Understanding Purchase Exchange Rate - Rate changes after purchase



I am trying to understand how the exchange rate works for purchases. I have just come back from a trip to the Republic of Ireland and compared Starling with my tried and tested Revolut Card.

My impress, and part of what sold me to Starling was the no fees, mastercard exchange rate, and notification showing local and sterling costs of transaction (plus same as in app) - this makes it great for travelling as I know if I spend money the app is live updated with my new balance - at least that is how Revolut works and I ‘thought’ Starling did.

However, with Starling, I made a purchase, it gave me the notification and in app details showing the GBP and Euro rates - perfect.

But… a couple of days later, when the transaction went from pending to completed I got a different exchange rate and the GBP was increased (ie a poorer exchange rate)

This to me points to it being that where Revolut gives you the exchange rate at the time of transaction, Starling actually only indicate the current exchange rate and actually process the transaction at the rate on the day of processing. Therefore is a transaction is made on Monday, the app gives Exchange Rate and details of X - but when the transaction completes, say Thursday, the transaction actually uses Thursdays rate which could be much worse.

This make is very difficult to budget when travelling, is the main reason I do not use my usual bank for this - I though Starling was more like Revolut in this ?

Small example I had: 23/04/2018 (Monday) purchase for 8 Euro where app told me £7. on the transaction (cannot remember the exchange rate). Two days later, £7.02 had been taken from my account for the 8 Euro purchase using a different exchange rate.

May only be 2p, but if I had not left money in the account this would have put me in the red - and several of these transaction per day would add up.

Can someone please clarify if what I am seeing is correct or if something went wrong - this affected 2 of 2 transactions I made


10 posts were merged into an existing topic: Foreign Exchange Rates