Holidaymakers are finding that £1 buys less than a euro at some airports’ bureaux de change, as the slump in sterling drives up holiday costs.
In the week that sterling slipped to a new three-year low against the euro following the Brexit vote, researchers found that bureaux de change at Stansted and Luton airports were offering just 99 cents for every pound exchanged.
Last month, £1 was buying €1 at some airport currency exchange bureaux, but these rates have now worsened, according to currency specialist Caxton FX, which surveyed the walk-up rates at several airports this week.
Holidaymakers using the Moneycorp exchange booth at Stansted airport to buy currency were being offered just €0.9915 for each £1 exchanged. The rate on offer at the ICE (International Currency Exchange) bureaux de change at Luton airport was even lower at €0.9900.
At those rates, £1,000 would buy €991.50 and €990 respectively.
The weak pound has meant pricier holidays for millions of Britons travelling to Europe, the US and other destinations this summer. At one point on Tuesday, £1 was worth just €1.1476, its lowest level since August 2013. Sterling has since rallied a little, with £1 buying €1.15500. That compares with €1.30 the day before the referendum in June, and €1.42 in August 2015.
The rates offered to those who turn up at airport bureaux de change without pre-booking their holiday currency have long been poor, but appear to have hit a new low. Pre-ordering currency – either for home delivery or for pick-up – is one way that consumers can secure a better rate.
Caxton FX said it obtained the rates over the phone directly from the bureaux. It added that airport bureaux de change had a captive audience, “which means that in spite of poor rates, they will still have a large customer base”.
Alexandra Russell Oliver, an analyst at the firm, said: “The pound fell below 1.1500 against the euro for the first time since August 2013. An already weak pound has faced additional woes recently due to increased stimulus measures and disappointing data from the UK.”
Tracy Bownes, Moneycorp’s retail director, said: “Foreign exchange rates tend to differ between airports and other retail outlets – be it online or on the high street. There are various costs associated with operating at an airport, and this cost model is the main reason behind the varied rates.”
She said customers could access more competitive rates by ordering online via its reserve and collect service, and opting to pick up their currency at a designated airport bureau.
Koko Sarkari, chief operating officer of ICE, said: “We work hard to keep our prices fair and competitive around the world. However, due to differences in distribution, costs of operation, regional competition and other factors such as ongoing volatility in the market, as we are experiencing now, online prices may not be the same as our ICE branch prices, and prices may also vary between branches because of these factors.”
He added that the company offered a number of way for travellers to buy currency, including online, in advance at one of its branches, or even at the last minute at the airport. Sarkari said ICE offered an online service with next-day delivery.
