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Exhange rates/fees - Debit ATM withdrawals vs CC purchases

I'll be going to London for 10 days starting next week, bringing both my Wells Fargo debit card for ATM withdrawals and my Capital One (no foreign transaction fee) Mastercard credit card for CC purchases - my question is, will one cost me any more than the other to use in terms of exchange rate, etc?

I'm inclined to use the credit card as often as possible (for restaurants, pubs, site admissions, shops, groceries, Oyster cards, etc.), just keeping enough cash on hand for very small purchases - does that seem like a reasonable plan?

Thanks in advance.

Posted by
5773 posts

My Capital One Visa converts FX at essentially Interbank rate. My credit union Debit/ATM charges a 1% FX fee. My Cap One is a better deal.

My Wells Fargo would charge a fee plus mark up on Interbank. It's my backup that haven't used.

Other advantage of CC is not having excess FX when you return home.

Posted by
6850 posts

Yes, Wells Fargo will be the worse choice because their fees are > than the zero fees on your Capital One credit card.

It took me a few seconds to find the Wells Fargo terms and conditions online:
Basically 3% of each transaction PLUS $5 fee (see Table 2)
https://www.wellsfargo.com/debit-card/terms-and-conditions/

Wells Fargo is not a good choice for ATM transactions overseas, so just do what you can to limit the bleeding (meaning less transactions).

Posted by
2542 posts

I've done a 360 on this one. Time was I took out large ATM amounts and used cash for nearly everything. I still might do that in some parts of Europe. But, by and large, we are using the credit card more and more. Our cash stash is dwindling as we use it for the stray espresso, craft faire, etc sort of purchase. I think your inclination is correct.

Posted by
1174 posts

That is the perfect plan, each subsequent trip I find myself paying by card more. Even though I'm pretty good at identifying UK coins, I am still pretty slow with them. It is quite common to pay by card for even small purchases in the UK, so I join along with the locals and pay by card even for a pint of beer or a breakfast at Pret.

Posted by
88 posts

On our 5 day trip (two people) I took about £150 in cash and used my Bank of America Travel Rewards Visa (no foreign transaction fees). I have a friend who works for a bank and was able to get a discounted exchange rate on cash. I still figured I would go to the ATM once but I didn't. We used the credit card almost exclusively.

I found using the credit card was the easiest and cheapest way to go (assuming you have a no transaction fee card and have the money to pay off the balance at the end of your trip). Plus, you don't have to stand around and count change. The bills are easy but since I didn't know the change on sight I had to actually read each coin.

Posted by
5766 posts

London is very credit card friendly, you should be able to use it for nearly everything, using cash for only small purchases at smaller retailers or maybe at a market. At any pub, chain coffeeshop, or merchants cards will be accepted for purchases of even a couple Pounds.

Posted by
5324 posts

Credit card is the way to go. I only use my ATM/debit card to withdraw cash, which I only use when I can't use a credit card.
I have credit cards that don't charge a foreign transaction fee/

Carrying a lot of cash is more risky to carry on your person due to pickpockets.

Posted by
3586 posts

Use the Capital One MasterCard credit card for CC purchases since they do not have a foreign transaction fee and use it for most of your purchases. As a general rule (there are exceptions) the difference in the exchange rate used by all the banks is negligible. I would not be inclined to use the Wells Fargo card and would only do so as a back up if the other card did not work for some reason.

Keeping enough cash on hand for very small purchases sounds good on the surface. However, we like to have at least enough cash with us to pay for a few dinners or events in case the credit card does not work for some reason -- and believe me, the credit card systems do malfunction from time to time. Happened to us several times. Technology is great when it works as it should. But sometimes technology is just like a kid who has to act up now and again.