Avoid withdrawing cash before traveling abroad

Euro Euro.Photo: Dinero

Are you considering exchanging money, or withdrawing cash in Norway before traveling abroad? This can make your holiday more expensive.

At this time of year, many Norwegians are ready to take their holiday weeks, which are more often than not, spent abroad. One question that always arises is whether to withdraw money in Norway, or exchange currency before leaving.
 
The answer is that you should avoid doing both things. The cheapest way to travel is to withdraw money wherever you go!
 
Most northerners travel to Greece, where the currency is the euro. With ATMs full of euros conveniently located at the airport in Norway, many Norwegians fall for the temptation to withdraw cash before departure. They don’t all know that these mini-banks in Norway will give them a disadvantageous exchange rate.
 
Norway’s largest bank charges NOK 10.03 per euro for withdrawals at the airport. One euro costs 9.69 kroner at VISA’s rate, and 9.71 at MasterCard’s, and these are what will determine your exchange rate when using your card abroad, and the cards’ usual currency rates are taken into account (which would be 1.75% in this example ).
 
Concerning Norwegian airport banks disadvantageous exchange rate, Anders Fagereng at Dinero.no  said, ‘The airport’s exchange rates are soaring. For a family spending a total of 2000 euros on holiday, this will amount to well over 600 kroner. That is 600 kroner that could have been saved if they had only waited to withdraw money once they had arrived at the holiday destination’.
 
Also, when it comes to Thailand’s baht currency, the price difference is high. If you withdraw 50,000 baht at Gardermoen airport before departure, it will cost you a little over 1000 kroner more than you can expect to pay if you withdraw the money when you arrive in Thailand, where both currency discounts, and Thai ATM’s standard fee of 220 THB are included.
 
There are several currency exchange affiliates scattered around Norway. They are marketed with the slogan, ‘Don’t travel without cash – exchange currency free of charge’, but forget to mention that the rate they’ll give is at least as bad as the ATMs at the Norwegian airport.
 
Using the same 2000 euro example as previously, it will cost over 700 kroner more to withdraw 2000 euros in Norway by comparison to taking it out abroad.
 
It doesn’t help to get a good exchange rate if the credit or debit card you use generates high withdrawal fees.
 
Some credit cards are happy for you to pay a high fee of 30 to 40 kroner in addition to a percentage fee of your withdrawal amount when you withdraw money abroad. Some will charge immediately from the withdrawal date, and a number of debit cards will charge fees for cash withdrawals abroad.
 
‘Go to the price list and read the small print to see if you should look for better alternatives. If you’ll get high fees, you should go out soon and find a better product well in advance of your trip’, advises Fagereng.
 
In Dinero.no’s credit card test, you’ll find a good overview of the different fees and interest rates on the most used cards in Norway.

Remember also that when asked in shops, restaurants or ATMs whether you would like to pay in Norwegian kroner or the local currency, as a rule of thumb, ALWAYS choose the local currency, as this can save you a small fortune while on holiday.

 

Source: Dinero / Norway Today

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