Travellers from around the globe are always drawn to examine new cultures and create lasting memories. However, travelling demands understanding foreign payment and currencies. Here is a guide to securing the right payment methods for international travel.
Payment Options
There are several ways to complete international payments. Here is a look at the top options:
Credit Cards:
A credit card allows users to withdraw money and transact on credit.
Pros
No transaction fees: Most credit cards don’t carry concealed costs, such as transaction fees. As a result, you can optimise your travel expenditure.
Benefits: Travel credit cards accrue benefits such as redeemable miles or points on bookings. You can use points to secure upgrades on flights or hotels.
Integrated insurance: Travel credit cards come with medical and travel insurance, allowing users to confidently tour international destinations.
Access: Some premium travel cards provide access to airport lounges and several premium airport facilities.
Cons
Annual charges: Credit cards have annual fees. Therefore, ensure the benefits and rewards outweigh the cost of holding the card.
Debit Cards:
Debit cards replace actual cash and use funds available in an account.
Pros
Widely accepted: Debit cards are accepted by retailers and ATMs worldwide. Almost every corner of the world has a card reader for debit card transactions.
No debt: Credit cards build debt, while debit cards access your money. A debit card is the way to go if you don’t want to owe anyone.
Cons
Charges: Although debit cards don’t have annual fees, transaction charges are applied to international transactions and withdrawals. The charges vary between banks.
Notification for travel: Some banks require notice of international transactions every time you travel. This ensures overseas transactions are not flagged and blocked.
Prepaid Travel Cards
Pros
Financial ease: Prepaid cards hold a set amount, allowing users to keep track of expenditures and stick to their travel budget.
Competitive exchange rates: Prepaid cards are known for providing unmatched exchange rates along with low transaction fees.
Cons
Reloading disadvantage: Reloading a prepaid card while travelling can be a headache. It’s prudent to load the card with enough money before travelling.
Money Transfer
Pros
Competitive exchange rates: Compared to conventional currency exchange bureaux, travel money transfer services provide attractive exchange rates. You get more value for your money.
Safe exchange: Money transfers are good for large payments, such as hotel reservations. They are reliable, safe and secure.
Cons
Transfer fees: The transfer fees may offset the advantage of a marginally better exchange rate.
Slow transaction speed: Processing money transfers may take some time. Therefore, plan ahead.
Wallets on the Go
Pros
Smooth payments: You can make safe, contactless payments with your smartphone or smartwatch and with mobile wallets.
Increased safety: Additional security features like fingerprint or face recognition are added to mobile wallets.
Cons
Limited global use: Although mobile wallets are growing in popularity, not everyone accepts them. Therefore, check ahead before pooling all your money into a mobile wallet for travel.
Now that you are aware of the payment options, consider the following further advice to maximise your overseas spending even more:
- Notify the bank of your trip arrangements to ensure unrestricted access.
- Account for the costs of ATM withdrawals, international transactions, and any other expenses related to your selected payment options.
- Take advantage of bonus points or low international transaction fees. These can go a long way in reducing your travel expenses.
- Reduce the frequency of ATM withdrawal fees if you are subject to high charges. You can carry cash, but be careful.
- If your travel destination has facilities for contactless payments, consider it. It’s practical and safe.
In conclusion, you can make well-informed decisions to reduce the cost of your overseas vacations by analysing the various payment options and related expenses. Choose right and pay less as you make your round-the-world flights.
