Nationwide is pushing up overseas spending charges for millions of its debit card customers today.

The changes end the fee-free overseas spending perk the building society has bragged about for years on its FlexAccount.

In fact, a whole raft of credit cards will become substantially cheaper than Nationwide's debit card provided you pay off the card balance each month (see the Cheap Travel Money guide).

New charges

Nationwide has generally avoided adding overseas commission charges, typically 3% of the transaction, on its debit card.

It is introducing a new 2% fee for European currency and is doubling its charge for worldwide currency from 1% to 2% (the 1% fee came into force last year). This means 100 of foreign spending actually costs 102.

The society is also introducing a new 1 withdraw charge to take out cash, in addition to the commission.

These charges, which are still lower than most rival debit cards, are part of a general revamp which will see current account customers who pay in at least 750 a month given annual European travel insurance.

No change to Nationwide credit card

Nationwide's credit card is not changing. It will still be fee-free for European travel, with a 1% charge for other currency.

On top of this, you'll be charged around 2% per month interest on cash withdrawals even if you repay the card in full, and a 2.5% fee each time you use an ATM (see how this compares in the Cheap Travel Money guide).

Our view

Martin Lewis, MoneySavingExpert.com creator, says: "This is a guillotine through the neck of Nationwide's reputation as a cheap account for overseas spending. Credit card loading is a nasty hidden fee Nationwide has bitched about other banks levying, yet now it's doing it too.

"The building society is actually trying to kick nearly a million customers out of the door. That's because of its 3 million+ account holders, 1.4 million use the debit card overseas and 900,000 of those use the account ONLY for that and that costs.

"So Nationwide wants them gone to ensure it's focusing on people using their account 'properly', as it sees it."

Further reading/Key links

Get cheap currency: TravelMoneyMax.com, Cheap Travel Money
Watch Nationwide's 'No overseas charges' advertisement