Travel credit cards
- Find the right credit card for your abroad spending needs – without harming your credit score
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What is a travel credit card?
Travel credit cards are designed to use while you’re travelling or on holiday. They’re an alternative to regular credit cards, prepaid travel cards and withdrawing cash while you’re abroad.
Why get a travel credit card?
Travel credit cards could save you money while you’re away. They typically cost less to use when you’re paying for things abroad – and come with other benefits.
They can also be a useful backup in an emergency, should you lose your cash or debit card.
Credit cards can help protect you from identity theft, as you won't be liable for any illegal spending if your card details are stolen and used. You can cancel your card as soon as you realise it’s missing.
Travel credit cards can give you cashback on spending, as well as commission-free purchases while you’re abroad.
How do travel credit cards work?
Travel credit cards usually have low or no fees when used abroad. Unlike other credit cards, they often offer favourable exchange rates.
Can I withdraw cash with a travel credit card?
Yes, it’s possible to withdraw cash with a travel credit card, but we recommend you avoid doing so as it’s expensive.
If you withdraw cash abroad, you’re usually asked if you want local currency or sterling. Always pick the local currency as there are high fees for converting to sterling.
How much does it cost to use a regular credit card abroad?
How much you’ll pay to use a regular credit card abroad will depend on the card. There are typically two types of fees - non-sterling transaction fees and non-sterling purchase fees.
Non-sterling transaction fees are usually made up of two parts:
- Your payment network (Visa, MasterCard, etc) takes a commission for handling the purchase
- Your card issuer will also add its own fee on top, sometimes known as foreign exchange fees.
You’ll pay a non-sterling transaction fee every time you use your credit card abroad, whether for purchases or withdrawing cash. You’ll also pay a non-sterling transaction fee if you use your card online and pay in a currency other than sterling.
You’ll be charged a non-sterling purchase fee every time you buy something with your card in a foreign currency. With standard credit cards, this can be up to 3%. Travel credit cards are often cheaper as they have low non-sterling purchase fees, or sometimes none at all.
Prepaid travel card vs travel credit card: how do they compare?
With prepaid travel cards, you load money onto the card before you travel and pay the current exchange rate. You can withdraw this money while you’re away and use your card for some – but not all – shops and services.
With a travel credit card, you’re borrowing against your credit card limit and will need to pay it off when you return.
What are the alternatives to a travel credit card?
You can spend abroad using cash, prepaid cards, debit cards and credit cards. Each has its own advantages and disadvantages.
Cash: you might think this is the easiest option. But not everyone feels comfortable travelling with large quantities of cash, as there’s always the chance it could be lost or stolen.
Debit cards: you may be charged fees for using your debit card abroad, along with foreign currency fees and fees for withdrawing cash.
Prepaid cards: some prepaid cards charge an application fee of around £10. Some also charge for withdrawing cash, topping up or getting a replacement card.
Credit cards: using a regular credit card abroad can mean paying fees, which you can avoid with a travel credit card.
A travel credit card could be your best option when travelling abroad, but you’ll need to consider your personal circumstances.
Countries where card payments are more common than cash
As in the UK, more countries are becoming better set up for cashless payments. In some countries, digital and card payments are now used more than cash.
The COVID-19 outbreak accelerated this trend, with many businesses asking for card or digital payments to avoid handling notes and coins.
The world’s most cashless societies include:
China: cashless payments via smartphone apps are increasingly commonplace, although credit cards aren’t always accepted in rural areas.
The UK Foreign Office warns that counterfeit bank notes are increasingly common, even from ATMs, and banks will not replace forgeries.
Finland: cashless payments account for more than three quarters of payments2
South Korea: about 80% of transactions are cashless. Payment apps are popular and Visa and Mastercard are widely accepted.
Sweden: cash is increasingly rare. Four out of five purchases are made electronically. Even children use debit cards. Smartphone apps are used alongside cards.
Australia: app, credit and debit card, and cash payments are all widely accepted.
Credit card for travel offers
Occasionally credit or debit card providers offer deals with no fees for using the card abroad for a certain amount of time.
These can be great, but don’t forget to note when the deal ends so you don’t end up paying expensive fees.
If you’re looking for a credit card to use abroad, our comparison tool can show you what deals are available.
The best credit card for you will depend on your circumstances.
A travel credit card may be cheaper than using your overdraft
Holidays and trips abroad can put the squeeze on finances, causing people to dip into their overdrafts.
Applying for a travel credit card and paying it off every month can mean you avoid fees.
Frequently asked questions
Why shouldn’t I use my debit or credit card abroad?
Along with fees and foreign-use charges, some credit cards charge interest for using your card outside the UK – even if you pay off the balance in full. You’ll likely also be charged if you use your credit card to withdraw cash from an ATM.
What exchange rate do I get with a travel credit card?
Travel credit cards usually offer competitive exchange rates, but always check these before you travel.
Do I need to let my bank know that I’m travelling abroad?
It’s a good idea to tell your bank you’re travelling, or your card may be blocked because your provider thinks it’s been stolen. You can often let them know via your online banking account or app.
It’s worth noting down your bank’s helpline number in case you have problems while you’re away or your card is stolen.
Should I use a travel credit card or withdraw cash when travelling abroad?
When on holiday or travelling abroad, it often makes sense to use a travel credit card instead of withdrawing cash. That’s because there’s a fee every time you withdraw cash from an ATM abroad.
Should I pay in local currency or sterling when travelling abroad?
When paying by card abroad, you’re often asked whether to accept the price in the local currency or sterling. Always pay in the local currency – converting to sterling usually means paying higher fees.
Can my credit card get blocked when spending abroad?
If you’ve told your bank you’re going abroad, your travel credit card shouldn’t be blocked. But it can occasionally happen because of security measures in place to protect you from fraud. Your credit card should have an international contact number on the back in case you have trouble using it.
Are my purchases protected when I use a credit card?
In some circumstances, you can claim your money back on purchases made with your travel credit card under Section 75 of the Consumer Credit Act. This applies to purchases between £100 and £30,000, but isn’t automatic. It depends on the supplier’s terms and conditions, the Mastercard or Visa scheme rules, and the card issuer’s approach.
How can I ensure credit card security abroad?
It goes without saying that you should keep your credit card safe, wherever you are. Keep it close and don’t reveal your PIN to anyone – shield the keypad when you make a withdrawal or key in your PIN.
If your card is lost or stolen abroad, let your card issuer know straight away.
It’s a good idea to note down your card issuer’s 24-hour emergency phone number and keep it somewhere safe with your travel documents. You should be able to quickly find these online, too.
Visa has an app to help you if your card is lost or stolen abroad.
It also has a list of emergency contact numbers.
Mastercard also has a list of global emergency contacts.
How can I find the best travel credit card for me?
Comparing with Compare the Market makes it easy to find a travel credit card that suits your needs. If you see a deal that appeals, simply click to find out more.
Compare credit cards for travel.