4 Advantages of Cash Over Credit and Debit Card When Travelling Abroad

cash vs card for foreign travel

Do you know the story of the traveller who screamed “Daylight Robbery!” Well, it’s the story of every traveller abroad ever who uses credit and debit cards for their transactions. Also, there are stories of travellers who have ended up doing dishes because they didn’t have cash and cards were just not accepted by the wayside inn in a remote picturesque village they went to.

These are not situations you might prefer to be in. Card transactions are the norm in most parts of the world. However, they may prove costly when used abroad and may not be an accepted as a means of payment in some hotels and shops. Cash payments are always a safe option that could save you a major portion of your travel expense in the form of card usage fee abroad, currency conversion charges and unfair exchange rates given by your bank. Let’s take a look at the 4 advantages of cash over credit and debit cards when travelling abroad.

1. Save up money wasted on unfair exchange rates and card usage fee abroad

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 card usage fee abroad levied is very high and there are also other hidden charges like currency conversion fee, processing fee, an administrative fee which 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 – An unnecessary bank service for charging extra money

Dynamic currency conversion (DCC) is a banking solution in which cardholders when paying for goods or services in a foreign country, can convert the transaction cost to their home currency. This is done for the convenience of knowing how much we are spending in our home 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 card 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.

Traveller’s 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 paying at small hotels, restaurants, and bars, 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.

Buy foreign currency online india


Scroll to Top