With credit cards and foreign travel becoming consistently more popular year on year, it is vital to understand the charges and costs involved in using your credit card abroad.

Last year, plastic cards accounted for more than 50% of our overseas spending. The total amount of money spent on British cards abroad added up to a massive £18 billion. On top of that, £7 billion was withdrawn from cash machines abroad.

Most British credit and debit cards can easily and conveniently be used abroad in a whole host of shops and businesses. This is a great advantage to many travellers, however, many are not aware of the hidden costs involved.

Many UK customers have become accustomed to free banking. Free withdrawals and paying by card with no additional charge has become commonplace here. Consequently many assume that it will be the same when using their card abroad.

Michelle Slade of Moneyfacts.co.uk warns that “this is not the case, some lenders charge customers for both retail and cash transactions."

The majority of all banks add a currency charge for customers using their card outside of the country. This charge ranges from 2.75% to 2.99% every time you use your card either to withdraw money or pay for goods.

In addition, most banks add a separate charge for using your card abroad. Most have a minimum charge which means the less you withdraw at a time the harder you are hit by charges.

Ms Slade suggests "it may be worth planning ahead for your financial requirements for a few days at a time."

Unless, that is, you bank with Nationwide. They are the only bank currently not charging for overseas transactions.

“It is the only provider that does not make any additional charges for using your debit card abroad,” confirms Ms Slade.

"Its FlexAccount current account does not require any minimum funding in order to take advantage of this, so it may be worth opening an account with Nationwide just for using when you are abroad, if you don't want to switch your main current account."