After the pandemic and months-long travel-restriction world has started to coming back to normal. You can now travel to many countries without having to quarantine on return. Travel industry started to booming again. Therefore, you should start planning your next holiday well in advance. Finding a perfect travel credit card is one of the most important parts of your holiday plan. A travel credit card with no or fewer fees and interest will make your holiday more affordable.
A travel credit card is the best way to pay for your expenses at your desired holiday destination. However, when choosing the travel credit card you have to be really careful, make sure you compare the charges and fees charged by your card provider with other card providers in the market. Travel credit card is a specialised credit card that works the same as a standard credit card but they charge very little fees or no fees for using them abroad.
Benefits of using travel credit card
• No hassle of carrying cash.
• Unlike standard credit or debit card travel credit card offers No fees or low fees foreign currency transactions.
• No or low ATM cash withdrawal fees and low-interest rate.
• If there is any issue on purchases over £100, you are protected by section 75 of the consumer credit act. You are eligible to claim compensation from the card issuer or Marchant.
• You can pay in local currency to avoid the terrible conversion rate.
• Most of the card offers cashback rewards on total spending.
• Some credit card offers points convertible into cash or with the opportunity to use points to purchase from specific retailers or airlines.
• Most of the travel credit card offers very competitive exchange rate.
• You are protected against any kind of identity theft in case your card details are stolen you can cancel your card immediately.
Things to keep in mind when choosing a travel credit card
• Check for the transaction fees charged by the credit card provider. Do good research and choose the card with the lowest transaction fees or no transaction fees.
• Most of the card providers charge fees for withdrawing cash from ATM abroad. The fees are normally charged as a percentage of the total amount withdrawn. Always do a comparison of the fees charged by the credit card providers. There are some cards that offer free cash withdrawal abroad.
• The exchange rate is a very important factor when choosing a travel credit card. You can save a lot using a credit card with a better exchange rate.
• Most of the credit card providers charge interest on the cash you withdraw from ATM and interest changing period starts from the time money were withdrawn. Card with the lowest interest will help you to save on your holiday expenses.
• Check if the credit card you choose is acceptable at most of the places of your holiday destination.
• Some cards provide interest-free shopping for a specific period of time up to a certain amount as an introductory offer. Have that in mind when choosing your credit card.
• If you want to keep your spending within some limit you might consider prepaid travel card instead of a travel credit card.
• Some travel credit cards charge monthly or annual fees, therefore have a look for monthly or annual charge carefully.
• Look for the company provides better rewards on your spending.
Most popular Travel credit cards to use abroad
Barclay reward card does not charge any fee for ATM cash withdrawal abroad as long as you withdraw in local currency and pay off the balance every month.
Representative APR is 22.9%.
Does not charge any transaction fees if you pay in a local currency, also offers 0.25% cashback on all your spending with that card.
Halifax Clarity Mastercard
Does not charge any transaction fees for spending abroad. Free to use anywhere of the world.
No charge for international cash withdrawal, however, charge interest on any amount from the date withdrawn.
Representative APR 19.9%.
No fees for any international transaction or cash withdrawal in anywhere in the world.
Charge interest on cash withdrawal from the date withdrawn.
Does not charge any interest for any foreign currency purchase up to 12 months.
Representative APR 18.9%.
Also offers up to 15% cashback with the selected retailers through retailer offers the programme.
Metro bank credit card
No transaction fee for foreign currency purchase in Europe.
Does not charge for cash withdrawal abroad, however, charge interest on the total amount withdrawn from the date withdrawal has made.
Representative APR 14.9%
118 118 Money
Popular card for the people with a poor credit score.
No foreign currency transaction fees and no overseas cash withdrawal fees.
No interest in ATM cash withdrawal as long as you pay off the full amount monthly.
Representative APR 34%
No ATM cash withdrawal fees abroad, and no foreign currency transaction fees abroad.
Charge interest on cash withdrawn abroad at the rate of 24.9%
Representative APR 24.9%
Natwest credit card
Charge 3% fees on Atm cash withdrawal, and charge interest at the rate of 16.9% to 25.9%.
Representative APR- 9.9%
Post office credit card
Charge 3% fees on ATM cash withdrawal abroad ( minimum fees £3).
The interest rate on cash withdrawal is 24.93%
Representative APR 24.9%
Creation everyday MasterCard
Fee-free cash withdrawals and foreign currency transaction worldwide.
Charge interest on any cash withdrawn from the date withdrawal has made until repay in full.
Offer lowest Representative APR – 12.9%
4 IMPORTANT THINGS TO KEEP IN MIND WHEN USE TRAVEL CREDIT CARD
• To secure the best exchange rate always spend in local currency
• Avoid cash withdrawals, cash withdrawal is free however card issuer charge interest on the amount withdrawn from the time the withdrawal has made.
• Try your best to avoid borrowing unless you have the interest free purchase for a certain period of time.
• Make your outstanding monthly payment on time and pay off full outstanding amount as soon as possible to avoid racking up interest.
Most Popular debit card to use abroad
To choose the best debit card to use overseas you need to find out the rate of three different kinds of fees charged by your card issuer, the non-sterling purchase fee, non-sterling transaction fee and non-sterling cash withdrawal fee. The following comparison of some of the widely used debit card abroad will help you to choose your card.
Starling Bank (App Based)
No fees on foreign currency transaction and foreign currency cash withdrawal anywhere in the world.
AER – 0.05% In-credit interest rate.
No exchange fee.
Does not charge any fees on foreign currency transaction and cash withdrawal anywhere in the world.
AER – 2.02% in-credit interest rate, Variable up to £1000.
Cuurensea (links to your existing bank account)
No fees for foreign currency purchase payment and ATM cash withdrawal worldwide.
Exchange rate a bit worse than above two as it adds 0.05% mark up on interbank exchange rate.
ATM cash withdrawal limit is £300 per day and £500 per month.
Monzo (App Based)
Fee-free foreign currency transaction and ATM cash withdrawal in the EU.
For elsewhere in the world cash withdrawal limit is £200 per month, 3% fees on withdrawal over £200.
Cash withdrawal and foreign currency transactions are free of charge, however, the cash withdrawal limit is up to £200 per month anywhere in the world. Charge fee 0f 2% on any withdrawal over £200.
Offers better exchange rate.
Offers fee-free cash withdrawal and foreign currency transaction abroad.
Charges fee of £13 every month.
Popular Prepaid card to use abroad
Prepaid foreign currency card is one of the popular ways apart from some credit and debit cards to spend overseas. There are a number of cards to choose from with various fees and interest rates. You must do a comparative analysis to decide the best card for you. The following comparison will give an idea which one is the best card for you.
Caxton Fx Currency Card
No overseas cash withdrawal or transaction fees.
Available in 15 currencies.
Minimum load – £50 or £100, if done via mobile phone.
Redemption fee- £1.50
No ATM cash withdrawal fee up to £200 per month, 2% fees applies for withdrawal over £200
Available currency- 40
Conversion fee- 0.35% to 1%
Redemption fee – 65p
Travelex Money Card
No cash withdrawal fee and no purchase fee in preloaded currency.
Available currency – 10
Conversion fee- 5.75%
Inactivity fee – £2 per month (if not used for 12 months)
Easyjet Euro Currency Card
Free cash withdrawal and purchase overseas.
The card is free if you load over £100 otherwise incur a charge of £5.95
Only available in Euro.
60 Euro is the minimum amount you can load.
Account closing fee £10
WeSwap Currency Card
It charges a fee of £1.50 for withdrawal less than £200.
Available currency- 20
Instant conversion rate 2%, conversion before 7 days 1% and before 3 days 1.3%
Charges a refund fee of £5
BA Executive Club/ Avios Multi-currency Cash Passport
Charges a fee of £1.50 for ATM cash withdrawal.
Available currency – 10
Earn 1 Avios point for every pound you own.
Minimum load is £50
Redemption fee – £6
Inactivity fees £2 per month if not used for 12 months.
Virgin Money Travel Money MasterCard
Purchase is free in the specified currency,
Cash withdrawal fee is $2
Can load either in US dollar or Euro.
Minimum load – $100
No inactivity fee
The redemption fee is $10