Many credit cards carry big charges for overseas use, landing you with hefty bills when you get back home.
For example, at 2.99%, ‘foreign load fees’ add £2.99 onto every £100 you spend on some credit cards.
Others charge fees when you use your card to withdraw cash from a foreign ATM, which means you’ll pay around 2.99% of the amount you withdraw as well as the load fee – so that’s potentially £5.98 on every £100.
On top of that, if you withdraw cash, you’ll be charged interest on it from the second it comes out of the machine, even if you clear the balance in full that month. And the interest rate charged will often be a lot higher at around 27% (APR) because it’s what’s known as a ‘cash advance’.
So it’s clear: use the wrong card on holiday and you could end up paying fees left, right and centre. Use the right card, however, and you won’t pay a penny more than you have to.
So what are the best cards for overseas spending?
1. Halifax Clarity Credit Card
You can use the Halifax Clarity Card anywhere in the world and you won’t be charged a fee – even if you use it to withdraw cash from an ATM. That’s no foreign load fees and no cash machine charges.
However, while there are no fees from Halifax for ATM withdrawals, you should still watch out for any fee from the ATM operator. And remember you’ll be charged interest from the minute you take the cash out – at a rate of 18.95% pa (variable). The card has a representative rate of 18.9% APR (variable).
Representative example: If you spend £1,200 at a purchase interest rate of 18.95% pa (variable) your representative rate will be 18.9% APR (variable).
2. Post Office Platinum Credit Card
Not only does the Post Office Platinum Card charge no fees when you use it abroad, there’s also no fee to pay if you use it to buy your travel money through the Post Office.
It’s best not to withdraw cash from an ATM with this card, though, as it charges a cash advance fee of 2.5% or £3, whichever is higher, plus interest at 27.9% pa (variable).
However, it's a useful card if you’re also looking to transfer a balance from another credit card, because it charges no interest on balance transfers for 22 months and has no transfer fee.
Balance transfers must be carried out within the first three months, and if you don't clear your debt within the 22 month 0% window, you'll pay 17.8% pa (variable). The card has a representative rate of 17.8% APR (variable).
You will need to earn at least £8,000 a year to qualify for this card.
Representative example: If you spend £1,200 at a purchase interest rate of 17.8% pa (variable) your representative rate will be 17.8% APR (variable).
3. Nationwide Building Society Select Card
If your main current account is with Nationwide (that’s FlexAccount, FlexOne, FlexDirect or FlexPlus), you can apply for its Select Credit Card.
This is another card that does away with foreign load fees. But watch out for the 2.5% (min £3) charge on cash withdrawals, which you'll also be charged interest on at a rate of 27.9% pa (variable) from the second you take the cash out.
On the plus side, the card charges no interest on purchases or balance transfers for 12 months. There's no balance transfer fee, so long as you transfer your balance within the first three months (otherwise the fee rises to 2.4%). When the interest-free period ends, the card charges 15.9% pa (variable).
Representative example: If you spend £1,200 at a purchase interest rate of 15.9% pa (variable) your representative rate will be 15.9% APR (variable).
4. MBNA Everyday Plus American Express card
The MBNA Everyday Plus American Express credit card won't charge you for spending on it abroad or for making cash withdrawals.
What's more, if you can't or don't clear your balance each month, the card charges a fairly low rate of 7.4% pa (variable). Just remember you will be charged this immediately if you withdraw cash on the card.
Representative example: If you spend £1,200 at a purchase interest rate of 7.4% pa (variable) your representative rate will be 7.4% APR (variable).
5. Travelex Supercard
Following a successful pilot last year, the Travelex Supercard launched on June 14, 2016.
The card works by linking directly to your existing credit or debit card via a dedicated smartphone app, and doesn’t require pre-loading with cash. There are no registration, application, administration or usage fees for spending overseas, and your debit or credit card is charged in pounds at that day's Mastercard exchange rate whenever you use it.
However, unlike the pilot, the card now charges 2.99% for cash withdrawals. But if do use it at an ATM, it’s charged to a credit card as spending, not a cash withdrawal, so you don’t get charged interest at expensive cash advance rates.
All credit cards are subject to status and terms and conditions. Over 18s, UK residents only. Terms and conditions apply. See MoneySuperMarket.com for further information.
Please note: any rates or deals mentioned in this article were available at the time of writing. Click on a highlighted product and apply direct.