I used the Post Office's "zero commission" foreign currency service for my holiday money. I placed my order online, nominated my local sub-post office as the point at which I would like to collect my currency and used my Visa debit card to pay. When I received my bank statement I was amazed to find that on the same date as the debit for the sterling amount I was paying to the Post Office there was a second debit described as "Visa charge" representing 2% of my payment. So the zero commission transaction had actually cost me 2% more than I was anticipating. Can anyone explain the rationale for this? Why is this different to any other sterling purchase? PR, Langdon Hills, Essex
We have no idea why foreign exchange charges are treated as foreign cash purchases taken abroad, but they always have been. In fairness, the Post Office website clearly states: "If you pay by credit or debit card you may be charged a cash advance or other fee by the card issuer. You will need to bring a valid passport or photocard driving licence when collecting your order from branch."
The only advice we can give is to take the cash out of the ATM and hand it over in person, although you can't do this if you use the website. When we looked into finding the best exchange rates, they tend to be from a company called Ice, International Currency Exchange, although pricing policies change so check first. They have several branches – allowing you to pay in person, in cash. Its best rates are usually to be found at its Waterloo station branch in London.
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