Cheap cards to use abroad

Cards can be the cheapest way to pay for things and get cash from machines abroad but only if you use the right one. Your usual card might have expensive overseas fees, so you could save a lot by getting a special ‘travel-friendly’ credit, debit or prepaid card before you go.

Overseas card fees and charges – what you might pay

It pays to check

Check the cost of using your credit or debit card overseas. Some cards are designed for travellers – others could give you a nasty surprise.

Your card provider can hit you with four main types of fee when you go abroad.

  • Foreign usage fee. When you spend money abroad by card, at the end of the day the amount you have spent is converted from the local currency to pounds using the day’s exchange rate. Your transactions are pooled with those of many other customers. By buying and selling currency in bulk, the card provider can typically get a good exchange rate. However, most standard credit or debit cards make this slightly worse for you by adding a ‘load’ of up to 3% (so £100 overseas would cost you £103).
  • Cash withdrawal fees. Most debit cards charge you for using a cash machine overseas. They’ll typically deduct 2.75%-3% of what you take out. So £100 cash would cost you £103, or £106 if you consider the foreign usage fee too.
  • Credit card interest. Usually with a credit card, you only pay interest if you don’t pay off the bill in full at the end of the month – but when you spend overseas some cards will always charge you interest. Don’t withdraw cash using your credit card. You will be charged interest straight away, on top of all the other fees.
  • Flat fees. On top of all the rest, some cards charge a fee of around £2 every single time you use them.

Imagine using a credit card to take out £100 at the cash machine. With the worst kind of card you might pay:

  • £3 extra for the exchange rate load
  • £3 for the cash withdrawal fee
  • £1 interest before you pay off your bill
  • £2 in flat fees just for using the card

… a total of £9 in fees, just for getting out a little cash.

And remember, you get hit with these charges every time you use your card.

With the best kind of card you’d barely pay anything – some don’t even apply a ‘load’.

How to choose the best card for your trip

There are lots of cards to choose from, but there’s no need to go through the details – that’s all been done for you.

Several comparison sites cover cards for use overseas, and you can get expert recommendations from Which?, MoneySavingExpert.com and Moneysupermarket.com.

Stay safe when using your card overseas

Before you leave

  • Only take cards you plan to use. Leave the others in a safe place at home.
  • Note down the emergency phone number for your cards – it’ll be on the back of the card. Keep the numbers separate from your cards, in case they get lost or stolen. It’s better to write down the +44 number than an 08** number, as the second type may not work from abroad.
  • Tell your card provider or bank where you’re going and give them your contact details (including a mobile number), or they might think your overseas purchases are fraudulent and cancel your card. It may be worth taking another card from a different bank, if you have one, so you’re not stuck for cash if your main card is blocked.
  • If your cards are registered with a card protection agency ensure you have their phone number and your policy number with you.

Once you’re abroad

Top tip

If you pay by card, pay in the local currency. Don’t let the retailer charge you in pounds – you could end up with a poor exchange rate.

  • Keep your eyes on your card. Never let it out of your sight when you pay, especially in bars and restaurants.
  • Never give your PIN to anyone else – even if they claim to be from the police or your bank.
  • Always shield your PIN when using a keypad or cash machine, just as you would at home.

Avoid extra charges

  • Only use your debit card if it has low international usage fees. If your card charges a fee each time you use it abroad, use cash or your credit card or prepaid card instead.
  • Withdraw lots of cash at once. If you do it in bits you’ll have to pay lots of fees instead of just one (unless you have a card with no transaction fee for cash withdrawals abroad). Take out enough for several days, carry what you need and leave the rest securely where you’re staying.
  • Choose to pay in the local currency if you’re given the option of that or pounds. It’ll probably cost you less, since most retailers won’t give you a great exchange rate.

When you get home

  • Check your statements. If you find any transactions you don’t recognise, let your card provider know right away.
  • Pay off your credit card bills in full on the repayment date – don’t bring debts back from holiday.