Holidaymakers could be unknowingly spending more than necessary while on their travels, simply by using the wrong card.
Your everyday credit or debit card may seem like a convenient option to take abroad, but you could end up being charged an additional 5% when used overseas. Moreover, if you need to withdraw cash from an ATM while abroad, you could be hit with even more charges.
Indeed, you could face extra fees as soon as you reach the airport and attempt to withdraw cash before your flight. Typically, ATMs abroad impose higher fees for international withdrawals, either a flat rate ranging from £1 to £5 or up to 3% of the total withdrawal in some instances.
Luckily, these fees can be avoided by selecting the right bank or travel card designed for overseas expenditure. These specialist cards offer a host of benefits for those spending money abroad, including minimal to no spending or ATM withdrawal fees, along with additional financial protection.
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 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.
