Best credit cards to use abroad

Making payments abroad

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The best credit card to use abroad is one that will save you a small fortune on fees and may include perks like commission-free purchases abroad, cashback on spending, and lower interest rates.

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Easy, secure and greater protection than cash

A credit card can be a very useful thing to have in your purse or wallet while you’re away. It can be handy for spending – and if it is lost or stolen, you can cancel the card immediately and organise a replacement.

Protection is also provided on your purchases. If you spend more than £100 but less than £30,000 on your credit card and something goes wrong or isn’t as described then you can apply to your lender for a full refund. 

However, there are a few traps to be wary of when using a credit card abroad.

The most popular type of credit card for people aged 18-25 is credit builder

Data collected by MoneySuperMarket between February 2018 and February 2019, accurate as of April 2019

Watch out for fees

With most cards, you’ll be charged a fee every time you use your card while you’re abroad.

Confusingly, this fee can be labelled in different ways by different card issuers, including foreign purchase, conversion or exchange rate fee, as well as a loading fee.

Some cards will charge you up to 3% every time you use them in shops, restaurants or anywhere to make a purchase. So, for example, if you stay in a hotel and the bill comes to the equivalent of £300, the card company could add £9.

The cards designed for foreign usage do not charge – compare a variety of credit cards before applying and check the terms and conditions for details on fees on overseas spending.

Don’t get charged for withdrawing cash

If you’re getting money out while you’re on holiday then it’s best to use a specialist credit or debit card to minimise any fees as some cards will charge on average 2.5% of the value every time you withdraw cash. In other words, withdraw £100 and the transaction will cost £2.50.

Remember, you’ll need to pay off the balance IN FULL before the end of the month, or you’ll pay interest.

If you take money out of an ATM using a normal credit card, you’ll start racking up interest immediately, from the point of withdrawal. There is no interest free grace period as with conventional purchases.

The average annual income for credit builder credit card applicants is £10-20k

Data collected by MoneySuperMarket between February 2018 and February 2019, accurate as of April 2019

Avoid buying travel money with your credit card

Credit card firms see buying currency as taking out cash so you may get charged a cash withdrawal fee, or even a fee for using a credit card by the money changer.

If you’re buying currency always use a debit card (you’ll usually need to bring ID too), or withdraw cash.

Never pay in sterling

When you’re using your card abroad you will be asked if you want the transaction to be in pounds or the local currency.

If you’re buying currency always use a debit card (you’ll usually need to bring ID too) or withdraw cash.

As a general rule, never pay in pounds as you could be charged by the bank/store for doing the conversion.

What are the pros of an overseas credit card?

Some advantages of overseas spending cards include:

  • No foreign transaction fees: Travel credit cards are designed to be used abroad, which means you won’t have to pay foreign transaction fees
  • Good exchange rates: Travel credit card exchange rates are generally pretty competitive
  • Rewards when you spend: Some travel credit cards will offer rewards like cashback, travel rewards and vouchers when you spend worldwide
  • Cash withdrawals: Some travel credit cards might let you withdraw cash from a cash machine abroad without charging you a fee. However, the ATM you use may still charge fees, and more importantly you’ll still be charged interest on cash withdrawals even if you clear your balance each month. It’s still best to avoid cash withdrawals on your credit card

What are the cons of an overseas spending card?

Some disadvantages of overseas spending cards include:

  • High interest rates: Travel credit cards often have high interest rates, which means if you don’t pay the balance off in full each month, you might end up cancelling out the exchange rate benefits
  • Not everyone is guaranteed to be accepted: You might need to earn a certain amount of money or have a good credit score to be accepted for a travel credit card
  • Monthly or annual fee: Because some overseas spending cards come with rewards and benefits, you might have to pay a monthly or annual fee to use the card
  • Check your credit card payment network will be accepted: Some countries you’re planning on travelling to might not accept payments with a Visa or MasterCard. It’s always a good idea to check that your travel card payment network will be accepted in the country you’re going to before you leave

It’s important to remember that the benefits and terms and conditions offered by overseas spending cards can be different, so you should always read the product details fully before applying.

Finding the right credit card

Eligibility Checker allows you to find out the likelihood of your being accepted for a credit card when comparing your options. Importantly, it doesn’t leave a footprint on your credit file.

Eligibility Checker can also provide ‘pre-approval’ on certain credit cards. This means you’re guaranteed to be accepted for the card you have applied for, providing you pass additional identity and fraud checks.

The most popular type of credit card for people earning 10k or more is balance transfer

Data collected by MoneySuperMarket between February 2018 and February 2019, accurate as of April 2019

Alternatives for spending abroad 

Prepaid currency cards: Top up the card with your chosen currency and then spend money when you’re abroad. These are a good option if you have a poor credit score and can’t get one of the top credit cards for overseas spending.

Watch out for fees, though, as some firms will charge you for topping up, spending and withdrawing cash.

Debit cards: While most debit cards will sting you for overseas spending there are a couple that don’t charge any fees for withdrawing cash.

Getting cash before you go: Our travel money and foreign currency comparison page can help you find the most competitive exchange rates on the market. 

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