Our seasoned professionals discuss the benefits and drawbacks of using a prepaid card while on vacation.

Travel moneyusing prepaid cards for spending abroad 442223

Utilizing pre-paid cards for spending money while travelling

What exactly are “prepaid cards” you ask?

When it comes to holiday spending money, the most recent trend to hit the market is prepaid travel cards. You can load cash onto these pay-as-you-go plastic currency cards in a manner that is comparable to that of loading cash onto an Oyster card or a pay-as-you-go mobile phone. You can buy these cards from merchants on the high street or online.

Why are prepaid cards so popular for use when making purchases in a foreign country?

For a variety of reasons, more and more people are turning to the use of prepaid cards while travelling internationally. While it comes to their finances, some customers find it reassuring that they cannot go into the red or overspend on their budget when using a prepaid card, while others are drawn to the protection that these cards provide.

Money that is put onto a prepaid card is safeguarded in the same way that cash or travellers checks are protected in the event that the card is lost or stolen. However, if you need a new card delivered to you, there is a possibility that you will be required to pay for this service. Take it further: How to discover the best prepaid card – here, we explain how to pick the finest prepaid card for your needs.

Is there anything that could go wrong when using a prepaid card?

The most common currencies that may be loaded into prepaid cards are the United States dollar, the pound sterling, and the euro; however, other currencies are becoming more readily available. If you are heading to a country that uses none of these major currencies, a prepaid card might not be the best option for you because using a card denominated in sterling might require you to pay additional fees for making transactions in other countries.

When you load money onto a prepaid card, the rate of currency conversion that you receive at the time of the top-up is, in most instances, predetermined. This could be an advantage for you if you anticipate that the exchange rates for money will go worse while you are away. On the other hand, it could be a disadvantage for you if the exchange rates get better after you have loaded currency onto your prepaid card.

It is important to be aware that although while Visa and MasterCard prepaid cards are included in their respective chargeback systems, you will not be eligible for Section 75 protection if you make purchases using a prepaid card. This is something that you should keep in mind. Because of this, you should give it some serious consideration before using it to pay for a significant transaction such as airfare or a hotel room.

It is advisable to use prepaid cards.

Prepaid cards issued by CaxtonFX, Escape Travel Money, My Travel Cash card, and Travelex have earned high marks from industry professionals due to the fact that, in comparison to other types of prepaid cards, they levy very few fees. Some companies will charge you a price to get a prepaid card, others will charge you a fee to add money to the card, and still others will charge you extra for any additional cards you ask for.