Best credit and debit cards for travel

julia kukiewicz
By Julia Kukiewicz

credit card for travel

Getting ready to go away on your travels? You'll need one of the best credit cards for travel.

Like teenagers on a school trip, most debit and credit cards become very different beasts as soon as they step outside the UK.

The credit card that rewards you so kindly on its home turf - by allowing you to pay off purchases interest free, for example - might charge a fee of at least 2.75% on every purchase abroad without any rewards for your trouble.

An everyday debit card could be even worse: some charge up to £1.50 on every purchase.

ATM withdrawals are also expensive.

As in the UK, most credit cards charge for cash withdrawals and the transactions accrue interest at a much higher rate than purchases. Unlike the UK, though, debit cards are at it too and usually charge a fee of around 3%.

Such shenanigans mean that, for most of us, a decent credit or debit card for travel is as much a holiday essential as a bottle of a sunscreen and a raffia donkey.

The best cards for travel

However, like the perfect sunscreen, finding the perfect credit card for travel takes some deliberation if you want to avoid getting burnt.

Annoyingly, there are few, if any, cards that can cover all your normal transactions abroad at the cheapest rates and offer travel extras such as insurance to boot.

Some do a fair job of multitasking but we've set out the cards available in groups to reflect the fact that it's a good idea to work out the main benefit you're looking for - whether it's 0% commission on use abroad (see the more on this here) or free travel insurance - and look for that first.

Skip ahead to find some of the currently available deals for:

It's also worth noting that, while the best debit and credit cards for travel are generally always the cheapest option for use abroad, prepaid travel cards may be easier to get hold of in a hurry. Click through for our guide to prepaid travel.

Good for: purchases on card

There are quite a few credit cards that charge 0% commission on purchases made abroad:

The debit cards above are fee free (worldwide with Norwich & Peterborough and in Europe only with Metro) but to hold them customers will need to meet all of the requirements for holding the accounts, listed in more detail in the next section.

All of the credit cards above are frequently cited as some of the best for travel because they charge 0% commission fees on purchases worldwide.

To see what that actually means, let's look at just one of them in more detail:

Post Office Money Platinum credit card (Go to provider »)
post office money platinum
  • No fees on overseas purchases
  • 0% interest on balance transfers for 18 months, 2.89% balance transfer fee applies (made within 3 months of account opening)
  • 0% on purchases for the first 28 months
Representative example: When you spend £1,200 at a purchase rate of 18.9% p.a. (variable), your representative APR will be 18.9% APR (variable).
Post Office Credit Cards are provided by Bank of Ireland UK. Post Office Limited is a credit broker and not a lender.

The Post Office credit card is a good example of how 0% commission (that is no non sterling transaction fee) doesn't necessarily mean good rates abroad across the board.

For example, cash advances are a bit of a blind spot. As in the UK, cash advances abroad are currently subject to a 26.9% p.a. variable interest rate, plus a 2.5% fee and with no interest free period, so they're best avoided altogether.

And, as of November 2010, it's not possible to 'preload' the card balance and get around cash advance fees that way.

It's worth nothing that there is another option for 0% fees on use abroad, not listed above because it's a bit of an oddball:

With Nationwide credit cards, other than Select, customers must earn their 0% use abroad.

For every £5 spent on the credit card in the UK, cardholders earn £1 to spend with 0% fees abroad. The travel spending balance is shown on the account statement but is well worth taking note of before travelling: any purchases made abroad over the 'earned balance' will be charged a 2% fee.

All in all though, while Nationwide used to offer one of the better deals for use abroad there are now much better alternatives.

Good for: ATM withdrawals

Some current options:

These are currently the ones to watch for cash withdrawals abroad.

The Norwich & Peterborough and Cumberland Building Society current accounts offer straightforward no fees abroad debit cards, the simplest to understand.

As of March 18th 2014, Metro will only offer free use abroad in European countries, the full list is here.

However, current account holders will need to meet the requirements of the accounts to take advantage of these rates. Norwich & Peterborough Gold Classic current account holders must pay £500 into the account every month or hold a £5,000 balance to avoid a £5 monthly fee, for example.

Metro, N&P and Cumberland all also have a limited number of branches.

The credit cards, as is their nature, are a little more complex.

Halifax Clarity makes the cut because it doesn't charge a fee for cash advances and, although interest is charged whether the balance is repaid in full or not it's currently at a fairly low rate (see the link above for the exact current rate).

Let's look at Saga's credit card in more detail.

Not only does Saga's Platinum credit card offer a 0% rate on non sterling transactions but cash withdrawals have the same standard interest free period as purchases (i.e. it's possible to pay off the whole balance interest free).

The downside is that there's still a fee (2% of the cash advance amount, minimum £2) but without interest when you pay off in full it still beats most other credit cards.

Note also that the Saga Platinum credit card is only available to those aged fifty and over so if you haven't quite reached your third age you'll have to look elsewhere.

Good for: Travel extras

Some current options:

Travel insurance sold alongside debit and credit cards has a bad name and for a good reason: cardholders often assume that they're covered when they're not and end up losing out if they haven't taken extra insurance to cover themselves.

One reason for this is that policies are actually travel accident insurance (explained here) which is not the same as full travel insurance.

Even when they are full insurance, policies may have exclusions which will make it unsuitable for some people. Always be careful to check insurance policies in full before assuming that you're covered.

Having given that warning, however, we should note that the policies above are, actually, offering a rather good amount of cover.

Let's run through the various benefits available.

FlexAccount: Nationwide's multi trip European travel insurance is for their Flexaccount customers who are 73 or under and pay at least £750 into the account every month.

It's a pretty standard policy with a low excess of £50. Note that Europe is pretty broadly defined (it includes the Canary Islands, Syria, Turkey, Iceland, Azores, Tunisia, Egypt, Israel and all countries bordering the Mediterranean Sea) and account holders can upgrade to worldwide cover, cover a family or cover winter sports for an additional premium, although we found it was often more expensive than the cheapest standalone policy for those categories.

FlexPlus: Nationwide's packaged account offers Worldwide insurance but the £10 monthly fee means that, if this is the only feature of the account used, account holders are effectively paying £120 for an annual policy.

When we looked, similar policies were available for less elsewhere.

The account also offers other insurance products - breakdown cover, for example - but, as always with all insurance products and other features offered with packaged accounts, its worth checking whether this will be suitable or applicable before buying.

Barclays: holders of the Barclays Bank Basic Bank Account can add the following features to get travel insurance:

Both of these travel insurance policies cover the account holder and their immediate family.

Again, as with any packaged account, the monthly fee is only ever worthwhile if the included benefits are actually used and even then similar standalone insurance products may be available for less elsewhere.


6 September 2014

Saga service sucks! Over the last 2 years they consistently fail to send printed statements out and then stop them and don't inform you. They will not use emails even to advise customers or follow up reported poor service. Closing the account today.