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There are many people living in the United Kingdom that have pushed back trips to the U.S or Europe because of the awful currency exchange rates; however, you can solve this situation by using travel money cards, which are not widely know but propose an appealing alternative.

How do travel money cards work?

These cards were recently introduced to the card market and will give the option of uploading whatever currency you choose to a plastic card, at whatever the existing rate of exchange is, and is your travel money for whatever destination you’ve chosen to visit.

You can apply via the Internet, and send funds to your card online, via phone, or even (on some cards) by sending a text message. At the moment travel money cards support pounds, dollars, and euros.

How are travel money cards superior than traditional credit cards?

Importantly, the rate of exchange is usually higher than you’ll find in a typical foreign currency exchange office. Also, the exchange rate is fixed in stone at the time you upload money to the card — so when you spend while travelling, you already know what it’s costing you. This is certainly different than credit and debit cards, which use an exchange rate that’s dynamic — whatever the going rate is at the moment you use the card.

Is that all there is to it?

Yes - there’s more. How about no additional surcharge for the currency conversion? Some credit and debit card providers tack on an additional fee of around 2.75% extra on top of the exchange rate — which costs you even more.

If you didn’t know, debit and credit cards might also elicit an additional “till charge” when used in restaurants or shops, however the currency exchange card doesn’t have this cost. Be aware that debit and credit cards have high rates for any ATM withdrawals, but the cash on the currency card have been prepaid, not borrowed, so it’s not applicable.

Anyway… Is there a catch?

Well, since the cards need to have funds transferred to them before you travel, you might find yourself having to save up for your trip, instead of just relying on your credit cards. However, considering these economic environment that’s not such a bad thing, is it? Another small drawback is the charges required for ATM withdrawals, but the good news is those fees will be a lot less on currency cards than on credit or debit cards.

One instance of this is that, when this article was written, NatWest and RBS both had a withdrawal fee of two percent, which amounts to about 6 each time you withdraw the sum of 300. Currency exchange cards, however, have a fixed fee that amounts to as little as 1.50 no matter how much your ATM withdrawal is.

The real draw back to these cards (which shouldn’t be a trouble if you use them correctly) is that you must specify the precise currency when you load the funds. If, after that, you use a dollar currency card in a euro transaction, you’ll pay foreign exchange fees up to 2.75. Of course, only some cards charge this fee, while others don’t (keep reading).

Aren’t there some good companies offering credit cards intended for use abroad?

Traditional credit cards like Post Office, Nationwide Gold, and Abbey Zero fit into this type of cards. The first two cards, though, have 2.5% withdrawal fees for cash with a minimum charge of 3 per transaction, even though they don’t carry FX fees. This isn’t as good a deal as a travel money card, unless you don’t have the cash upfront for your travels.

The Abbey card is an excellent best-buy - no cash withdrawal expenses or foreign exchange, however there is a rather high interest rate of 25.9% on cash withdrawals! (Note: currently the rate is 22.9% for Nationwide and 20.83% for the Post Office).

That’s me, convinced — tell me more. Who has the best deal on travel money cards?

The FairFX Euro Currency card is known to be the best among the euro cards at this time due to having the lowest ATM charges at 1.50 with a 0% convert fee, and great exchange rates. While the Indigo Travelcard Euro has a fairly low ATM fee at 1.95, it also has a higher convert cost of 2.75%. Then there is the ICE Travellers CashCard Euro which has a high 3, but you have no convert fee.

When it comes to dollar cards, FairFX comes at the top again: its Dollar Currency Card gives you a low $2 ATM fee with no fee for converting. Another good deal is ICE Travellers CashCard Dollar with its’ $3 ATM fee and again, no convert charge. Don’t forget no convert fees gives you the option of using these cards in any country.

What’s the best travel money card for world travel?

An ‘Anywhere Card’ has just been introduced by FairFX as a new global travellers card - an ideal card to take wherever in the world.

With a FairFX Anywhere Card there are no loading charges and no ATM fees! The only cost that applies is a 1.5% transaction fee which as far as we can tell beats every other similar type of card in the market.

Currently, FairFX is offering a free dollar, euro or sterling ‘Anywhere Travel Card’, which usually costs 9.95, for a small initial load. Why are you dragging your heels? Save money by getting a travel money card today!