Travel money prepaid cards offer a secure and straightforward way of taking foreign currency abroad. They help avoid the problems associated with exchanging traveller's cheques and reduce the risk of your current account details being lost abroad.
What's the best prepaid travel card?
All prepaid travel cards are slightly different in terms of the functionality they offer, the rates of exchange they apply and fees they charge for use.
Getting the right prepaid credit card for you means balancing a number of charges against their associated features and benefits. This means it helps to have a good understanding of what you’ll use the card for.
For instance, if you’re planning to stay in a resort town and you’re “self-catering”, your needs may be very different to those of people at an all-inclusive resort miles from civilisation (and ATMs). If you're only likely to be visiting Europe in the near future then a prepaid Euro card could be better than a multi-currency prepaid card. Of course, if you’re not sure exactly where you’ll be staying or you don’t know what to expect, you could be better off keeping your bases covered with a more rounded product.
What are the advantages of prepaid travel cards?
Prepaid travel cards (or currency cards) offer numerous benefits over more traditional alternatives for foreign currency arrangement.
Prepaid travel cards enable holidaymakers, business people and others to spend more time enjoying their trip, because most are underpinned by one of the large card processing networks (Visa/Mastercard/AmEx), meaning customers can quickly find an ATM which accepts their card and withdraw money rather than searching for banks which accept traveller cheques or exchanging at a hotel at a poor conversion rate.
Many prepaid cards can be loaded by 3rd parties, enabling parents and loved ones to quickly get funds to a relative in need
Prepaid travel cards offer consumers a buffer from their personal banking arrangements. Losing a prepaid card might be frustrating, but it is unlikely to impact the individual as much as losing their current account card.
What are the disadvantages of prepaid travel cards?
As the strength of the benefits associated with each card varies by each consumer’s unique circumstances, so do the disadvantages. However, there are some common elements consumers should watch for when assessing what’s the best prepaid card is for them.
Be sure to understand when the exchange rate for your cash is fixed. Many products fix the rate at the point that you initially load funds. If you’re loading a while before your trip, it’s worth thinking about what you expect currencies to do in the meantime. If you expect the pound to lose value, then loading might be a good idea (as you’ll be getting more foreign currency for your money – equally if you expect the value of the pound to increase, then don’t load until the last minute).
Make sure you’re aware of any load commitments for taking specific products
Check whether your issuer charges for inactivity – you may find you’re better off cancelling at the end of your trip and applying again when you next travel (this has the advantage of enabling you to access to the current best deal, so could be viewed as best practice anyway)