Paying by card overseas can be costly – unless you’ve got the right one
Using your normal bank card on holiday might feel convenient, but it can quietly eat into your spending money. Most UK cards apply a foreign transaction fee (often called a non-sterling transaction fee) of around 3% every time you spend in another currency although many may charge even more.
That means if you buy £100 worth of goods abroad, you’ll actually be charged about £103 once the fee is added. Some debit cards go further, tacking on a flat charge (typically 50p–£1.50 per purchase) no matter how small the transaction.
Withdrawing cash will also typically incur fees – and in the case of credit cards, you’ll usually be hit with interest from the moment you take the money out.
The result: the convenience of using your everyday card can come with a hefty holiday surcharge.
The fix: specialist travel cards
Luckily, there are plenty of travel-friendly debit and credit cards that don’t charge any foreign transaction fees. These cards give you access to the same near-perfect exchange rates that banks themselves use — typically the Mastercard or Visa rate, which is usually within a fraction of the real interbank rate.
In plain English: £100 spent abroad should cost you pretty much £100.
The message is simple: get a specialist card before you go, and use it for everything abroad.
Check if your current card adds fees
Don’t just assume your card’s fine — most aren’t. Log into your banking app or check your provider’s website to see whether it charges:
- A foreign transaction fee (usually 2.75%–3%)
- A flat spending fee per transaction
- Cash withdrawal fees abroad
If it does, it’s worth switching to one that doesn’t.
Top travel credit and debit cards
The best travel cards have:
✅ No exchange rate fees when you spend abroad
✅ No ATM fees (or low ones)
✅ Interest-free periods on overseas withdrawals if repaid in full
They’re typically Mastercard or Visa cards – the rates between the two are usually very close, though Visa can be a touch better in some currencies.
Other good ways to spend abroad
If you’d rather not open a new bank or credit card, there are still a few smart options:
Prepaid travel cards
Load money in advance and spend in local currency. You can lock in the exchange rate before you travel, so you’ll know exactly what you’re getting. Some add sneaky fees, but options like Wise and Revolut usually offer strong rates and minimal costs.
They don’t expire, but many providers charge inactivity or delivery fees, so always check the fine print.
Cash
Still useful for tips, markets, and small vendors. Use an online travel money comparison tool to find the best exchange rate before you buy — airport kiosks almost always have the worst rates.
Bottom line
The best way to pay abroad is simple:
- Get a specialist travel card with no foreign fees.
- Use it for spending and ATM withdrawals instead of your regular bank card.
- Avoid currency conversion offers at the till (always pay in the local currency).
A few minutes of prep can save you a lot — often enough for an extra dinner, excursion, or even a night’s stay.
Holiday Nerd 