
And you will be charged interest on cash withdrawals until your balance is paid off too, at a rate of between 19.9 and 27.95 per cent depending on your credit score.
For more on travel credit cards you can read our guide here.
Pre-paid cards: An alternative to carrying cash around is to get a pre-paid card.
These cards allow you to put a set amount of cash on the card at a fixed exchange rate.
So if the rate is good at the moment, you can put money on your card and it will stay that rate when you are on holiday.
Just keep in mind that these cards can sometimes have hidden costs and charges so be sure to read the small print.
Do you have a money problem that needs sorting? Get in touch by emailing money-sm@news.co.uk.
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