Travel Credit Cards can change the way you travel. See how this type of travel card can benefit your next trip.
Whether you're a regular traveler or planning a rare getaway, choosing the right way to take money abroad can seem like a daunting task. And let’s face it, the last thing you want to be thinking about while overseas is money woes and credit card fees. Save yourself the hassle. The following page has everything you need to make an informed decision about taking a credit card overseas with you. This is our comparison of credit cards that are suitable for travel.
You’ll find credit cards with low or no international transaction fees, credit cards that offer convenience and ease of use overseas and credit cards with extra perks, like insurance or rewards, listed on this page.
Compare different types of travel money credit cards
Credit cards for travel
How it works: Credit cards provide more liquidity and access to cash overseas for peace of mind. Credit cards also allow you to access the exchange rate of the day, which may be higher than the rate you have secured beforehand with prepaid travel cards.
How a credit card can suit your travel money needs.
- Receive the exchange rate on the day. Not being able to lock in the exchange rate can work to your advantage. If your domestic currency appreciates against the destination's currency when you are travelling, you can exchange your money for a better rate.
- Travel now, pay later. Credit cards can provide up to 55 days interest-free on purchases and 0% purchase offers. These features provide extra funds and flexibility for your travel money needs.
- Rewards and frequent flyer points. Earn points with rewards programs and frequent flyer programs while you travel.
Things to note when using credit cards for travel.
- No backup cards. Credit cards only provide additional cards instead of backup cards. As a result if your credit card is lost overseas it may take 1-2 weeks for a new card to be sent to your whereabouts.
More information on different types of travel credit cards
- No Currency Conversion Fee Credit Cards
- Frequent Flyer and Rewards Credit Cards
- 0% Purchase Credit Cards
- No annual fee credit cards
- Gold, Platinum and Black credit cards
No Currency Conversion Fee Credit Cards
- Avoid getting charged a fee for currency conversion when making purchases overseas or online.
Frequent Flyer and Rewards Credit Cards
- Some cards offer bonus points when you spend overseas.
- Make good use of a rewards card and you could be entitled to discounts on air tickets, access to services and perks like airline lounges or enjoy a cash back for every dollar spent.
- Make sure you’re actually going to benefit from a rewards card before you sign up, or it could fall into one of those ‘seemed like a good idea at the time’ moments. Generally, you need to pay your balance in full (so you get interest free days) to see any net value from the rewards on offer. You also need to spend a certain amount on the product so the rewards cover the cost of the product’s annual fee (if applicable).
- And then there’s the currency conversion fee to consider. While rewards cards might seem sweet, check how much your are getting charged for other things like currency conversion. For example, if your rewards cards offers a %2 cash back, but charges %3 for international transaction fee, and doesn’t offer anything else in the way of rewards, you might want to look elsewhere.
Purchase Credit Cards
0% purchase credit cards give the holder an interest-free period when you first open the account. It is an introductory offer, designed to draw new customers in. After the interest free period is over, the interest rate jumps back to an interest rate which will last the life of the card. The second interest rate is typically quite high.
Wise use of a 0% purchase credit card can provide interest-free financing for short term expenses, like travel.
- If you make good use of the card’s features, terms and conditions, there is no reason why a 0% purchase credit card can’t be used to as a form of interest free finance for your holiday. Make your minimum payments and pay your balance off at the end of the introductory period, and you’ve given yourself an short-term, interest-free loan.
- If you are unable to make the minimum monthly repayment or pay off your balance at the end of the interest-free period, you could find yourself paying back your loan on higher than average interest rates.
- The feature of an interest free period can be available on other cards, typically platinum, gold cards.
No annual fee credit cards
These cards are pretty self-explanatory, and tend to also be described as no-frills cards, or everyday days. No annual fee cards do not charge the cardholder an annual account or card holding fee. They also come without ‘bells and whistles’ and will tend not to have features which are useful for travel.
Typically, no annual fee credit cards will charge for currency conversion and will not entitle the user to rewards or come with travellers freebies. On the other hand, if you are only taking your credit card as an emergency card, don’t plan to use it frequently, or think that you won't benefit from rewards, not having to pay a high annual fee could be enough incentive to take this type of credit card with you on holiday.
- No annual fee. Pay nothing to keep this card in your wallet.
- No annual fee credit cards also come with up to a number of interest free days if you pay your account in full each month. This means you can make interest free purchases between statement periods. Some no annual fee credit cards also feature a low ongoing purchase rate of interest or purchase rate promotion when the account in opened.
- If you are planning a trip away and will be transacting overseas, make sure you are aware of the charges for international transaction on your no annual fee card. Because these cards are ‘no frills’, often they don’t offer features or entitle the cardholder to benefits that are useful when abroad.
Gold, Platinum and Black credit cards
On the other side of the spectrum to ‘no annual fee’ credit cards are gold, platinum and black credit cards, which offer the holder a range of freebies, features, extras and benefits, usually in exchange for a high annual fee.
Often complimentary international travel insurance is included with these products, which is money saved before you’ve even left the country.
- Many of the features previously mentioned in this article will be included with the use of one of these ‘high-end’ credit cards, like admission to a rewards’ programs, no fee for currency conversion, and an interest free introductory period.
- Other features which are also commonly included are complimentary travel insurance, personal shoppers and travel agents on call. Good use of these features could save you time and money.
Consider carefully the costs vs the benefits. A good credit for you will reward you more than its costs you. If you don’t have need or want for the benefits on offer, the annual high might not be worth it.
Ultimately, choosing the right credit card for travel means understanding your money personality and choosing a card that suits your budget, your lifestyle, your travel plans, and your spending style. Compare the features available and ask yourself how the card you are looking at would benefit you.
Frequently asked questions about travel credit cards
What is a currency conversion fee?
A currency conversion fee (sometimes called a foreign or international transaction fee) is a fee that is normally charged by your bank when you spend money in a foreign currency. Every time you make a transaction in a foreign country with your Australian issued credit card, the amount you spend needs to be converted to the local currency in order for the payment to be processed. Banks charge a fee for this, usually around 2 or 3 percent, every single time you transact.
Overtime, this charge can add up, especially if you are using your credit card as your main source of spending money and make frequent payments for things like hotels, restaurants and buying train tickets.
Credit cards that do not charge a fee for currency conversion are very popular with travellers. Bare in mind that while some cards will advertise ‘no currency conversion fee’ as their main selling-point, this feature may be available on other cards, also.Back to top