Martin Lewis has revealed that a simple switch to a specialist card could save holidaymakers from paying an extra 2.75% to 3% on every purchase abroad. This hidden fee, known as a non-sterling exchange rate fee, is added by most high street banks and quietly increases the cost of spending overseas.
In a clip shared on This Morning's official TikTok, the MoneySavingExpert founder explained how these fees work. He noted that a £100 purchase effectively costs £103 due to the markup, but switching to a specialist card allows travellers to access near-perfect exchange rates without the extra charge.
Surge in Searches for Best Cards
SEO expert AI SEO analysed Google search trends and found a 55% surge in Brits searching for the 'best card for abroad', indicating growing interest in reducing credit card fees while travelling.
Martin explained that when you spend on plastic overseas, your bank gets a near perfect exchange rate on the day, known as the spot rate. However, most card companies add a non-Sterling exchange rate fee of between 2.75% and 3%. This means your £100 worth of euros costs you £103. The solution, he said, is to use specialist cards that do not have this fee, allowing you to get the same near-perfect exchange rates that banks use.
Recommended Cards
Martin highlighted several options, judging them on the cashback they offer. The Barclaycard Rewards credit card currently gives 0.25% cash back on spending in the UK and abroad, providing a perfect exchange rate and cashback. However, he issued a crucial warning: only use a credit card if you will pay it off in full at the end of every month to avoid interest charges.
For those who prefer a debit card or want to avoid a hard credit check, Martin recommended the Chase card. It can be applied for without switching banks and only does a soft credit check, so it does not mark your credit file. The Chase card offers near-perfect exchange rates, no ATM withdrawal fees, and some cashback on UK spending.
Alternatively, for those willing to switch banks, First Direct offers a near-perfect exchange rate fee debit card and pays £175 for switching your bank account.
