Best Travel Credit Card

27th of September 2022

In this article

When you are planning to travel abroad, you will need to decide your preferred method for paying for hotels, daytrips, eating out and all other expenses while you are on your trip.

Taking a large amount of local foreign currency is not a good idea, in case it gets lost or stolen, so other alternatives such as travel credit cards are a safer option.

Before you are due to go on your trip abroad, you should research the best travel credit cards to suit your requirements for spending overseas.

Each different credit card provider will have different fees and terms, so comprehensive research of multiple credit cards will help you to find the best financial deal to keep interest rates and transaction fees as low as possible.

What is a travel credit card?

Travel credit cards have been designed specifically to make it easier and safer for people to spend money when they travel abroad.

They offer the same convenience of a standard credit card but instead of accumulating credit card debt, you can prepay an amount onto the travel credit card.

There are many benefits to choosing a travel credit card instead of using a debit or credit card abroad, including avoiding foreign exchange fees.

Top pick travel credit and debit card

Rates and fees change on a regular basis, but the best cards currently available on the travel credit card market include:

Best travel credit cards

These are the top travel credit card deals:

Barclaycard Rewards VISA

The Barclaycard Rewards credit card is fee-free and offers 0.25% cashback as an added incentive for overseas spending.

With this credit card option, there are no fees for withdrawals overseas and you get five months of free access to Apple Music.

Halifax Clarity credit card

The Halifax Clarity credit card is one of the best choices for travel credit cards, with no fees and £20 cashback when you use the card within the first 90 days.

If you make cash withdrawals, there is interest of around 5p per £100 per day, so you should try to keep cash withdrawals to a minimum to avoid getting charged interest with your Halifax credit card.

118 118 Money Mastercard

The 118 188 Money Mastercard is available for people who have a poor credit score, either through missing payments for an existing credit card or any previous adverse credit history.

With the 118 118 Money Mastercard, there are no fees when you withdraw cash abroad but there is a 34% rep APR if the balance is not paid in full.

Natwest Credit Card Mastercard

The Natwest Credit Card Mastercard is available for existing Natwest customers and has a number of perks, including no fees on overseas spending but there is a 3% fee for ATM withdrawals.

If you want to limit the amount of money you spend using a credit card abroad, you should either avoid withdrawing cash or find a credit card provider who does not charge fees for withdrawing cash.

Cash withdrawal fees are one of the biggest costs of spending abroad, so paying for transactions with your travel credit card is usually better than making frequent cash withdrawals.

Travel credit and debit cards how do they work?

A travel credit card can be used in the same way that a normal debit or credit can be used to make transactions for purchases, pay bills and withdraw cash.

A travel credit card is designed specifically to be used abroad and while your bank will charge you a non-sterling transaction fee of around 3% to use a credit and debit card, a specialist travel credit card will not have this fee.

There is also usually a flat fee every time you use your card overseas, which is another reason to choose a travel credit card.

A specialist card can save money per holiday

When you travel abroad, there are lots of items that you will need to pay for that cannot be paid for in advance. For example, eating out at restaurants, transport and some day trips will need to be paid for while you are abroad.

With most credit cards, when you are spending abroad, you will have foreign exchange fees and be charged interest. Using special travel credit cards can avoid many of these fees.

Travel credit cards can save you over £50 per holiday by offering a better exchange rate and no foreign transaction fees.

Can I withdraw cash with a travel credit card?

Yes, it is possible to withdraw cash abroad with a travel credit card but some credit card providers will charge a fee for ATM withdrawals.

How much does it cost to use my credit card abroad?

The cost of using your credit card abroad will depend on a large number of factors, including which credit card provider you choose and how you use your card abroad.

Withdrawing cash will incur a cash withdrawal fee of around 3% with some credit card companies.

If you are planning on withdrawing cash on a regular basis when travelling, you should try to find a credit card with no cash withdrawal fees or the lowest fees.

What are the best credit cards to use abroad?

There are lots of different types of credit cards to use abroad, including:

Credit cards with no foreign transaction fees

Many cards charge you for buying or taking cash from abroad. This fee is 3% per month for use of cards. This equates to 6p per £200 spent, which is a very large charge. Travel Credit Card offers a free credit card for purchases in the foreign country.

Airline credit cards

You can also apply for airline credit cards that allow you to earn points that you can convert into flights.

Travel money cards

A travel money card is a prepaid currency card that makes it easy to spend money abroad. It allows you to make foreign transactions without paying an interest rate because you prepay an amount onto the card.

Applying for a travel money card is different to applying for a normal credit card, as there are no credit checks so a prepaid card is a good solution for people with bad credit. This article can read more about how travel money cards work compared to other specialist travel credit cards.

What are the benefits of a travel card?

There are many great benefits of using a travel card to spend abroad, including:

Protected purchases

When you use a debit card abroad, you do not have the same level of protection as when you use travel credit cards, the Consumer Credit Act will usually protect you. Using travel credit cards will ensure better purchase protection, as credit cards are covered uner the Consumer Credit Act, while debit cards are not.

Preferable exchange rates

Using a specialist travel credit card is one of the better options for overseas spending as they usually offer a preferable exchange rate. A specialist credit card for foreign transactions will have a near perfect exchange rate.

Security

As well as having purchases protected with credit cards, it is more secure to take a specialist credit card rather than foreign currency. If your foreign currency is lost or stolen, there is little protection to cover your loss unless it is covered under your travel insurance policy. With travel credit cards, you can cancel the card as soon as it is lost or stolen and you have fraud protection.

Which travel card is best for UK?

The best deals for travel credit cards in the UK right now are:

Barclaycard Rewards VISA
Halifax Clarity credit card
118 118 Money Mastercard
Natwest Credit Card Mastercard

How to find the best overseas credit card

The credit cards listed above offer some of the best current deals but which one is right for you will depend on your personal circumstances and how you are planning on using the credit card.

Before applying for any type of credit card, you should check that the provider is on the financial services register. You will often find that banks offer better deals to existing customers, so you can check what your existing bank offers.

There are many different types of potential fees and charges on credit cards, so you should do some research to find out how travel credit cards work, so that you fully understand how you will be charged for spending and withdrawing cash abroad.

The best travel credit cards will have zero fees or very low fees and will not apply a non sterling purchase fee. You should also look for the specialist overseas credit card with the best exchange rates. To help you to monitor your charges when you spend abroad, use a provider who offers online banking, so you can check your balance and fees by using an online banking app or website.

Most credit cards have a transaction fee of around 3% and cash fees of around 1% (with a minimum charge of £3), so you should be wary of any credit cards that are charging higher fees than this.

Use the travel credit card to pay for an ESTA or US Visas

If you are planning on travelling to the USA then you will need to apply for the relevant travel authorisation before you depart. There are two options, depending on your purpose for travel and country of citizenship:

ESTA

An ESTA (Electronic System for Travel Authorisation) is available for travellers who are citizens of countries listed under the Visa Waiver Program. You can use an ESTA for tourism, medical or transit purposes, as long as your trip to the US is for no longer than 90 days.

To apply for an ESTA, you must complete the online ESTA form and pay the application fee, which you can do with a credit card, debit card or travel credit card. Applying for an ESTA is a quick and simple process, completing a short online form that take around 20 minutes in total.

How long does it take to have ESTA approved?

Once you have filled in all of the required information, check the details you have provided before submitting the ESTA. It will then be screened to check against security databases and if there are no issues flagged, your ESTA will be approved, which usually takes less than 24 hours.

When the ESTA is approved, it is issued for 2 years or until your passport expires if that date is sooner. While the ESTA is valid, you are able to visit the US multiple times using the same ESTA, provided that your travel purposes are included under the ESTA rules.

The ESTA electronically links to your passport, so when you enter the US border, the border control agents will check your passport and see that there is valid travel authorisation for you to enter the US.

US visas

If you are not a citizen of a country listed in the Visa Waiver Program, or you are travelling to the US for purposes such as work or studying, you must apply for a US visa rather than an ESTA. To apply for a US visa, you are required to book and attend an interview at the US embassy and provide the relevant documents associated to your reason for obtaining a visa.