What Are The Advantages Of Travel Money Cards?
There are plenty of people living in the United Kingdom that have delayed trips to the U.S or Europe because of the awful currency exchange rates; however, you can solve this situation by using travel money cards, which are not extensively know but provide an appealing choice.
How do travel money cards work?
A new entry into the plastic money family, travel money cards let you load up a card at a known exchange rate, which you can spend at your leisure when you arrive at your destination.
You can apply for these cards through online providers, then upload currency anytime you want on the internet, or by phone, or possibly via SMS services. At the moment the cards are available with simply these currencies: dollar, euro, and pound.
So what are the benefits of using this card?
Importantly, the rate of exchange is usually higher than you’ll find in a typical foreign currency exchange office. Also, the exchange rate is unchangeable at the time you upload money to the card — so when you spend while travelling, you already know what it’s costing you. This is wildly different than credit and debit cards, which use an exchange rate that’s dynamic — whatever the going rate is at the moment you use the card.
Is there more?
No, not really. These cards, unlike regular debit and credit cards, don’t have a foreign currency exchange rate costs, which can be an additional 2.75%, that some providers will add on to the basic exchange rate!
If you didn’t know, debit and credit cards might also elicit an additional “till charge” when used in restaurants or shops, but the currency exchange card doesn’t have this charge. Be aware that debit and credit cards have high rates for any cash withdrawals, but the cash on the currency card have been prepaid, not borrowed, so it’s not applicable.
That is great news! Now, what are the possible drawbacks?
Since you are uploading funds onto the card in advance to your trip, your vacation is paid for up front, not with credit, so you must save for your trip. But, that may not be a disadvantage in the current economy. Currency cards do have fees for taking cash from ATMs, but the associated fees are much less that those incurred with credit or debit cards.
One example of this is that, when this article was written, NatWest and RBS both had a withdrawal fee of two percent, which amounts to about 6 each time you withdraw the sum of 300. Currency exchange cards, however, have a one off fee that amounts to as little as 1.50 no matter how much your ATM withdrawal is.
The real downfall for you is the charge you’re charged for using your card to pay for something in a currency other than one issued – and FX convert fee; using the example of a dollar transaction which is made with a euro currency card, you could be charged a fee of up to 2.75%. However, there are a number of cards that don’t charge this fee (see list below).
What about credit cards that can be used without FX costs?
Traditional credit cards like Post Office, Nationwide Gold, and Abbey Zero fit into this category. The first two cards, though, have 2.5% withdrawal fees for cash with a minimum charge of 3 per transaction, even though they don’t carry FX costs. This isn’t better than a travel money card, unless you don’t have the cash upfront for your travels.
The Abbey card is an excellent best-buy – no cash withdrawal fees or foreign exchange, however there is a rather high interest rate of 25.9% on cash withdrawals! (Note: currently the rate is 22.9% for Nationwide and 20.83% for the Post Office).
That’s me, convinced — tell me more. Who has the best deal on travel money cards?
FairFX Euro Currency is simply the top card on the market currently, with exceptionally good exchange rates, a 0% fee for the exchange rate conversion, and a very low ATM cost (1.50). You’ll also find a low ATM fee (1.95) with the Indigo Travelcard Euro, but it has a high conversion cost of 2.75%. For no conversion fee, there’s the ICE Travelers CashCard Euro… but it has a higher ATM fee (4).
When it comes to dollar cards, FairFX positions at the top again: its Dollar Currency Card gives you a low $2 ATM fee with no charges for converting. Another excellent deal is ICE Travellers CashCard Dollar with its’ $3 ATM fee and again, no convert cost. Don’t forget no convert fees gives you the option of using these cards in any country.
What’s the best travel money card for world travel?
FairFX have just launched what they call an ‘Anywhere Card’ which at the moment of writing appears to be the best value of all the travel money cards for worldwide use.
The are no ATM charges with the FairFX Anywhere Card, and no loading fees either! A 1.5% transaction charge is the only fee that applies so it certainly appears to be the cheapest global travel money card on the market.
Currently, FairFX is giving a free dollar, euro or sterling ‘Anywhere Travel Card’, which usually costs 9.95, for a very small initial load. Why are you dragging your heels? Save money by getting a travel money card from FairFX travel money exchange today!
