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Travel industry news

14 Jun 2019

BY James Chapple

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Ryanair under fire over 'rip-off' fares inflated by currency conversion

Which? has renewed its call for the CAA to investigate Ryanair’s use of dynamic currency conversion when selling flights, claiming the practice is inflating air fares by up to 6%.

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Ryanair under fire over 'rip-off' fares inflated by currency conversion

Ryanair displays the price of its tickets in the currency local to customers’ departure airport, meaning flights from France, Italy or Spain are advertised in euros rather than sterling.


However, Which? says when customers enter their card details at the end of the booking process, the price switches to pounds and automatically applies an exchange rate, found by Which? to often be unfavourable against market rates.


The option to pay instead in local currency rather than pounds – typically cheaper – is obscured in a “more information” link, with Ryanair warning opting out of the exchange could result in the fare costing “significantly more”, said Which?.


However, a Which? spot check of fares found a journey from Alicante to Stansted for a family of four advertised at €565.81, which became £526.97 at checkout - an exchange rate of 93p per euro.


The same day, Which? found Visa offering an exchange rate of 88p per euro meaning if the customer had opted out, they would have paid £496.72, £30 less than with Ryanair’s exchange rate.


The watchdog found other examples, including a Venice-Stansted fare inflated £26.40 and a Nice-Stansted flight coming in £21 more expensive.


Which? said across all the journeys it examined, Ryanair’s own exchange rate inflated fares by around 6% on average.


Aer Lingus was the only other major carrier found by Which? to be employing a similar practice, although it made the practice and cost implications more clear, with average inflation of fares through dynamic currency conversion at around 3.5%.


Which? has previously reported the practice to the CAA as a breach of consumer protection legislation.


It has called on the CAA to single out Ryanair’s dynamic currency conversion practice in its upcoming report on the true price of travel, due to be published later this month.


Caroline Normand, Which? director of advocacy, said: “This cynical and misleading pricing trick is one of the clearest examples of a rip-off we have seen, but Ryanair has been allowed to get away with it due to a lack of action from the Civil Aviation Authority.


“If the regulator is committed to helping improve the experience of passengers, it must clamp down on this practice before thousands more holidaymakers are caught out this summer.”


A Ryanair spokesperson said: “Ryanair’s currency conversion presentation is fully transparent and complies with all applicable EU and national laws on consumer protection.


“Customers have the option of paying in the currency of their payment card which gives absolute certainty of the final payment amount.”

 

TTG has approached the CAA for comment.


Which? advises passengers pay in local currency when booking flights back to the UK and have their card provider or bank handle the conversion, typically at a more favourable rate.

What’s your view? Email feedback@ttgmedia.com and let us know your thoughts or leave a comment below.

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