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One of the cheapest ways to spend abroad
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Going abroad or spending on foreign websites? Get a specialist travel credit card for near-perfect exchange rates worldwide. This guide includes best-buy cards, the cards to avoid, and how to check what your card's charging you when you use it overseas.
Cheap travel money alternatives
Not sure which method's right for you? See our Cheap Travel Money Tips
How do travel credit cards work?
Specialist travel cards are so good for spending abroad because they don't charge fees. Use your everyday plastic while on holiday and you could be hit by a host of hidden charges (for full details, read the hidden holiday spending charges note). These include adding a non-sterling transaction fee of around 3%, cash withdrawal fees and interest charges even if you pay off in full (on credit cards).
But there are credit and debit cards that don't charge these fees, making them ideal to use when you're on holiday or buying from overseas websites. Use this checker to find out what you'll pay when using your existing card and check out our best buy cards below to find cards that don't charge.
How much does your card charge? Find how much you pay to use your card abroad
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| Exchange Load | ATM Charge | Spending Charge | Cash Withdrawal Interest |
|---|---|---|---|
| (min £) |
If you think any cards should be added to the tool, please email us.
Use our eligibility calculator to find cards you're most likely to get, without hitting your credit score
Making an application is recorded on your credit file. While a single one is not a big problem, especially if you've a good credit score, lots in a short time are problematic.
So use our Travel Credit Card Eligibility Calculator to show cards you're most likely to get, so you don't waste an application. And it's NOT recorded as a hard search on your credit file.
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You can save £100s per holiday using a specialist card
When abroad you want to pay for only what you buy, yet using any bog-standard card means you're paying to pay, too. Here's how much spending €1,000 actually cost, in pounds, when we made comparisons on 9 July 2018 using our Travel Money Comparison tool (we assumed five €100 cash withdrawals and 20 transactions on the cards).
- On a specialist credit card repaid in full: £889.83 (see cheapest credit cards)
- Cash, via UK's cheapest bureau (pick up in London): £892.78
- Cash from M&S (non-cardholder): £915.83
- Using a debit card from hell: £946.25 (see debit cards from hell)
- Change at airport (Gatwick South Terminal, ICE Travel Money, not pre-ordered): £1,046.46
As you can see, the differences can be massive, yet the winners are simple. Apply for a specialist overseas credit card, then use it every time you go.
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If you're using a credit card, ALWAYS pay it off IN FULL every month
Specialist overseas credit cards can be the best way to spend when you're on holiday, but can turn into one of the worst ways if you're not disciplined enough to pay them off. Always follow the golden rule:
"Set up a direct debit to repay in full every month, or the interest charges dwarf the cheap-currency gains."
Direct debits may be marked 'inactive' if a card hasn't been used in a 13 month period – so if your hols have more than a year between them, check the direct debit is still in place.
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If they ask 'want to pay in pounds or euros?', say 'euros'
Many overseas hotels, shops and ATMs ask this when you pay by card. If you choose pounds, the retailer does the currency conversion – but rates can often be poor compared with letting your card do it (choosing euros) - see Martin's euro analysis.
If you've got a top overseas card, always choose the local currency, as your card does the exchange and it's unbeatable.
If you're using a bog-standard credit or debit card, it's touch and go. Sometimes the card machine will show you the 'non-sterling cash fee'. If this is under 2.5%, go with pounds. If it's over, pick the local currency.
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First use our eligibility calculator to find cards you're most likely to get – and protect your credit score
Usually, the only way to know if you'll be accepted is to apply, but each application marks your credit file. But our Travel Credit Cards Eligibility Calculator quickly shows your odds of getting almost every top travel credit card so you can find the ones most likely to accept you, thus minimising applications.
How does the eligibility calculator work?
It uses a 'soft search', which is one you will see on your credit file but lenders usually don't (and where they do they can't use the info), to give us an indication of your credit score. We then match this against lenders' criteria for acceptance so we can show you the odds of getting each card.
Once you have this knowledge, it will allow you to make a smarter application. Therefore, you're less likely to be rejected and less likely to need to apply elsewhere, which would add another mark on your credit file.
Or join our Credit Club for a full credit health check
The MSE Credit Club is a game-changer. For years the credit market has been shrouded in mystery but our revolutionary tool brings together the key components to give you the full picture, and crucially, what it means for your acceptance chances and how to boost your creditworthiness. A credit score alone isn't enough to borrow, as there are other factors at play (it's why many with perfect scores still get rejected). Credit Club shows your Free Experian Credit Report and Credit Score, your Affordability Score, you Credit Hit Rate and much more.
Beware your debit card – it could be the worst way to spend
Let's make this plain – do not use the following cards for spending overseas. Any of the methods in this guide beat them. Nine debit cards have nightmarish charges every time you use them overseas. With most debit cards, you pay a non-sterling transaction fee for spending, typically around 3% of the transaction, and a charge if you withdraw cash abroad.
But these cards have another sneaky charge: a spending fee of £1-£1.50 each time you use your card. Imagine you buy something for £5 in a shop. With the worst of these cards, it can end up costing £6.60 with the fee and charges.
The cards from hell
Santander Debit Card
Spending penalty: £1.25 | Load fee: 2.75% | Cash withdrawal: 1.5% (min £1.99)
TSB Debit Card
Spending penalty: £1 | Load fee: 2.99% | Cash withdrawal: 1.5% (min £2 max £4.50)
Bank of Scotland Debit Card
Spending penalty: £0.50 | Load fee: 2.99% | Cash withdrawal fee: 1.5% (min £1.50 max £4.50)
Lloyds Debit Card
Spending penalty: £0.50 | Load fee: 2.99% | Cash withdrawal fee: £1.50
Halifax Debit Card
Spending penalty: £0.50 | Load fee: 2.99% | Cash withdrawal fee: £1.50
IF Debit Card (existing custs only)
Spending penalty: £1.50 | Load fee: 2.25% | Cash withdrawal fee: £1.50
The cards below don't have a specific spending penalty, but instead charge a minimum exchange fee, meaning these are hell for small spends. Without this, a £5 spend on these cards would cost £5.14, but this minimum exchange fee bumps it up to £6 or £6.50...
Clydesdale/Yorkshire Debit Card
Spending penalty: none | Load fee: 2.75% (min £1.50) | Cash withdrawal: 3.75% (min £1.50)
RBS Debit Card (no spending fees until Fri 31 Aug)
Spending penalty: none | Load fee: 2.75% (min £1) | Cash withdrawal: 2% (min £2 max £5)
NatWest Debit Card (no spending fees until Fri 31 Aug)
Spending penalty: none | Load fee: 2.75% (min £1) | Cash withdrawal: 2% (min £2 max £5)
Full list of charges for major UK credit and debit cards.
Is spending or withdrawing cash cheaper when I'm on holiday?
If you've a top overseas credit card, spending is always cheaper. Even on cards with no cash withdrawal fees, you'll usually still pay interest on the withdrawal until you pay it off (the Barclaycard below is the rare exception to this).
This goes double for non-specialist credit cards. You'll pay the non-sterling transaction fee on all transactions overseas, but you'll also pay a fee and interest on cash withdrawals.
On debit cards, spending is still cheaper as while there's no interest on a cash withdrawal, there's usually still a fee (as well as the non-sterling transaction fee) when you use a cash machine.
Not all cards are equal – check if the card you're applying for has the Mastercard, Visa or Amex logo
When you spend abroad, your bank gets an almost perfect rate when it does the exchange for you. It exchanges at Mastercard's, Visa's or Amex's wholesale rate, all of which are pretty close to the spot rate that the currency markets suggest (the perfect rate) – though Mastercard's rates tend to be slightly better.
However, most banks then charge you for having them make the exchange for you, and this is where the up-to-3% non-sterling exchange fee comes in.
But some banks and credit card providers waive these fees. They give you the near-perfect rate without any non-sterling transaction fee. It's these cards that are in this guide, as they allow you to spend the right way overseas.
Looking to 'lock-in' a rate? Consider a prepaid card instead
With travel credit (or debit) cards, you get the rate when you spend or withdraw on the card. While there's nothing inherently wrong with this, if you're worried about currency swings a Prepaid Travel Card might be a better option.
Some prepaid cards allow you to lock-in a rate ahead of time for certain currencies - so you can effectively convert your sterling into euros/dollars before you head away. While there's no way of knowing if buying currency in advance will work out cheaper than getting the rate on the day, it may give you peace of mind.
Top travel credit cards
These specialist cards have near-perfect spending rates but tend to charge fees or interest on cash withdrawals. We've picked out the top credit cards that allow you to spend for free overseas here.
Good if you regularly withdraw cash
Barclaycard Platinum Travel Credit Card
The Barclaycard Platinum travel card has no fees on spending or cash withdrawals overseas till August 2022, giving a decent amount of certainty.
And if you pay off your balance in full each month, you won't be charged interest on overseas cash you withdraw, unlike other cards in the guide, which charge daily interest on cash until it's paid off. However, this card uses the Visa exchange rate, which is typically worse than the Mastercard rate used by the majority of cards in this guide.
Need-to-knows
- You can't get this card if you're an existing Barclaycard customer or have had a Barclaycard within the past six months.
- Any cash withdrawals in pounds will be subject to a 2.99% fee (min £ 2.99) and interest will be charged from the day you make them at 27.9% representative APR, so it's best to avoid.
- Make sure you pay off any purchases IN FULL before the 0% period ends or you'll be charged 19.9% interest, which'll quickly wipe the gain from this being fee free overseas.
Good for overseas spending and you earn cashback on every spend
Tandem*
The Tandem* credit card has no fees for overseas spending It's also a Mastercard, which typically offers better rates than Visa. As an added bonus, you earn 0.5% cashback when you spend on the card abroad (and in the UK). This is credited to your account on each statement date.
However, this card does charge interest on cash withdrawals, so if you're likely to make a lot of them, the Barclaycard above – which doesn't charge interest on withdrawals if repaid in full – may be a better fit.
As this is a newish card, we've little feedback, so let us know if you've used it.
Need-to-knows
- You don't get charged interest on spending abroad, provided you pay this off in full by the date shown on your statement.
- There's no fee for cash withdrawals overseas, yet you will be charged interest at 18.9% representative APR even if you pay it off in full. So it works out at about £1.50/mth for each £100 withdrawn (if you get this APR; some might get a higher APR).
- You can minimise the cost of this interest: you're only charged it until you've fully repaid the balance, so if you pay off the withdrawal amount as soon as you can (via internet banking while abroad, or when you get home) you can minimise interest.
- Some poorer credit scorers will get 24.9% APR, which will make cash withdrawal interest more expensive.
Near-perfect rates and cheap withdrawals
Halifax Clarity Mastercard*
The Halifax Clarity* has been one of our top picks for years due to its great feedback, low rates and no fees on spending or withdrawing cash abroad. It's a Mastercard too, which typically offers better rates than ones from other issuers.
Need-to-knows
- You don't get charged interest on spending abroad, provided you pay this off in full by the date shown on your statement.
- There's no fee for cash withdrawals, yet you'll be charged interest at 18.9% representative APR even if you pay it off in full. So it works out at about £1.50/month for each £100 withdrawn (if you get this APR) if you wait until your statement to pay it off.
- You can cut this cost by paying off the withdrawal amount as soon as you can (via internet banking while abroad, or when you get home) to minimise interest.
- This rate is only for the Clarity credit card, not Halifax's own travel money bureau, which generally offers lower exchange rates.
- You can get the Clarity credit card even if you already have a Halifax credit card.
- Some poorer credit scorers will get 25.9% APR, which will make cash withdrawal interest more expensive.
Easier-to-get card that's good for spending, plus 0.5% cashback, but high withdrawal interest
Aqua Reward Mastercard*
The Aqua Reward* card is designed for those with lower credit scores, but it still gives near-perfect rates worldwide. It also gives 0.5% cashback on all spending – even abroad (max £100/yr cashback). It's another Mastercard, menaing you'll get near-perfect rates.
However, primarily use this only to spend as its 44.9% rep APR is charged on cash withdrawals even if you clear in full, plus a 3% fee.
Need-to-knows
- This card's designed for those with poor credit history and will accept those with past county court judgments or defaults providing they're a year old, or bankruptcies over 18 months old.
- Credit limits are low, from £250 to £1,200.
- The rate you'll get is set by Mastercard.
- You don't get charged interest on spending abroad, provided you pay this off in full by the date shown on your statement.
- Some poorer credit scorers will get higher APRs of up to 59.9%, or 69.9% for cash withdrawals.
- If you do withdraw cash, pay it off as soon as you can (via internet banking while abroad, or as soon as you get home) so you minimise interest costs.
Best of the rest
There are a few other cards that don't charge non-sterling exchange fees when you use them to spend overseas. If you're choosing a card, remember that Mastercard's exchange rate almost always beats Visa's rate, so factor this in when making your decision.
We've included Barclaycard, Tandem, Halifax Clarity and Aqua at the top of the table for comparison, but if you already have one of the cards below, it's usually not worth switching as the gains are small. Here are the 'best of the rest' of the cheapest overseas spending cards.
Top travel credit cards that charge no fees on purchases
Card issuer ATM fee Cash w/d interest Rep APR (if not repaid) Check your chances of getting it Barclaycard Platinum Travel (1) Visa None None 19.9% (Cash 27.9% (2)) - Tandem Credit Card* Mastercard None 18.9-24.9% 18.9% Eligibility calculator Halifax Clarity* Mastercard None 18.9-25.9% 18.9% Eligibility calculator Creation Everyday Mastercard None 12.9-21.9% 12.9% - Aqua Reward* Mastercard £3 or 3% 44.9-69.9% 34.9% Eligibility calculator Santander Zero* Mastercard None 18.9% 18.9% Eligibility calculator Post Office Platinum Mastercard £3 or 2.5% 27.9% 18.9% - Aqua Advance* Mastercard £3 or 3% 44.9-69.9% 34.9% Eligibility calculator Saga Platinum (3) Visa £2 or 2% None 11.9% (Cash 19.6% (4)) - B Credit Card Mastercard £3 or 3% 27.9% 9.9% - Nationwide Select (current account custs only) Visa £3 or 2.5% 15.9% 15.9% - (1) No non-sterling fees until 31 August 2022 (2) You'll pay interest on non-sterling cash withdrawals if you don't repay your balance in full each month. Sterling cash withdrawals attract interest from the day you make the withdrawal. (3) Over 50s only – you may not be accepted if you've four or more credit/store cards. (4) You'll pay interest on cash withdrawals if you don't repay your balance in full each month. (5) New card holders from November 2013.Get Our Free Money Tips Email!
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Top overseas debit cards
It's also possible to get non-sterling transaction fee-free debit cards, but you'll need to shift bank account. It's questionable whether it's worth it just for this (as you're forgoing other bank account perks – see Best Bank Accounts), which is why we favour just getting a credit card and using it right.
There are four current account providers offering debit cards without non-sterling transaction fees, although two of them are restricted to certain areas or are only non-sterling transaction fee-free in Europe.
Fee-free spending & withdrawals worldwide with no full credit check
Starling Bank*
App-based Starling Bank* has a current account that charges no non-sterling transaction or cash withdrawal fees when you use its debit card worldwide. While it's a current account, you don't have to switch to it, nor do you need to pay in a minimum amount or have direct debits set up (so you can treat it like a prepaid card). The exchange rate you'll get is set by Mastercard, which tends to be slightly higher than Visa's.
Plus, you won't have a full credit check that other lenders can see on your file if you apply for an account (as long as you don't request an overdraft), so it could be a good option if you don't want that.
Starling Bank is a new challenger bank, which opened applications to its current account in May 2017. It's regulated by the Financial Conduct Authority and has the full £85,000 UK savings safety guarantee. For now it has no overseas fees, though it's possible this'll change in future. Initial feedback has been positive – please let us know your experiences with it.
Need-to-knows
- You can download Starling Bank's app for iOS or Android.
- You can make up to three cash withdrawals a day, totalling a max £300.
- Money in your account will earn 0.5% AER interest on up to £2,000 and 0.25% AER interest up to £85,000.
- You can apply for an overdraft if you want one – you won't automatically be given one.
Fee-free overseas spending & withdrawals, though withdrawals are limited
Monzo Bank
Monzo Bank offers an app-based current account that has no fees for overseas spending or cash withdrawals. It's also a Mastercard, so you'll get near-perfect rates.
While it's a similar offering to the Starling card above, fee-free overseas cash withdrawals are limited to £200 in any 30-day period - a 3% fee applies above this.
Monzo Bank is another challenger bank, which opened up current account applications in Oct 2017. It's regulated by the Financial Conduct Authority and has the full £85,000 UK savings safety guarantee.
Need-to-knows
While the accounts above are our top picks, here are some other current accounts to consider:
- Metro Bank: With its current account Metro Bank charges no non-sterling transaction fees or cash withdrawal fees when you use its debit card in 34 European countries. Outside Europe, you'll pay a non-sterling transaction fee of 2.75%. You can open the account online or in branch.
- Cumberland Building Society: If you have a Cumberland Plus current account with Cumberland Building Society, it charges no foreign exchange fee or cash withdrawal fees on the debit card that comes with the account. However, you need to live in its operating area – it covers Cumbria, South West Scotland, West Northumberland and North Lancashire.
Currency & credit cards Q&A
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Do I get the rate on the day that I spend on the card?
No. On all of these cards, there is a processing time. So, you actually get the rate on the day the transaction is processed by your card provider, which is usually a day or two after you used the card, but could be up to a week later.
This is important, as if there are movements in the currency markets between you making the purchase and your card provider processing it, then you could end up paying more (or less) for what you bought than you thought you were going to.
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Do the same rules apply when buying off overseas websites?
Absolutely. You'll tend to pay the same costs on foreign websites as if you were actually abroad and spending there. If you're paying in a foreign currency, all the usual charges apply – the same cheap cards are cheap, the same expensive ones costly.
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My card was blocked while I was abroad. Can I prevent this?
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When's the best time to buy currency?
There's no right answer to this, which is why this guide focuses on how to get the best rate at any moment. If the pound is strong and the euro or dollar weak, many people think, "I'm not going away for a few months, but I'll grab my cash now." If the pound's weak, many want to hold off.
There's nothing wrong with doing this, but you need to understand it's currency speculation and you're effectively gambling on exchange rate moves. Playing the currency market is something highly paid traders can't always get right. Those who do make a fortune; those who don't lose a fortune.
For more on this, read Martin's 'Should I buy euros now?' blog.
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Should I get my travel money out in the UK or overseas?
If you're going to get the cash out on a specialist overseas card, then it's better to wait until you're there.
However, if you're just planning to use a normal card or convert pounds when you're out there, there's no guarantee you'll get a better rate – and certainly changing in most hotels is normally a bad idea as they give poor rates. Overall it's safer to use TravelMoneyMax and get the cheapest rate while you're here.
The 8 need-to-knows when spending abroad
Before you go on holiday, there are some things you need to know about how credit and debit cards work overseas. Get this wrong and it can cost you large, so please read the following (even if you only have time to read and remember the headlines, it should help protect your pocket).