All you need to know about travel credit cards

A woman on holiday using a travel credit cardWhen you’re on holiday or on a business trip abroad, the last thing you want to be dealing with is extortionate ATM withdrawal fees or even worse, not being able to use your credit card at all.

If you use your credit card abroad but your provider thinks it’s fraudulent activity, they may pause all use of your card until you can prove it’s you that’s spending on it. So if you are planning on spending abroad, you might want to look into credit cards for travelling abroad that you can use for things like shopping. Some credit cards for travel purposes are free to use overseas, whereas others still come with fees that you need to be aware of.

In our guide to travel credit cards below, we take you through the best credit cards for travel rewards in the UK, as well as how to find a credit card with no charge abroad.

Can I use my credit card abroad?

Depending on the type of credit card that you currently have, you might find that you’re able to use your credit card abroad without getting a travel-specific one.

Most regular credit cards will let you use them abroad to buy things and to withdraw cash from ATMs while on holiday, but you may find that there are associated costs and fees with using your credit card abroad such as foreign transaction fees, withdrawal fees and conversion markup fees.

Therefore, you might want to opt for a travel-specific credit card that you can use in many countries around the world without having to pay additional hidden fees.

How do travel credit cards work?

Travel credit cards work just like normal credit cards in that they allow you to spend money abroad and take cash out of ATMs. However, they don’t usually charge a fee for overseas use and they usually offer great exchange rates, so you’re not losing out on a lot of money when spending abroad.

The only catch with travel credit cards is that they might charge slightly higher interest rates, but as long as you pay them off within the agreed-upon repayment period, you shouldn’t notice any effect. Some travel credit cards may also charge non-sterling transaction fees of around 3%, so this is something you should look out for when searching for the best travel credit cards.

Types of travel credit cards

When it comes to finding the right travel credit card for your needs, it’s important to think about what you want to get out of it. Cards such as a Monzo aren’t specifically designed as a travel credit card, but they can be used overseas without any foreign transaction fees. However, the withdrawal fees from ATMs depend on how you use the card.

Air miles credit cards

For example, one of the best ways to spend money abroad, particularly on flights, is to take advantage of credit cards that offer air miles as a reward. 

Providers such as Amex and Avios both offer rewards when you spend money using their cards and you can earn huge bonuses that enable you to benefit from cheaper flights and often even free flights depending on how many air miles you rack up.

Prepaid travel cards

Also referred to as a travel money card, prepaid travel cards enable you to pre-load them with money before you travel abroad which you can use to spend money on holiday so you don’t need to carry lots of cash around with you.

They’re similar to travel credit cards in that they allow you to spend money abroad, but you don’t have to worry about paying anything back or getting into debt as a prepaid card is already loaded with money and you can only spend what’s on the card.

What credit score is needed for a travel credit card?

The credit score required for a travel credit card depends on which credit reference agency you obtain your score from and the type of credit card provider you choose.

Of course, just like with any line of credit, you will usually need to have a “good” credit score and depending on which credit reference agency you use, you can usually expect to need a score of between 881-999 with Experian, 420-700 with Equifax and 604-710 with TransUnion.

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Travel credit cards for beginners

Finding the right travel card for you depends on what you want to get out of it. For example, would you prefer to just be able to spend money on the card while abroad, or are you looking to make cash withdrawals from ATMs as well? Take a look below at some of our top recommendations for travel credit cards for beginners.

  • Halifax Clarity Mastercard - no ATM fees.
  • Barclaycard Rewards Visa - no ATM fees and no interest charged on cash withdrawals if paid in full.
  • NatWest Mastercard - 3% fee at ATMs.

How to find the best credit card to use abroad

In order to find the best credit card to use abroad, the first and most important thing you need to do is compare credit cards from an array of providers.

You will need to consider the following when it comes to finding the best travel credit card:

  • Does it have any ATM withdrawal fees? If so, how much?
  • Does it cost you when you spend money abroad?
  • Are there any interest rate fees you need to know about?
  • Will you pay in pounds or in the local currency (you should try to look for a card that allows you to pay in the local currency so you get a better rate)?
  • What kind of exchange rates can you expect from the credit card?

By using comparison tools and evaluating the best credit card to use abroad, you’ll be able to ensure that you won’t be hit with any hidden or unexpected fees while using it on holiday and most importantly, you’ll know that you’ll be able to access your money while abroad.

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