4 Reasons carrying Cash over Cards makes sense for travellers

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4 Reasons Carrying Cash over Cards Makes More Sense For Travellers

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Do you know the story of the traveller who screamed “Daylight Robbery!” when looking at bank rates for conversion and processing fee on their card transactions abroad? No? Well,it’s long story but to cut short, it’s the story of every traveller abroad ever. There are of course more such interesting stories like the traveller who had to do dishes because they didn’t have cash and cards were just not accepted by the wayside inn in a remote picturesque village.

Simply put, these are not situations you’d like to find yourself in. Card transactions are the norm in most of the places in the world, however, they may prove to be costly when used abroad and may not be an accepted means of payment in certain establishments. Cash payments are always a safe option that could save you a major portion of your travel expense in the form of conversion & processing fees and the sky-high rates that banks levy on card users. Let’s see the important reasons why you should carry cash instead of your debit or credit cards to ease your transactions at the same time saving money!

1. Save up cash wasted on conversion and processing fee

Credit and Debit cards are great in that they have a lot of offers going on for their users like reward points and cashbacks. However, when it comes to their usage in a foreign country, there is much left to be desired. The rates levied are very high and can include conversion fee, processing fee, administrative fee and could easily amount to 4% of your transaction every time. Over the course of your trip, the expenses would add up to be significantly high!

2. Dynamic Currency Conversion fee. A fancy word for “unnecessary bank services”

Dynamic currency conversion (DCC) is a banking solution in which credit card holders when  paying for goods or services in a foreign country, have the transaction cost converted to their home currency, thus letting you know how much you are spending in your currency. Sounds pretty good right? But here is the kicker, you would be charged 3% of your entire transaction amount for the use of this service. This would, of course, be apart from the bad exchange rates of banks you’d get, not to mention the conversion and processing charges. Not a pretty picture now is it? Do yourself a favour and have a mobile app ready that lets you calculate money in your home country currency so you get an idea of your expenditure without having to rely on DCC.

3. Disadvantages of Cards and traveller’s cheque

Apart from the above-mentioned drawbacks, there are few other subtle points to be looked into too. If you are entirely dependent on cards, their theft or loss would leave you crippled. Lengthy bank procedures will have to be initiated to block the card to avoid the risk of its identity theft. If your card gets misused abroad before you can block it, it’ll leave you to sort out a huge mess when you get back home.

Nowadays cards come in two types, magnetic stripe and smart chip varieties. The older magnetic stripe is what is common in the USA and the smart chip enabled card technology is more in use in Europe. This obviously can present problems for travellers in Europe where, only smart chip-enabled cards are accepted at the majority of places, especially in Belgium and the Netherlands. Also, the fees levied for transactions abroad using cards, would eat into your balance and it’d be confusing to keep track of the money spent.

Travellers cheques as an alternative fares worse than cards as they are not very widely accepted and you would find it hard to convert it to the local currency, let alone at a good rate.

4. There are some things that a card can’t buy, for everything else there’s cash

Cards can take you only so far, but when it comes to tipping and using the services of small businesses, restaurants, bars, and hotels, Cash rules the roost! When you are on the road, the chances of doing spontaneous activities like eating at wayside shops or buying a bus, train ticket are best facilitated by cash. So make sure to convert ample cash in the form of local currency before your trip. You’d especially need them during your initial arrival at the destination for booking a cab, having a meal, getting a drink etc. In countries like USA or Canada where tipping is expected for every service performed, it would be better to leave the tip in cash. This would reflect better on you and you’d be treated like the gracious tourist you are.

People are always looking up airfares and hotel deals that they could get for less price to save money during their travels but rarely does one do their homework properly and also check how they can avoid paying unnecessary money like Credit Card Charges, Debit Card Charges, and Airport Exchange Rates which could save them  5-15% of their total travel expense! So before you go abroad make sure to plan your expenditure and accordingly buy foreign currency in advance. Check out the cheap rates offered by extravelmoney.com for buying foreign currencies.

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