Pre-load your plastic and lock in a decent rate
CURRENCY cards let you pre-load currency, which means you lock in the rate you pay. Your money is also protected if the provider goes bust.
But it is important to check the small print as some card issuers will charge you to load money, while others will apply an ‘inactivity charge’ in months you do not use the card. The exchange rates on offer are also not always competitive. If you are happy to manage the money on your currency card through an app on your mobile phone then the Monzo card is a sound choice with no charge applied to spending. Locking in a rate now is great if the pound falls further, but the risk is that the exchange rate improves and you miss out. Websites such as FairFx can let you set up an alert to inform you if the exchange rate reaches a predetermined level.
While it is free to use your debit card at home, most banks will charge you for flashing the plastic while abroad.
Some banks charge a flat fee for each purchase, often as high as £2.50 a time, while others will charge a percentage of the value of the transaction, as much as 3 per cent. For withdrawing cash, banks will typically charge a percentage of the amount you withdraw, with a minimum fee of £3 for each visit to a foreign cash machine. If you do want to pay with plastic then using a credit card can get you a better deal.
For example, the Halifax Clarity card does not impose overseas transaction fees. But it applies interest of 18.9 per cent to any card balances not cleared promptly. Post Office Platinum, Royal Bank of Scotland (Reward Black) and Santander (All in One) also do not apply foreign usage fees.