Are there any drawbacks to "travel money cards"?
The cards I'm asking about are sometimes called "travel cards" or "prepaid cards" or "forex cards". I don't know if there is one universally accepted name.
I have never used one because I believe they are not suited to my style of travel, but maybe I'm wrong about that.
I believe you pre-load them with amounts of money in one or several foreign currencies.
I believe that many banks in many countries provide them but that places other thanks banks sometimes also provide them.
I cannot find the Wikipedia page or even decide what is the most usual term. But here is the link for the card of this type that my bank here in Australia provides, as one example for those who need more info about what I'm talking about. And here is a Quora question about them where I learned they are also called "forex cards", which I have used as a new tag since "travel card" is obviously ambiguous.
My actual question about them is:
When are these cards not suitable for travellers? Do they have any down sides?
Best Answer
When are these cards not suitable for travellers? Do they have any down sides?
To begin, the same downsides that happen if you use a prepaid card in your own town instead of your regular card.
- You have to carry an additional card in your wallet, and you have to remember to use the right card in the right place. (Many apps like Uber make it slightly cumbersome to switch cards, usually exactly when you're already running late.)
- You have to load the card with the right amount of credit prior to use, and remember to keep it appropriately topped up. (It's not a cool look to fail to pay the restaurant bill and then spend ten minutes fiddling with your phone in an area with no cell coverage trying to move some money between accounts.)
- It's not always possible to move the unspent quantum back to your regular account.
- Hotels and car companies often place large holds on cards. For a credit card (or a debit card backed by a current account) that is irrelevant. For a prepaid card that can mean finding quite a bit of collateral and tying it up on the card.
- Reduced or non-existent consumer protection: usually no chargebacks.
- Absence of points or reward schemes. That hotel bill can earn a lot of cashback!
For me this is already a huge downside over just using one of my regular credit cards.
In addition, for these prepaid travel cards,
- Some cards require the currency to be fixed in advance, or are fixed by physical card.
- The exchange rate is usually quite bad compared to the market spot rate. Availability of good cards differs, but in the US and UK you can obtain credit cards that match the Mastercard or Visa network rates.
To me it offers no advantages at all and I wouldn't consider using one.
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What is the disadvantage of a travel money card?
Fees. You will incur some fees when using a travel money card, however just how much you'll have to spend varies. Some cards will only charge a once-off transfer fee, while others will charge more. Make sure you read all the terms before choosing a card.What is the best form of money to travel with?
Credit and debit cards A credit card may be the best way to travel with money, provided you have the right one. For one thing, using a credit card instead of a debit card protects your bank balance from theft.What is the advantage of a travel money card?
Why use a prepaid travel card? It's safer. A prepaid card is similar to having cash on you but it's safer than carrying around too much or leaving it in your hotel even if it's in the room safe. This is the main advantage of carrying one of these cards as your money is safe if the card is lost or stolen.Is a travel card a good idea?
Increased Earnings. One of the most compelling reasons to choose a travel card\u2014even with an annual fee\u2014is they often rack up rewards more quickly than their cash back counterparts.Compare Travel Money Cards (and avoid rip-offs)
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