In a recent series of managing money while travelling, Marlene Scicluna talked about ways to pay when you’re in a foreign country (you can read the first part here). In this second part, she explores two more: debit cards and travel cards.

Any international travel plans should include establishing trip finances and whether payment will be made by cash, bank cards or a combination of both. As every option comes with pros and cons, it is essential to evaluate what will work best for your specific needs and budget.

Having featured cash and credit cards in a previous article which can be read here, today I’ll be exploring alternative bank cards offering convenience for travellers who are aiming to control their cash flow.

Debit cards

Debit cards can be added to an existing personal bank account, giving you access to your own savings. However, unless your provider offers an account that does not charge fees, you may be charged costly foreign transaction fees.

Much like a credit card, debit cards tend to be linked to Visa or Mastercard, making them widely accepted around the world. Yet, unlike credit cards, debit cards often do not offer benefits like travel insurance, reward points or purchase protection.

There are benefits and drawbacks, including:

• International ATM access could be cheaper when using ATMs in your card’s partner networks; however, currency conversion fees may still apply.
• Although debit cards offer full access to your bank account and are easily managed via apps on your phone, your bank account and financial details could be compromised if card is lost or stolen.
• Although debit cards may offer some fraud protection, transactions are debited directly from your bank account, making funds potentially more complex to recover.
• Whilst some merchants might not accept debit cards for pre-authorisations, using debit cards for security will place a ‘hold’ on your funds that could last for several weeks.

Always check with your provider whether your debit card can be used internationally and notify them before you start travelling.

Travel cards

Travel cards offer a convenient and cost-effective option allowing travellers to use their own money to preload foreign currencies onto the one card. They can then be used worldwide for in-store or online purchases as well as ATM withdrawals.

The fact that you can only spend what you have loaded on the card makes it easy to control your spending. Additionally,

• Some travel cards allow several currencies, which can be quite handy when travelling to multiple destinations.
• You could take advantage of a good exchange rate at the time you preload your money without the need to worry about fluctuating rates.
• Some cards may allow ‘on the go’ top ups.
• Unlike credit cards, your transactions will not attract currency conversion fees as your funds will already be in the country’s currency.
• Most travel cards are PIN protected.
• Unlike debit cards, travel cards are not connected to your savings thus, if stolen, your financial details won’t be compromised.
• Lost or stolen cards can be replaced, and users may have access to emergency funds.

However, there are also potential downsides:

• Travel money cards may come with several fees including purchase and issuing of card, loading currency, ATM withdrawals, balance inquiries, inactivity and cashing out the balance.
• Loading times when transferring money may take several days, which means you need to plan your transfer in advance.
• Not all overseas merchants accept travel cards, so it may be a good idea to carry some cash.
• While not all merchants may accept them for pre-authorisation, using travel cards for this purpose may place a ‘hold’ on funds that could last several weeks.
• Whilst the funds loaded on the card won’t expire, the card itself can and you could be charged a fee to replace it.
• Some prepaid cards may put a daily limit on how much you can spend, which can be a pro and con.

Before making a decision, it could be worth comparing all bank cards and available options to make the right call for you and your trip.

Like every article on this website, this is not personal financial advice.