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Prepaid Travel Money Card Guide

Find out all you need to know about prepaid travel money cards with our guide, including advantages, where to use your card & which cards have the best rates.
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What is a prepaid travel money card?

Prepaid travel money cards (or currency cards) are payment cards that you can load money onto before you go away and use while you’re abroad.

Unless you opt for a single-currency card (which lets you spend in one currency e.g. US Dollars), a multi-currency card will allow you to hold multiple currencies on your card at once. You can then use this card to pay for things in card machines abroad, as you would with a normal debit or credit card.

 

How do prepaid travel cards work?

What are the advantages of a travel money card?

✔ Security 

Storing your money on a travel money card is much safer than carrying lots of cash as your card is PIN-protected and can be frozen immediately if you lose it. Since currency cards aren’t linked to your personal bank account, there’s much less risk involved if your card is stolen. And if you do lose your card, most providers will even send you emergency cash or a replacement card.

✔ No hidden fees

Most travel money cards let you spend without any transaction fees (compared to a 2.75% or 2.99% non-sterling transaction fee using your debit card abroad!), as long as you pay using a currency loaded on the card. Some prepaid cards do charge additional fees (e.g. a small ATM withdrawal fee), but you’ll know about these up front, and can choose your card based on its fees and limits.

✔ Manage your money on the go

Most cards now come with mobile Apps, so you can top up and track your spending on the go. Since you can only spend what’s on the card and can easily see how much you have left, prepaid cards are great for helping you stick to a budget while away.

✔ Competitive exchange rates

You’ll generally get a much better rate of exchange with a currency card than you would with your debit or credit card. Being able to ‘lock in’ your exchange rate also means you’re protected from any fluctuations in the market, particularly if you top up on a day when the rate is good.

✔ You don't need a clean credit history

While credit card providers will require you to have a good credit score, anyone can qualify for a currency card. They will also have no bearing on your credit history going forwards.

ALWAYS TRANSPARENT ALWAYS TRANSPARENT

What are the disadvantages of a travel money card?

✘ They can’t be used for every purchase

There are some things, such as pre-authorised transactions, currency cards can't be used for as they don't come with an overdraft and aren't attached to a bank. You might want to use a different card to put down a security deposit at a hotel or pay to hire a car as your balance might not be high enough to cover the final bill amount, and prepaid cards don't let you borrow the difference.

✘ Less risk = less reward

A locked-in exchange rate protects you from any negative shifts in the currency market, but it also means you won’t benefit if the rate suddenly improves dramatically.

✘ They don't serve all currencies

Most providers only offer currency cards for a limited number of currencies. If you’re going somewhere exotic, you might need to get some old-fashioned cash for your trip.

✘ Sometimes only cash will do

Wherever you are in the world, it’s likely that you’ll encounter a situation where you need a bit of cash. Markets, taxis and smaller shops may be only take cash payments, particularly when you move outside of capital cities. To be safe, it’s a good idea to carry a small amount of cash with you in addition to a card.

RATES FLUCTUATE Copy

What exchange rate will I get on a travel money card?

When you load your money onto the card, you’ll get the exchange rate on the day you top it up. That amount will remain fixed, regardless of what happens in the currency market – unlike your debit or credit card, which will charge you the interbank rate (which can vary).

Different providers offer different rates, so the exact rate you get will depend on where you buy your card. Some use Mastercard or Visa’s exchange rates, others use these rates and add a certain percentage of the exchange fee and some use the interbank rate (the dynamic rate at which banks swap currencies between one another). The best way to secure a good rate is to look at comparison sites like MSE – which offer real-time comparisons of the rates of the day.

Travel money card exchange rates compared

(Based on exchanging £1000) 

 

RATE

YOU'LL GET

ICE Clear card 1.076 €1,076
Post Office Travel Money Card 1.069 €1,069
FairFX Euro Card 1.065 €1,065
Caxton Currency Card 1.065 €1,065
Moneycorp Explorer card 1.064 €1,064
Travelex Money Card 1.062 €1,062

 

EUR exchange rates were those quoted on the respective providers' websites. Rates checked as of 10:27 on 05/08/2019.

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MANAGING APP

How do I get a prepaid travel money card?

Most prepaid cards have a simple online application process.

Cards are usually free, but often require a minimum load amount (usually around £50). Some providers will charge an application fee, but this is quite rare.

If buying your card in store, you’ll need a form of ID like a passport or driving license. If buying it online, the card will usually have to be delivered to your home address for security purposes.

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How safe are travel money cards?

Currency cards are a very safe travel money option as, like your debit card, your prepaid card will be PIN protected, and can be easily frozen if lost or stolen.

However, since it isn’t linked to your personal bank account, you don’t need to worry about the funds in your main account, so the stakes of losing your card are much lower.

As long as you contact the provider of your currency card to freeze your funds, you shouldn’t lose any money. Most providers will send you a replacement card or emergency cash straight away, although you may need to pay £10 for this.

It’s worth noting that the money loaded onto a travel money card is classified as electronic money (or e-money). This means it isn’t protected from the Financial Services Compensation Scheme (FSCS) if your bank or building society goes bust. For this reason, it’s advisable not to keep large amounts of money on your card.

CARD FEES & LIMITS CARD FEES & LIMITS

What fees will I be charged?

Travel money cards vary hugely when it comes to fees, so always look at the fees closely before you choose one.

Key things you might be charged for are:

  • ATM withdrawal fees
  • Transaction fees (this is usually a % of the purchase value)
  • Inactivity fees
  • Top up fees
  • Application fees