Brendan Burgess
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A friend of mine is traveling to Poland and wants to know the best way to pay for things?
Debit card?
Credit card?
Withdraw cash?
Brendan
Debit card?
Credit card?
Withdraw cash?
Brendan
Best way to pay for things on holiday in Poland?
- Thread starter Brendan Burgess
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Brendan Burgess
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Here are AIB's debit card charges
So buying something for the equivalent of €100 with the card will cost €101.75. I assume that they use the mid-rate for the currency exchange, so there is no cost there.
Taking out €100 cash would cost €103.50 (2.5% currency conversion and 1% commission)
So buying something for the equivalent of €100 with the card will cost €101.75. I assume that they use the mid-rate for the currency exchange, so there is no cost there.
Taking out €100 cash would cost €103.50 (2.5% currency conversion and 1% commission)
Brendan Burgess
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Paying with a credit card is the same cost as with a debit card - €101.75
To take out cash on a credit card would cost €103.25 (1.5% cash advance + 1.75% currency conversion)
However, if she lodges euro to her credit card in advance so that it is in credit, she would not be charged the cash advance fee.
So taking out cash would cost only €101.75?
Summary
Paying with a credit card or debit card is the cheapest.
Taking out cash is cheapest with a pre-loaded credit card.
Is that correct?
Brendan
Hello Mr. Burgess,
We were in Krakow a couple of years ago and used cards for almost everything, they were widely accepted.
I would concur with your findings above (although it may be worth double checking that AIB won't charge a cash advance fee if the card is in credit.. just in case
)
Also, as some credit cards may provide purchase insurance it could be advantageous to use a credit card, rather than a debit card. Sorry, I am not familiar with AIB's credit cards so cannot be specific in relation to this point.
We were in Krakow a couple of years ago and used cards for almost everything, they were widely accepted.
I would concur with your findings above (although it may be worth double checking that AIB won't charge a cash advance fee if the card is in credit.. just in case
)Also, as some credit cards may provide purchase insurance it could be advantageous to use a credit card, rather than a debit card. Sorry, I am not familiar with AIB's credit cards so cannot be specific in relation to this point.
There is a margin built into the FX rate applied, but I think it's the same for ATM and POS with AIB as they all clear through Visa.
As with any country, if the merchant (especially hotels) offers to charge you card in Euro say no as the FX rate applied is terrible (you avoid the cross border charges from AIB, but it doesn't compensate except maybe for low value transactions).
Edit: forgot not everything is Visa! there is a marginal difference between the Visa and MasterCard rates. Both publish rates once daily and these are what AIB use.
As with any country, if the merchant (especially hotels) offers to charge you card in Euro say no as the FX rate applied is terrible (you avoid the cross border charges from AIB, but it doesn't compensate except maybe for low value transactions).
Edit: forgot not everything is Visa! there is a marginal difference between the Visa and MasterCard rates. Both publish rates once daily and these are what AIB use.
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Brendan Burgess
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Are you sure?
I thought that credit cards use the mid rate.
Just check this calculator and it seems to be the mid-rate.
https://www.visaeurope.com/making-payments/exchange-rates
Brendan
Looking at it, it's actually quiet small. Visa appear to have a number of currency pairs with a tiny spread, but it'd be more noticeable with more random currencies.
They only set the rate once per day, for the next day, so there is a tiny spread added in to cover their risk. If you did the same conversion on MasterCard website you might notice a few cent difference (I was using PLN).
Off topic, but the banks cross border handling fee is completely unjustified nowadays as the FX conversion is all done by Visa / MasterCard and the bank settle in Euro.
Brendan Burgess
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Hi Red Onion
I don't want to make it too complicated. There is a 1.75% conversion fee for buying goods with a credit or debit card - but no material other cost? Is that right?
Correct, except for very large purchases, for an AIB customer (other banks might have different fees). For AIB the minimum fee applies for all transactions under Eur25.70.
Note: All Irish banks apply a Cap on FX fees on Debit cards, but NOT on Credit cards. It might apply for example where paying for a hotel bill for a week.
Whether or not a case advance fee applies for pre funded credit card, depends on the specific type of AIB credit card. It applies in all cases for Click and be cards.
Edited: re Maximum charges.
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and the Visa spread in FX rates using live data is about 60bps between buy / sell rates.
This is immaterial as 'mid' rates are only available for large volume transactions. Cards like Revolut apply a similar spread but are obscure about it. It compares to a spread of about 6% on buy / sell rates in your local branch.
If you want cash, the cheapest way is to use your visa card at the foreign ATM (unless you are bank staff or somehow else qualify for commission free FX). Like with point of sale, avoid ATM's that will charge your card in Euro as the FX rate is poor - you'll see these typically from banks you've never heard of in Airports.
100.00 Polish Zloty = 23.70 Euro
* * * * *
1 Polish Zloty = 0.2369650000 Euro
- Or -
1 Euro = 4.2200324943 Polish Zloty
23.70 Euro = 100.63 Polish Zloty
* * * * *
1 Euro = 4.2459960257 Polish Zloty
- Or -
1 Polish Zloty = 0.2355160000 Euro
This is immaterial as 'mid' rates are only available for large volume transactions. Cards like Revolut apply a similar spread but are obscure about it. It compares to a spread of about 6% on buy / sell rates in your local branch.
If you want cash, the cheapest way is to use your visa card at the foreign ATM (unless you are bank staff or somehow else qualify for commission free FX). Like with point of sale, avoid ATM's that will charge your card in Euro as the FX rate is poor - you'll see these typically from banks you've never heard of in Airports.
100.00 Polish Zloty = 23.70 Euro
* * * * *
1 Polish Zloty = 0.2369650000 Euro
- Or -
1 Euro = 4.2200324943 Polish Zloty
23.70 Euro = 100.63 Polish Zloty
* * * * *
1 Euro = 4.2459960257 Polish Zloty
- Or -
1 Polish Zloty = 0.2355160000 Euro
That is probably the most important thing to keep in mind and confirms my suspicions. I have a feeling it's the same across all card providers, so no one should make assumptions, just because their card is in credit. The old transaction costs can sting a bit, particularly if the person is using the ATM regularly to make smaller cash withdrawals (which would not be unusual, given most people rather the security of having less cash on them).
Eithneangela
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+1 to Revolut.
I would never go abroad without bringing a good supply of local currency in cash, and then use debit or credit card for additional spending. It might not be the cheapest option but if you rely on card alone you take the risk of your card not working, a security hold being put on the card due to unusual activity - last time this happened to me I was on hold for 45 minutes to get it lifted, catastrophic bank failure or the card being stolen.
To spread the risk when travelling I split the money between various bags and pockets, and then once arrived I only carry enough to do me for the day and the rest gets put in the safe.
I mention catastrophic bank failure as I worked in Ulster Bank during their 'incident' and was amazed at how many people arrived on their holidays with only their one debit card and not a penny in cash and were left completely stuck!!
To spread the risk when travelling I split the money between various bags and pockets, and then once arrived I only carry enough to do me for the day and the rest gets put in the safe.
I mention catastrophic bank failure as I worked in Ulster Bank during their 'incident' and was amazed at how many people arrived on their holidays with only their one debit card and not a penny in cash and were left completely stuck!!
Daddy Ireland
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Instead of bringing a good supply of local cash I would advocate in the case of Poland bringing a good supply of Euro and converting it at a Kantor exchange. For example today €500 would purchase 2100 zloty at a Kantor in Krakow. Heading instead to a credit union today €500 would get you 2047 zloty.
Absolutely agree. I forgot to include that as an option for cash. Spreads on EUR or USD tend to be very low in a lot of countries where they're in high demand. I've done this a few times in Russia.
Absolutely agree. The solution here is not cash nor AIB debit card nor AIB credit card.
The solution is Revolut with no FX conversion fee and no FX transaction fee. (0.5% fee at weekends).
Simply download the app and request a card.
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Revolut would buy you 2122 zloty with the same 500 euro today. You get interbank rates with Revolut.
Right, that's me convinced! I've started installing the app and will give it a try. When I was comparing FX rates I didn't realise Revolut add a margin at weekend, so looks a lot better midweek.