Credit card companies must come clean

12.00.00am BST (GMT +0100) Mon 30th Jun 2008

Scots MEP Elspeth Attwooll is insisting that credit card companies come clean over the extortionate hidden costs of withdrawing cash from holes in the wall in other EU countries.

Many cards apply hidden foreign usage charges, which are especially costly should you be using your credit card to withdraw cash from a machine in another country. These can include:

• A 'loading' fee. Most card issuers charge such a fee as soon as we use our card abroad - typically around 2.75% but sometimes higher.

• If we are using the card to withdraw cash, another fee of about 2 or 3% may immediately be slapped on (i.e. if you withdraw £10 the fee is £2-3).

• The interest rate is often much higher for withdrawing the cash - in certain cases above 20%.

• This interest rate may then be applied from day one - so even if you pay your bill on time you are charged interest between the time of transaction and date of payment.

• The exchange rate is also usually less competitive, especially with the € so strong against the £.

Elspeth Attwooll MEP said:

"I'd urge people to check with their card provider before they go on holiday to check what charges they are liable to pay. But I see no reason why there should be such a discrepancy between charges and interest rates for paying by plastic and withdrawing from machines in other parts of the EU.

Banks and credit card companies should come clean over the charges they apply and why. Otherwise the Commission should investigate in the same way it did over mobile phone roaming charges".

George Lyon, number one on the Lib Dem Euro list for the 2009 elections, added:

"Going on holiday is expensive enough as it is without these hidden charges, especially with the euro so strong. We need the European Union to act so that consumers are fully aware and protected in situations like these".

ENDS