Britons are losing out on up to a tenth of their holiday spending cash by purchasing currency at the airport, it has been claimed.

FairFX CEO Ian Strafford-Taylor said the rates offered by currency providers at airports are often eight to ten per cent lower than those available online.

Worse, many customers exchange any unspent currency back to pounds at the airport, meaning a double-whammy of poor rates.

Mr Strafford-Taylor discusses the other major mistakes customers make and looks at the threat banks could pose to the forex specialists.

Q. Are consumers becoming more knowledgeable when it comes to buying cheaper currency?

Yes, but there is still a lot of work to do to make people aware they do not have to go to their bank, the post office or the airport.

Just like people shop around for cheap flights, so they should for currency.

The trouble with forex is that it is not as straightforward as comparing, say, different loaves of bread. The price is always moving, you have work out percentages ... sometimes people just glaze over.

So it is taking longer than we would like, but we are definitely starting to see a change in consumer behaviour.

For instance, whenever the pound is doing well we see an uptick of customers buying other currencies. Even though they aren't going on holiday yet, they are acting in advance to get a good deal.

Q. What about the most costly mistakes consumers make?

Buying at the airport, where the rates are far less competitive, is the most obvious one. You lose up to 8%-10% at some airports. It is huge money - and if you do not spend all your cash, you will get charged the same again to change it back!

Next is the dynamic currency conversion trap. When you are abroad and a shop gives you the option to pay in pounds rather than the local currency - say no! They end up offering you a really rotten conversion rate and you will be far worse off.

Finally, avoid carrying around loads of cash for obvious security reasons.

Q. What are the main threats you face as a company?

Clearly there is a concern that banks will want to slash their spreads and compete with us.

I often get people asking me "what happens if the banks view you as a big enough threat and focus their considerable weight on challenging you head on?"

I am not particularly worried about that. Our main selling point is that we are cheaper than them. We have a completely different business model, it is kind of like easyJet versus BA.

But it's obviously something to be aware of - as is the threat from newcomers. You have to look both ways.

I would definitely say the big challenge we face is finding the balance between being big enough that people know and recognise us, but being nimble enough to innovate as quickly as possible, to keep up in a rapidly changing sector.

Q. And what about the biggest opportunities?

There is enormous opportunity for growth in the currency space. If you just look at the UK travel money industry, you are talking about £30 billion a year.

Add in what people and companies transfer and it is billions of pounds a day.

Forex sounds dull, but what it enables people to do is not dull.

Q. What future trends should we look out for? Where is the growth potential?

We sell currency online - and that is growing - but we made the decision to really focus on the prepaid travel card. We felt that space is there to be owned.

In the future it will all be about an app on your phone, making payments with wearable technology ...

That technology already exists of course, but only in certain areas. It takes time for the world's merchants to catch up.