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With more than 100,000 England fans expected to head to Germany for the World Cup this year fans are being warned that slapping holiday expenses on their credit cards could cost them near £800,000 in foreign transaction fees.

It is likely that fans will use their cards abroad as a convenient and secure way of spending, but the fees applied to each transaction will soon add up and each trip to the bar may be costing much more than they think, says Tiscali's partner price comparison website moneysupermarket.com

For example, using a credit card to purchase a round of drinks in a pub worth 30 euros would be subject to an average fee of 2.75% each time. With seven World Cup games – if England play in the finals - this would amount to £393,550 in wasted fees alone. Cash withdrawals are even more punitive – fans withdrawing 100 euros just twice on a credit card could be subject to £2.00 each time in ATM charges, or £400,0004 collectively. In total Brits could be wasting almost £800,000 in fees alone.

Not only this, but for a card such as the Halifax One credit card, the interest rate would jump just over 40 per cent from a standard rate of 15.9% APR to 22.95% for cash withdrawals and interest on the purchase starts accruing immediately – a common practice with credit cards.

"British fans need to make sure they do not solely rely on their credit card for purchases because not only are credit card fees abroad expensive, they are not widely used in Germany. German consumers tend be reticent about paying for everyday items on credit because of the social stigma associated to unsecured borrowing. Our advice to fans is to take a credit card that has low foreign transaction fees such as the Nationwide or Saga credit card," said Robert Kenley, head of credit cards at price comparison website moneysupermarket.com.

"If fans do use credit cards they need to wise up to loading fees and ATM charges and also the practice of dynamic currency conversion, where retailers convert the price of the goods due to be paid for from their domestic currency, such as euros, into British pounds at their own conversion rate. This is not always evident when you sign your bill and a few beers may mean this sneaky method goes unnoticed."

Table showing typical costs for the top three credit cards when used abroad compared to MoreTh>n, a typical credit card

The key pitfalls to watch out for

1. Foreign currency charge - Most providers levy a foreign currency charge (typically 2.75%) on all purchases and cash withdrawn overseas. Nationwide is the only provider not to levy a foreign currency charge on purchases and cash transactions anywhere in the world. However, Nationwide currently charges a minimum of £2 for using a cash machine both in the UK and abroad.

2. ATM withdrawal fee - Many also charge an additional charge of up to £2 or 2% (whichever is greater) if a consumer uses their card to withdraw cash from a foreign ATM.

3. Higher interest rate charged on cash withdrawals – Cash withdrawals incur a much higher rate of interest than normal transactions.

4. No "interest free" period on cash withdrawals - In addition to a higher rate, interest is charged immediately when a cash withdrawal is made. Any interest free period that applies to purchases made on the card do not apply to cash withdrawals.

5. Dynamic Currency Conversion – Dynamic currency conversion is where retailers convert the price of the goods due to be paid for from their domestic currency, such as euros, into British pounds at their own conversion rate. This is not always evident when you sign your bill – so watch out.

"It will be all too easy to get carried away with the excitement of the World Cup and forget about the charges you are likely to incur when you use your credit card abroad. But when the tournament is over and your credit card bill comes in, you may wish you’d substituted your existing credit card to one with lower or no fees ahead of your trip," said Robert Kenley.

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