Are you packing a fee-free debit card for your overseas jaunt this summer?
Tuesday 26 November 2019
As we approach the final weeks of 2019, many Aussies will be keeping half an eye on their calendar as they count down the days until it's time to head to the airport for their summer holiday abroad.
But while the focus leading up to departure day will most likely be on flights, accommodation and sightseeing ideas, one oft-neglected area of preparation is how to actually pay while overseas.
It’s not as though Australian travellers are without travel money options though, with travel debit cards, travel credit cards, prepaid travel cards, good old cash and even fintechs like Transferwise and Pellkin all offering ways to pay.
But here’s the rub: many of these options come with a cost attached and it’s not necessarily a small one.
In fact, according to research from Capital Economics, in 2018 Aussie travellers forked out a whopping $2.14 billion in fees in order to access their own money overseas. That included costs like foreign exchange fees, overseas ATM withdrawal fees, card ownership fees and exchange rate markups.
But do Aussie travellers actually need to be paying fees? Well in the case of bank accounts and debit cards, the answer could be no.
According to Mozo figures, 9 of the 178 different bank accounts (around 5%) currently being tracked in the Mozo database don’t charge any overseas ATM withdrawal fees or foreign exchange fees.
Nor do any of those nine accounts come with ongoing account fees, though there may be deposit or card requirements you’ll need to reach in order to be eligible for a fee waiver, plus the actual ATM operator you withdraw money from or the vendor you swipe your card with may charge an additional fee.
So be sure to check out the linked reviews below for more information.
Bank accounts with zero foreign exchange and overseas ATM withdrawal fees
|Citi||Global Currency Account|
|Citi||Plus Transaction Account|
|HSBC||Everyday Global Account|
|ING||Orange Everyday Youth|
|Macquarie||Platinum Transaction Account|
|UBank||USaver Ultra Transaction Account|
“While flights and accommodation may be top of the priority list, many Australians neglect comparing travel money options like travel-friendly debit cards and credit cards at all,” said Mozo Director, Kirsty Lamont.
“Foreign exchange and overseas ATM withdrawal fees can really add up though, potentially to the tune of hundreds of dollars out of a travel budget, so it’s never a bad idea to do your research before you fly.”
So how much could a fee-free bank account option actually save you? Let’s look at an example.
Kevin and Jodie are heading over to Europe for a five week getaway over the summer holidays, during which they’ll be visiting a bunch of countries, including the UK, Spain, Portugal and France.
The couple anticipate spending about $120 per day using their debit cards on accommodation, food, travel, sightseeing and souvenirs, plus they’ll withdraw cash from an ATM about once a week to use for smaller purchases.
If Kevin and Jodie used a debit card with the average foreign exchange commission in the Mozo database (2.65%) and the average overseas ATM withdrawal fee ($3.50) they would end up paying $128.80 in card fees over the five weeks.
That’s $128 that couple be better put towards your travel budget for a night out or on a new experience, rather than on fees.
Ready to compare even more bank accounts? Check out some of the great offers available below, or to learn more about travelling fugally then be sure to read our comprehensive guide on how to avoid fees when spending overseas.