First Direct scraps debit card fees when abroad
First Direct customers now get FREE spending abroad as the bank fights back against challengers
- First Direct is scrapping its foreign transaction fees and joining only a few other banks
- The median foreign transaction fee faced by debit card holders is 2.75%
First Direct no longer charges its customers for using their debit card abroad, as do a handful of other UK banks.
There are no additional transaction costs or surcharges when using the card outside the UK, with the rate being determined purely by Mastercard’s exchange rate.
Most debit cards charge a non-pound transaction fee and a cash withdrawal fee each time customers use their card abroad.
New customers with a First Direct checking account receive a cash bonus of £175 if they pay at least £1,000 within three months, and there are now no extra charges when spending abroad
The median foreign transaction fee faced by debit cardholders is 2.75 per cent, according to Fairer Finance, while a typical debit card also charges £11.88 when customers withdraw £250 in cash abroad, according to Moneyfacts’ analysis.
First Direct becomes one of the few banks that does not charge these expensive transaction fees. It also includes cash withdrawals from ATMs around the world.
However, it is worth noting that some ATM operators may charge a direct fee for withdrawals from their ATMs, and this should be indicated on screen at the time of withdrawal.
On top of the free spending abroad offer, First Direct also pays a generous £175 switching bonus, £250 interest-free overdraft and a 7 per cent regular savings account.
It’s worth pointing out that First Direct credit card customers continue to charge a 2.99 percent transaction fee when spending abroad.
Chris Pitt, chief executive at First Direct, said: ‘At First Direct, we are committed to supporting our customers as they navigate the rising cost of living.
‘That’s why we say goodbye to transaction and withdrawal costs on our current account, so that customers can travel optimally without having to worry about extra costs.
“We hope this will give people extra peace of mind to enjoy their hard-earned vacation.”
Which other banks offer free debit cards abroad?
HSBC customers have access to the new Global Money service, which customers can request if they have an active HSBC current account.
Customers can order a multi-currency debit card upon request and it can be used at home or anywhere for free.
This debit card allows them to spend or withdraw cash with no foreign transaction fees from HSBC.
New digital bank Chase also charges no foreign transaction fees.
No fees or charges: Abroad, Chase charges no fees for using his account
It also allows its customers to withdraw up to £500 from ATMs every day. However, if you travel abroad, you can withdraw up to £1500 each calendar month.
Starling Bank checking account also offers free debit card withdrawals and card spending abroad.
Like Chase and First Direct, it passes Mastercard’s real exchange rate and adds nothing to it.
It does limit cash withdrawals to six per day, with a daily limit of £300, so it’s worth bearing that in mind if you’re planning to exceed that amount on any given day.
Free: The debit card that comes with the Starling account does not charge for card spending or cash withdrawals anywhere in the world
Monzo customers can also use their debit card abroad for free.
However, there is a 3 per cent fee if you withdraw more than £250 in cash in 30 days in the UK and the European Economic Area.
Outside of Europe, customers will be hit with the 3 per cent fee if they withdraw more than £200.
For £5 a month, Monzo customers can instead opt for the Monzo Plus account which allows them to withdraw up to £400 each month for free, anywhere abroad.