Credit card users warned of overseas risks
An increase in the use of credit cards abroad has been predicted, in the light of a new ruling by the Court of Appeal, but analysts have urged consumers to be aware of the real costs they may face.
The Court has judged that key provisions for card holders under the Consumer Credit Act can apply overseas, with tourists able to claim against the card issuer as well as the supplier for transactions between £100 and £30,000 where there is breach of contract or misrepresentation.
However, financial research company Defaqto has warned that those embarking on a holiday spending spree are likely to encounter steep transaction charges that would not be faced in Britain.
Using your card in mainland Europe will, on average, add 2.66 per cent to the cost of each transaction, while 85 per cent of all credit cards levy an international charge of 2.75 per cent.
David Black, head of banking at Defaqto added: 'When travellers return home and check their statements, apart from the transaction charges, they could also suffer from a poor currency exchange rate.'
'Card holders are also advised to keep an eye on their credit card company's overseas charging levels as providers may try at some time in the future to put up charges to meet new claims brought as a result of the Court of Appeal's ruling,' he said.
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