MSE News

First Direct debit card goes fee-free for overseas spending meaning near-perfect exchange rates

First Direct has scrapped all fees for overseas spending and cash withdrawals on its debit card for both new and existing customers, can reveal. 

The move is a boost for existing First Direct customers as the account is already one of our best buys. For switchers, you can also get First Direct's £175 bonus on top, though there are other specialist overseas cards that can be marginally cheaper if you're happy to have more accounts. 

Below we explain what's changed, and analyse how First Direct now compares to our top pick cards for overseas spending. If you're looking for the cheapest way to spend overseas, see our Top cards for travelling abroad guide.

What's changed with First Direct's overseas fees

As of Wednesday 28 June, First Direct has removed the following fees:

  • Non-sterling transaction fee. This was previously 2.75% and applied to both purchases and cash withdrawals in foreign currencies.

    For example, if you spent £100 in a foreign currency, such as euros, dollars or dong, this would cost you £102.75. 

  • Non-sterling cash fee. This was an additional 2% fee (minimum £1.75, maximum £5) that was charged on cash withdrawals (it applied on top of the transaction fee).

    So withdraw £100 worth of euros in Spain, for example, and it would cost you £104.75. Note that foreign ATMs may still charge you to take money out – but these fees are not set or taken by First Direct itself.

Now these fees have been removed, you get the same near-perfect exchange rates that the bank itself gets – meaning there is NO extra cost for spending or withdrawing cash on your First Direct debit card overseas (or on foreign websites in the UK).

The changes apply automatically to all existing First Direct debit card holders, as well as to new customers.  

It's worth noting that the changes do not affect the bank's credit cards – you'll still pay fees of 2.99% if you use your First Direct credit card abroad. HSBC debit and credit cards are also unaffected (First Direct is part of the HSBC Banking Group).

The changes make First Direct's debit card a top pick for use overseas – though other specialist cards are a bit cheaper

Making its debit card fee-free overseas means First Direct is now one of our top picks for spending abroad if you prefer to just have one account – as you'll no longer pay more to spend or take out cash overseas. Plus, if you're new to the bank, you can get its £175 switching bonus (as well as the other benefits it offers).

But if you don't mind opening another account, there are slightly cheaper ways to spend abroad. That's because, in addition to giving near-perfect rates and not charging fees, our top-pick specialist travel debit and credit cards also offer ongoing cashback on spending or sign-up bonuses:

  • The Chase debit card pays 1% cashback up to £15 a month for at least 12 months on most overseas and UK spending. And there's no hard credit check required (just an ID check).

  • The Halifax Clarity credit card gives a free £20 on your first purchase (of even 1p) within 90 days – though as it's a credit card, you'll need to pass a full credit check and ensure you pay it off IN FULL each month to avoid interest on spending.

  • The Barclaycard Rewards credit card pays 0.25% cashback on most UK and overseas spending – though again, there's a full credit check and you'll need to ensure you pay it off IN FULL each month to avoid the interest.

For full info on how these cards work, see our Top cards for travelling abroad guide.

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