Using your existing debit card or credit card when you’re on holiday or business outside the UK can prove expensive due to the charges levied, but there is a cheaper alternative worth packing with your passport.
For example make a cash withdrawal with a TSB debit card abroad and you’ll be charged a 2.99% non sterling transaction charge plus a 1.50% (minimum £2) withdrawal fee.
That means a £200 withdrawal from a cash machine will set you back charges of £8.98.
If you use the card to make a purchase you’ll be charged the 2.99% non sterling levy plus a fixed charge of £1 per transaction.
Most debit and credit cards charge a 2.75% to 2.99% non-sterling mark up on all ATM and purchase transactions, plus you’ll pay up to an extra 5% for cash withdrawals with some credit cards such as MBNA.
Check with your bank to see what the charges are for your plastic as it may be worth taking a prepaid currency card instead.
A prepaid currency card is not a credit card, and you can only spend what you put on it, so there’s no chance of getting into debt problems, plus there are no credit checks when you apply.
With a prepaid currency card you apply for the card online and it normally takes between 7 and 10 working days before it lands on your doormat.
You can apply for a Euro card, a US Dollar card or a Sterling card – the latter allows you to use it in any country and multiple currencies.
With a Euro or Dollar card the exchange rate is locked in at the time you transfer the money from your debit card onto the prepaid card, so if the rate goes up or down afterwards it doesn’t make any difference to the rate you have on your card.
This is different to a debit card, credit card and sterling prepaid card where the exchange rate is the one available on the day and time you make each individual transaction.
Prepaid currency cards are all chip and pin secure and backed by MasterCard or Visa and so accepted in mullions of outlets all over the world.
Here are five of the most competitive prepaid currency cards:
- WeSwap – very competitive rates of exchange – swap currencies with other cardholders with fees from just 1% – no ATM fees on transactions over £200 – more details
- Sainsbury’s Bank Cash Passport – a multi-currency prepaid travel card with no ATM fees and a 24×7 Global Assistance service – more details
- FairFX – A choice of Euro, US Dollar or Everywhere multi-currency card. The multi-currency card charges 1.4% for purchases and 11.4% plus £1 for ATM withdrawals – more details.
- CaxtonFX – multi-currency card and mobile app with no annual fee and no charges on ATM withdrawals or purchases abroad – more details.
- Centtrip – £10 annual fee – a multi-currency card more suited to the frequent traveller and bigger spender. It costs 1% (min £1.60) per ATM withdrawal but you can switch between 15 currencies on a single card at a very competitive exchange rate – more details.