Using the wrong bank or travel card can lead to extra fees and charges when spending money abroad
Holidaymakers could end up spending more than necessary while travelling due to the use of inappropriate cards.Your everyday credit or debit card may seem like a convenient option for overseas use, but it could lead to additional charges of up to 5% when used abroad.
Moreover, withdrawing cash from an ATM while overseas could incur even more fees. Indeed, you might face extra charges as soon as you attempt to withdraw cash at the airport before your departure. Typically, foreign ATMs levy higher fees for international withdrawals, either as a flat rate ranging from £1 to £5 or up to 3% of the total withdrawal in some instances.
However, these fees can be avoided by selecting the right bank or travel card designed for overseas expenditure.
These specialist cards offer numerous benefits for those spending money abroad, including minimal to no spending or ATM withdrawal fees and additional financial protection.
Travel credit cards
One of the main advantages of a travel credit card is the Section 75 protection it offers, which obliges the card company to assist you if you make a purchase between £100 and £30,000 on it.
You can also enjoy interest-free spending on the card provided you pay off any outstanding debt in full each month.
One of the significant disadvantages of this card, however, is that it necessitates a comprehensive credit check, which means your eligibility for the card may be contingent on your credit history.
Travel debit cards
Travel debit cards pose fewer debt risks than their credit counterparts, but they also offer less financial protection.
Typically, travel debit cards provide chargeback protection, meaning if you don’t receive the goods or services you paid for and the retailer refuses to refund, you could still reclaim your money from the card company.
The market offers a broad spectrum of travel cards from various major banks and providers, each with its unique benefits and drawbacks. To find a card that fits your needs, it’s crucial to shop around and compare different cards.
MoneySavingExpert and Which? have highlighted some of the below cards for those looking to get the best deals while abroad:
It’s important to note that in some cases you may still face extra fees abroad even if you’re card provider itself doesn’t charge a fee since some ATMs will still charge a flat rate or interest for cash withdrawal.
There is also a smaller risk of damaging your credit score if you frequently take out cash while abroad with a credit card.
