Brits paying a fortune on credit card cash withdrawals : Credit Card Guide

Brits paying a fortune on credit card cash withdrawals

According to one of the UK's best known price comparison websites consumers in the UK are withdrawing a fortune from cash machines using their credit cards, and as a result of this are being hit with huge fees, enabling credit card companies to rake in the cash.

Often consumers are withdrawing cash without even thinking about how much it will actually cost them once fees and charges have been added, when in actual fact they could just as easily have made their purchase directly with their cards, thus avoiding these charges.

According to Moneysupermarket.com nearly £8.5 billion is being taken out of cash machines on credit cards every year by Brits, and this is costing them a fortune in terms of the charges that they are paying. According to officials just one withdrawal of £20 each could cost consumers around £65 over the course of the year in terms of the fees and charges that they will have to pay. This equates to withdrawing £120 over the course of the year and paying over fifty percent again in charges.

Credit Card Charges
Credit cards appear to have only one cost to a user – the interest charged on purchases, but there are a whole raft of hidden charges just lurking below the surface. So, some cards offer an annual payment option in return for certain benefits. What is the best option, and in what circumstance

Although there are some cards that do not charge commission for cash withdrawals, they are few and far between, and in most cases cardholders will be charged between £2.50 and £5.00 for each withdrawal that they make. Even those that repay their balances in full at the end of each month will be hit with these charges for cash withdrawals, and they can quickly mount up costing the cardholder dearly. Officials from Moneysupermarket have urged consumers to think very carefully before deciding to withdraw cash on their credit cards if they can just as easily make payment directly through the card.

Tom Smith
9th October 2007

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