If you’re heading off on a trip abroad and want to avoid carrying too much cash with you, then taking a prepaid travel card could be just the ticket.
Sometimes called a prepaid currency card or travel money card, it’s a card you preload with money to take away with you on holiday. You can withdraw cash at ATMs abroad or use the card to purchase goods and services, just as you would a debit card.
You can either preload cards with:
Cards are usually underwritten by Visa or Mastercard and can be used anywhere they’re accepted - that’s more than 35 million locations around the world.
And you can reload your card should your funds run out.
Many cards are linked to an app where you can check your balance, top up with funds and review your transaction history.
As no credit checks are required, prepaid cards are available to everyone, even people who can’t get credit or debit cards because of a poor credit history.
They’re also an option for people who have no credit history. This might be the case for people who have just moved to the UK, or younger people who haven’t built up a credit history yet.
This type of card stores just one currency - like Euros or US dollars. You load up pounds sterling which is then converted into the currency at the exchange rate on the day you load the card
These allow you to load several major currencies onto one card, useful if you’re travelling to more than one country on your trip
Load the card with pounds sterling which is converted into local currency when you make a purchase and at the current exchange rate. This offers flexibility if you’re going to travel through different countries
It’s worth comparing what fees and rates different cards charge, to determine the best deals.
Common charges to check for include:
The particular exchange rate you get will depend on the provider - so it’s worth comparing.
It could be the ‘interbank rate’ which is the rate banks use when swapping currencies and tends to be the most competitive on the market. Or it could be Visa or Mastercard’s own exchange rates.
You’ll usually also get charged a commission by the provider on top of that.
If you secure a good rate of exchange at the time of loading your card, your holiday budget could go a lot further. And if the pound drops even more by time you’re abroad, you’ll be better off again. (Though of course, if the pound rises in value after you load the card, then you’ll lose out.)
Specialist travel credit and debit cards are likely to offer competitive rates of exchange and won’t come with the big fees that many standard credit cards charge for using them abroad.
Using a specialist travel credit card abroad will also mean you’re covered by section 75 of the Consumer Credit Act.
You’ll also have the cushion of being able to access emergency funds if necessary.
Alternatively, app-only banks like Monzo and Starling let you spend and withdraw money abroad at no extra cost. Check for their full terms and conditions.
Yes, you can load your card with extra funds - usually either by phone, text, online or via an app.
It depends on the card. Some can hold up to 15 currencies - others up to 23 or more.
Most currencies in the world can be loaded onto a prepaid card. Of course, you’ll need to check that the card you’re looking at has the currency you need available.
If your card is loaded with pounds sterling, then you can use up anything left on your card when you return to the UK.
If you have foreign currency remaining on a prepaid single or multi-currency card, there’ll usually be a fee to get the funds transferred back to your bank account.