Using bank cards in the EU. [Matthew's Journal]

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A cow-orker asserted today that it should be free to use your bank cards in the EU. This link appears to suggest that is the case, yet AFAICT most banks still charge for e.g. using a cash machine with a debit card in Europe. What did I miss?

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There are 8 comments on this entry. (Reply.)

Is a distinction being made between charging to use the machine vs charging commission on the exchange rate? (Interested to hear what people say as I travel to Europe fairly regularly.)

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It only applies between two countries using the Euro. Doesn't apply to us as we don't use the Euro.

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The problem is the UK is not in the Euro-zone. If you have a Euro account on a British bank (I guess some banks must do this .... I remember there was a trend for mortgages in euro a while back), then the regulation will apply too. The 'extension to the Kroner' mentioned lower down the page suggests that if Mr Brown decided it would be good to implement this in the UK, too, we'd have it.

Personally, I would prefer to be in the Euro-zone, but getting an article 9 extension would be a move in the right direction. Which is probably why we don't have it: the press would interpret this as a move towards euro-adoption. If I were a bank, I'd be encourage it to be reported in that way.

The Post Office Credit Card (which I rather think is a bank in Ireland) and Nationwide credit card doe not charge commission on purchases or cash withdrawals, but of course cash withdrawals on a credit card are more expensive than on a debit card. I think the Nationwide is the only commission-free debit card.

If anyone knows of a a euro-account that doesn't cost a lot, and doesn't require that one puts ones salary into it, I'd be interested.

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D'ye know, I just deleted 'but Nationwide is well known as a low-performing bank, so whether the commission-free debit card is worth it is a debatable point' as being potentially slanderous.

Ahem. 'In the experience of a customer known to me, .... it is a debatable point'.

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I got confused, but a friend of mine who was working in a euro-country did something like put money in his bank (er unfortunately I forget the bank. its internet banking requires windows.) in sterling, move it to the same bank in euros on the isle of man or something, then move it from there to a euro bank account in the country he was living in. apparently that saved on the commission, or something.

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Yes, that would work if they had an income in sterling (e.g. they were letting their house while working abroad), but were living in the Euro area. Converting a lot of money is cheaper than converting a little. Getting the sterling-to-euros done within one bank might well be cheaper.

I think most banks offer a Euro account, often off-shore. The problem is (for people like me who spend between 300 and 1000 euro a year on academic publications, holidays, etc), is that they are all either expensive, or you need to put a regular amount into them (along the lines of a salary).

Off-shore Euro accounts won't be in Europe, though, so the 'no fees' bit won't apply. Hence the setting up a real euro account to pay for stuff / get cash, rather than use the off-shore acount.

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Hmm. Last time I did this I don't *think* I was charged a separate fee, but the transaction was converted at the bank's foreign currency exchange rate which may not be the best available.

Since I've just recently been sent a replacement debit card, I happen to have the informational leaflet which came with it handy. It says: "Cash can be withdrawn from cash machines worldwide wherever you see the Maestro or Cirrus symbols. [...] Foreign Currency exchange rates are shown on your statement against each transaction inclusive of an exchange rate adjustment charge - which is currently 2.75% to cover our handling costs and any card processing fees. Overseas cash machine withdrawals will also incur a transaction charge, currently 1.5% (min £1.75), which will be detailed separately on your statement."

That's HSBC by the way.

Probably not a great deal compared to proper ForEx places, but very convenient if you find yourself short.

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Using my maestro, and mastercard in the states, I found I got a pretty good exchange rate on both, and was charged $2 a time to withdraw cash on the maestro, and could almost never pay for things with the maestro. The $2 was imposed by the US bank, not my own.

Since it was mostly on expenses, I didn't pay detailed attention to the numbers, but it really wasn't bad.

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Matthew's Journal

Using bank cards in the EU.

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October