The Safest Way To Spend Money Abroad Without Additional Charges
As tangible money increasingly becomes a thing of the past and is replaced by debit cards, online banking and digital currency, managing your finances abroad is becoming more and more difficult.
You only really have two options when it comes to spending on your holiday: limit yourself to the cash you get from your account before you leave, or use your card and incur the fees. Neither are particularly ideal. The first means that, most of the time, you have too little and have to dip into your bank account or too much and have to exchange it when you return – not to mention it’s easier to lose. The second ensures you face hefty international charges on almost everything you buy. However, a third option is beginning to increase in popularity and may provide a viable alternative.
Foreign Exchange Cards, sometimes shortened to FX carda and sometimes known as prepaid currency cards, are slowly becoming more common in the United Kingdom (Mastercard suggests there will be a 25 per cent rise in their usage by 2017). The concept of them is very simple. You transfer however much money you think you might need to the card, which is completely separate from your bank account, in pound sterling. Users then have the ability to convert this into whatever currency they need at the current exchange rate. You then use this card at any of the 34 million Visa or MasterCard approved outlets when you are abroad.
What’s the difference?
So what is the difference from a normal debit card? There’s a few crucial things. First of all, as it’s not linked to your bank account, it is a lot safer to use the Foreign Exchange Card when you are abroad as opposed to your normal credit or debit card. If lost or stolen, you do not have to worry about those who have acquired it accessing your finances. But secondly, and more importantly, the conversion of currency before you even leave the country means you no longer have to pay those high additional charges every time you use your card abroad. A Foreign Exchange Card is just like using a native credit or debit card to the country you are in.
It’s easy to apply for one of these FX cards. There is no need for a credit check and it can all be done online. Although the most popular suppliers at the moment are banks such as HSBC and NatWest. There is next day delivery available so you can get your hands on one even if a holiday is just around the corner.
Helen Child has an excellent guide to Foreign Exchange Cards if you require some more information.