Search for the best exchange rates – picture by Flickr user Images of Money
A Sunday Times report found that customers are being charged up to 8% more in foreign exchange rates in airports than online.
Companies offering ‘commission-free’ transactions are not necessarily any cheaper either. The increase in their prices are often made up through the rate they give. A customer changing £500 could be charged £40 more than on a more competitive online rate.
The issue is that when customers buy at an airport, they are forced to take the rate that they are given, as there is nowhere else to go. This ‘convenience’ is one of the reasons companies give for charging more. Other factors include higher rents for retail spaces at airports, as well as higher insurance, and the cost of transporting the money for the consumer’s convenience of buying at the airport.
The Financial Services Authority confirmed that is does not regulate foreign exchange rates. A spokesperson for the Office of Fair Trading said they had not ‘written off’ the issue, but companies had so far provided a good argument for the higher charges.
Martin Lewis, founder of the Moneysavingexpert.com, said: “We have a real problem with the lack of foreign exchange currency legislation. The advice is don’t just go and change at the airport. They can charge what they like.”
Advice to avoid the sting of higher charges would be to avoid buying at the airport, plan in advance and use an online comparison tool to get the best rate, such as moneysavingexpert.com’s online comparison tool.