CURRENCY CARDS - AN INTRODUCTION
There are lots of things that you need to do to prepare for a foreign holiday such as; booking the accommodation, getting travel insurance and purchasing your foreign currency.
But when it comes to arranging your foreign currency you must first decide what forms of travel money to take with you.
There are different ways of spending your money abroad such as, cash, credit cards, debit cards, or travellers cheques, and you should look closely at all the options before deciding what the best type of foreign currency is.
The Pros and Cons of traditional forms of foreign currency:
| Type of Currency | Advantages | Disadvantages |
|---|---|---|
| Credit Cards | Easy, flexible. Provides protection for expensive purchases and services. | Cash withdrawal fee and hefty interest rate charges. Foreign currency transaction fee, usually around 2%. Risk of fraud and danger of overspending. |
| Travellers Cheques | Secure, no fees. | Very low exchange rates therefore not good value for money. You need to show ID to spend. |
| Cash | Convenient. Good for small purchases. | Not very secure. Not replaceable unless covered by travel insurance. |
| Debit Cards | Familiar, easy to use. You can only spend what you have, so no danger of running into debt. | High charges and fees for exchanging to foreign currency. Transaction fee of around 2.75% and an additional fee for a point of sale transaction or for withdrawal from a cash machine. |
However now there is an alternative when deciding what kind of holiday money to take with you and that is currency cards.
Currency cards are a fairly new introduction into the travel money market and many people are now starting to use them as their main form of foreign currency when they travel abroad.
Basically a currency card, also called a travel money card, is like a foreign debit card that is ‘loaded’ with foreign currency.
When you apply for a currency card you can choose to have the currency either in Dollars, Euros or Pounds. Then you simply transfer money onto it from your bank account, either through the phone, bank branches, the internet or SMS text and the money is converted into the currency of your choice.
Currency cards can be issued as Visa, MasterCard or Maestro and you can use them in any country where you see these signs. You will receive a PIN number with your card and you can use it to withdraw cash from any overseas bank that displays the sign on your particular card.
There are many great advantages to these travel money cards and it is easy to see why they are becoming so popular.
However as with all things there are some slight disadvantages too and it is important to find out all the facts.
As there are a number of different providers offering pre-paid currency cards it is worth comparing the best ones to find the right one for you.
For more information please follow the links on the left to discover everything you need to know about the latest and best currency exchange cards on the market.