Top cards for travelling abroad
One of the cheapest ways to spend abroad
If you're planning an overseas trip, or regularly buy from overseas websites, a specialist travel credit or debit card is one of the cheapest way to spend as it gives near-perfect exchange rates worldwide. This guide includes the top-pick travel cards, the cards to avoid, and how to check what your card's charging you.
Alternatives to specialist overseas cards...
Prepaid travel cards have no credit check, plus give you the ability to lock in an exchange rate before you travel.
Top prepaid travel cards
How do travel credit and debit cards work?
Most credit and debit cards let you spend abroad, but will charge you for the privilege. Although your card provider gets near-perfect rates, it usually adds a foreign transaction fees (officially called 'non-sterling transaction fees') of about 3% – so £100 worth of foreign currency costs you £103.
On top of this, some debit cards charge a flat fee (typically 50p-£1.50) each and every time you spend overseas, regardless of the amount. Withdrawing cash usually attracts fees and unavoidable interest on credit cards. See hidden holiday spending charges for full details.
The good news? There are specialist travel cards that don't charge these fees, so you get the same near-perfect rate the bank does.
A specialist card can save you over £100 per holiday
Here's how much spending $1,000 can cost in pounds (we assumed five $100 cash withdrawals and 20 transactions of $25 each on the cards):
- Top specialist credit/debit card repaid in full: £779
- Top prepaid card: £779
- Cash via cheapest bureau (pick up in London): £786
- Cash from M&S on the high street (non-cardholders): £792
- Using a debit card with a spending charge: £833
- Changing cash at airport (not pre-ordered): £909
As you can see, the differences can be sizeable, yet the winners are simple. Apply for a specialist overseas card, then use it every time you go.
Check if your card charges foreign transaction fees
Never just blindly spend abroad with ANY card, use our tool to find out what it'd cost you to pay with your existing plastic before slipping it into your suitcase. Then compare that to our top-pick travel cards which don't charge, so you're armed with the cheapest way to spend.
Let's make this plain: don't use the cards in this section for spending overseas. Unless you're spending euros in the EU, Iceland, Liechtenstein or Norway, the cards below charge 50p to £1.50 for transactions on top of their normal exchange-rate charge.
Imagine you buy something for the equivalent of £5 in a shop in the USA. With the worst of these cards, it can end up costing £6.60 with the fee and charges.
|TSB (2)||2.99%||1.5% (min £2, max £4.50)||£1|
|Bank of Scotland||2.99%||£1.50||50p|
Travel card need-to-knows
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.
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 – see Martin's euro analysis for how this worked for him on a European trip.
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.
If you've a top overseas credit card, spending is almost always cheaper. Even on cards with no cash withdrawal fees, you'll usually still pay interest on the withdrawal until you pay it off.
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 often still a fee (as well as the non-sterling transaction fee) when you use a cash machine.
Since Brexit, more and more overseas ATMs have started to charge (higher) fees, so do keep an eye out.
Should I withdraw my travel money 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.
Does withdrawing cash on a credit card affect my credit score?
Any cash withdrawals you make on a credit card will be recorded at the credit reference agencies. On their own, they shouldn't matter too much, but if you have a history of poor credit, or you're looking to make an important credit application soon, they're best avoided.
Because it's usually quite expensive to withdraw cash on a credit card, lenders may see it as you being desperate for cash, and will count it against you if you apply to them.
For more information on the pros and cons, read our Withdrawing cash on a credit card guide.
4. Not all cards are equal – Visa's exchange rates tend to be a tad better than Mastercard, but there's very little in it
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).
When we compared rates across a couple of months, Visa had a slightly better exchange rate on 91 occasions, with Mastercard winning 72 times. The differences were also very small, often a few pence per £100 of currency – so there's little to separate them.
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. That's why you should always get one of the specialist cards in this guide, which don't add fees on top.
Top travel credit and debit cards
These are the best cards to use abroad – all have no exchange fee when you spend, and the very top picks also have fee-free and interest-free overseas cash withdrawals.
We've marked whether each card's a Mastercard or a Visa as it does make a slight difference to their exchange rates (Visa tends to be a touch better – see Mastercard vs Visa rates).
It's a tough call – our top three picks all offer fee-free spending abroad and ATM withdrawals. Which wins depends on your preference.
- Chase is our top-pick debit card – it gives 1% cashback on most spending for at least a year. You do have to open a new bank account, but it's easy to get, only requiring an ID check instead of a full credit-check. Do note, there's a £1,500/month limit on ATM withdrawals. If something goes wrong with something you bought overseas on this card, you may have chargeback protection.
- Barclaycard is our top-pick credit card as it offers interest-free withdrawals, plus gives an ongoing 0.25% cashback. You also get Section 75 protection if you buy something costing more than £100 on it, which is stronger protection than the debit cards give.
- First Direct's boon is that it pays a FREE £175 if you switch over your existing bank account – beating the cards above for all but the biggest spenders. It's also been top or near top of every customer service poll we've ever done. If something goes wrong with something you bought overseas on this card, you may have chargeback protection.
We've more choices below if none of the above suit – all are decent picks in their own right and are fee-free to spend on abroad, though some charge interest or have ATM fees/limits.
- New. Via our link, Currensea Mastercard debit card newbies get £10 cashback when spending £100+ in any foreign currency within the first six months. The Currensea card works a little differently to the other credit and debit cards featured here, as you link it to your existing bank account via Open Banking. Then, when you spend or withdraw on the Currensea card, it charges your linked current account in pounds (via direct debit), neatly avoiding the non-sterling transaction fees and ATM fees that most banks charge.
Rates for popular currencies like euros and US dollars can be slightly worse than the above cards, though there's not much in it. And if you prefer the idea of something that's linked to an existing account, the cashback is a bonus. Full info in our Currensea review.
- With Starling's Mastercard debit card*, all overseas spending and ATM withdrawals are fee-free and interest-free (max six withdrawals/day, max £300/day), and like Chase above it only requires an ID check instead of a full credit-check. Full info in our Starling review.
- If you want a credit card, the Halifax Clarity Mastercard is a decent alternative to the Barclaycard above. The main difference with this card is that you're charged 23.94% to 28.94% interest on ATM withdrawals, even if repaid in full. So it's best for spending on, rather than withdrawing cash. Halifax has asked us to link only to our eligibility calculator – as it doesn't have this card available to apply for directly.
- New app-only bank Kroo's Visa debit card* is entirely fee-free for overseas spending, and overseas ATM withdrawals are also fee-free until 31 October 2023 – after this date overseas ATM withdrawals are only fee-free up £200/month (there's a 3% fee on anything withdrawn over this limit). It also pays 4.35% AER savings interest on up to £85,000, and only requires an ID check to open. Read our full Kroo review.
What are the alternatives to travel credit and debit cards?
If you don't want a new credit or debit card, but you still want to be able to maximise the bang for your buck (or euro, or dong) there are a couple of other ways to spend that you can look at...
- Prepaid travel cards. These let you load them up and lock in a rate in advance. Some charge huge fees or take a cut of the exchange rate, but cards like Revolut and Wise tend to offer a decent deal, often rivalling the cards above. See full information and our current top picks in prepaid travel cards.
- Prefer cash? Useful if card isn't accepted, our TravelMoneyMax travel money comparison tool helps you find the best exchange rates for your holiday money.
Want to complain about your card provider?
If your card company has charged you the wrong amount, charged interest when it shouldn't have or its service has been atrocious, then you don't have to suffer in silence.
It's always worth trying to call the provider first to see if it can help, but if not, you can use free complaints tool Resolver. The tool helps you manage your complaint, and if the company doesn't play ball, it also helps you escalate your complaint to the free Financial Ombudsman Service.
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