What’s the Best Way to Take Money Abroad?
Forget getting wads of cash out or sorting out a travellers cheque, these days cards can be the simplest, safest and most cost effective way to take and spend money abroad.
If you haven’t already got a bank account or credit card that offers zero fees on foreign transactions, the good news is that there are lots of prepaid travel cards and debit cards that won’t charge you a fee when you use them abroad – and applying for them won’t permanently affect your credit rating either.
What Is a Prepaid Travel Card?
When we think of prepaid cards, we can often think of those money cards that you’d add all your travel spends to before you go away. However, these days, prepaid travel cards have evolved so that you can top up on the go – often using an app on your phone.
They’re often a VISA or a Mastercard and so they’re accepted in most shops, restaurants and can be used to withdraw money from ATMs as well.
The Best Prepaid Travel Cards
Wise Travel Money Card
- VISA
- No fees for paying by card when abroad
- Allows exchange of 40+ currencies
- Uses interbank exchange rate plus 0.41% (see its cost calculator)
- Withdraw for free two times a month up to £200. If you go over that limit, you’ll pay 50p per transaction + 1.75%
- Use it instantly with Google Pay or Apple Pay – a physical card costs £7 or from £12 for express delivery.
- App and online access
Revolut
- Mastercard
- No fees for paying by card when abroad
- Standard (free) plan allows exchange of 30+ currencies with no fees Mon-Fri
- Uses interbank exchange rate plus 1% fee at the weekends
- Standard plan can withdraw a total of £200, or make a total of 5 ATM withdrawals (whatever comes first) for free a month
- Use it instantly with Google Pay or Apple Pay – physical card costs £4.99
- App only access – you cannot manage your account online
- Paid memberships offer bigger fee free allowances and additional perks
Pros and Cons of Prepaid Travel Cards
Pros
- Quick and easy to apply for
- Can be used instantly
- Mastercard and VISA widely accepted globally
- Often better exchange rate than getting cash thanks to using interbank exchange rate
- Top up on the go so less risk if lost or stolen
- Good for budgeting thanks to clear tracking of spends on the app
- App may have additional perks such as savings pots and spending summaries
Cons
- Not accepted for pre-authorisations such as car hire or hotel deposits
- Low fee-free withdrawal amounts on free plans
- Varying fees that sometimes change based on day
- Need to keep checking to make sure you don’t run out of money
- It’s not a bank so your money isn’t protected by FSCS, and as it’s not a credit card you won’t have added Section 75 protection. Instead, they have their own safeguarding policies – Revolut & Wise.
What Is the Difference Between a Prepaid Travel Card and a Normal Debit Card?
Prepaid travel cards aren’t linked to a bank account and so you’ll need to transfer money over or top it up – often from your bank account! Debit cards are those that are linked to your bank account.
So Can I Just Use My Bank Card From Home?
There are some traditional banks that do offer great rates on spending abroad – often on specialist credit cards – but in general, unless your bank or card provider states otherwise, you could end up getting charged for every single cost you charge to your bankcard whilst abroad so always err on the side of caution.
However, there are some great options available with free online banks that are quick and easy to apply to and that also offer fantastic rates on foreign transactions.
The Best Debit Cards for Travel
Monzo Bank
- No fees for paying by card when abroad – uses Mastercard’s exchange rate
- If Monzo is your main bank account you can make unlimited and free cash withdrawals abroad.
- Otherwise withdraw £250 for free in the EEA every 30 days (free if you use Monzo as your main account or have Monzo Plus or Premium)
- Withdraw £200 for free outside of the EEA every 30 days (bigger limits if you have Monzo Plus or Premium), if you exceed that limit you’ll be charged 3%.
- Use it instantly with Google Pay or Apple Pay
- Free delivery of a physical card
- Runs a ‘soft check’ which won’t leave a permanent mark on credit report if not accepted
- App and online access
Starling Bank
- No fees for paying by card when abroad – uses Mastercard’s exchange rate
- Withdraw cash abroad anywhere, with no fees – the only limit is six withdrawals a day with a daily limit of £300
- Use it instantly with Google Pay or Apple Pay
- Free delivery of physical card
- Runs a ‘soft check’ which won’t leave a permanent mark on credit report if not accepted
- App and online access
Chase
- No fees for paying by card when abroad – uses Mastercard’s exchange rate
- Withdraw £500 a day abroad for free, with a limit of £1500 a month
- 1% cashback for 12 months
- Use it instantly with Google Pay or Apple Pay
- Free delivery of physical card
- Runs a ‘soft check’ which won’t leave a permanent mark on credit report if not accepted
- App only bank – you’ll need an Apple device running iOS 14.1 or later
Pros and Cons of Travel Debit Cards
Pros
- Quick and easy to apply for
- Can be used instantly
- Mastercard widely accepted globally
- Often better exchange rate than getting cash thanks to using Mastercard’s exchange rate
- No need to keep topping up your balance
- Good for budgeting thanks to clear tracking of spends on the app
- App may have additional perks such as savings pots and spending summaries
- As it’s a registered bank, your money will be protected by FSCS
Cons
- If you’re using a debit card, it’s unlikely that it will be accepted for pre-authorisations such as car hire or hotel deposits
- Some have low limits on free withdrawals
- You may not be accepted after the bank has run a soft check on you, though it won’t leave permanent mark on your credit score
- More risk if lost or stolen as it’s linked to your bank account
- If paying with debit, you won’t have the added Section 75 protection that comes when paying with credit – though you may be able to use Mastercard chargeback
My Top Tips for Avoiding Fees When Spending Abroad
Pay in the local currency
ATMs or card machines might ask you whether you would like to complete the transaction 'with conversion' or 'without conversion'. You should always choose 'without conversion' - or whatever option is in the local currency. This is because when you do this, the rate is decided by the card you're using - so in the options above the rate would come from either the interbank or the Mastercard exchange rate. If you were to accept 'with conversion' the ATM provider or merchant can apply their own exchange rate which is likely to be less favourable!
ATMs may still have fees
Some cash machines will still charge you a fee even though the bank/card will not charge you. It should show you the cost before you complete and confirm the withdrawal. My tip is to google nearby banks and use their ATMs though sometimes they charge too!
Going on holiday next week?
Set up an account now, it doesn't take long but if you want a physical card it can take a few days for this to be posted out.
Keep a track of your spends with notifications
As soon as you've made a purchase, you'll usually be able to see the amount you've spent (and sometimes the conversion to GBP). It's particularly helpful if you're trying to stick to a budget.
