So you’ve just found the perfect souvenirs whilst shopping abroad. Naturally, you reach for your credit card to make the purchase. But is that the best option?
Over a quarter (27 per cent) of Australian travellers automatically use their credit card when making overseas payments despite knowing they might pay more, a new study has found.
Commissioned by website Money Transfer Comparison, the study also asked respondents whether they would continue to pay by credit card if they knew a secure transfer platform with lower fees for international purchases existed.
While most (88 per cent) said they would choose the transfer, one in eight (12 per cent) said they would still be happy to use their credit card, regardless of the extra fees they may pay.
Money Transfer Comparison founder and managing director Alon Rajic warned Aussies that neglecting to do a little research prior to jetting off could cost a lot of money.
“Aussies are wasting countless dollars on unnecessary fees, which can easily be avoided by doing some desktop research that will take under two minutes,” he said.
“The cost of using a credit card abroad consists of three different fees that make credit cards, in some instances, cost more than 10 per cent of the transaction’s total value.”
Who cares?
Whilst generally being more tech-savvy, younger travellers are actually spending less time researching online the most cost-effective ways to make overseas purchases.
According to the study, 69 per cent of 18 to 34 year-olds are doing their groundwork before travelling, compared to 74 per cent of 35 to 50-year-olds and 77 per cent of Australians aged 55 and over.
However, younger Aussies (18-34) are the most likely to opt for a bank transfer platform with lower fees if they are aware of one, with 91 per cent willing to do so, compared to 88 per cent of 35 to 54-year-olds and 85 per cent of Australians aged over 55.
The simple takeaway here for travel advisors and other professionals, is to always ensure your clients know that there are multiple options available to them for making overseas payments – each usually with their own advantages and disadvantages. And the easiest option mightn’t always be the most cost-effective.
The independent study took into account the opinions of over 1,000 Australians.
Another study released earlier this year found that the vast majority (91 per cent) of Australians do not know what an exchange rate is or understand how fluctuations in exchange rates impact travellers’ purchasing power whilst abroad.
