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By David Stevens Personal Finance Correspondent
Thursday, 31 July 2008 |
Compare Credit Cards for your Holiday
Which are the best credit cards for spending abroad?
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IF you have booked a holiday for the end of August, it may not be too late to compare credit cards that are best suited for using abroad.
Credit card companies are no doubt rubbing their hands in anticipation of all the foreign transactions that will be made by British credit card holders in bars, restaurants and shops abroad over the next two months.
With an average foreign currency transaction fee hovering just below 3%, and an estimated £22bn to be spent over these summer months – much of it abroad - it is not surprising that the banks are happy.
Freely use a credit card abroad
But there are a few credit cards that you can use freely on your travels without making your post holiday blues any worse when the credit card bill comes in.
We have taken the time to compare credit cards for spending abroad, and we discovered that the crown of the travel credit cards belongs to the Post Office, with its Post Office Classic and Post Office Platinum credit cards.
 You can compare credit cards for spending on holiday here.
Post Office Credit Cards
A Post Office Classic credit card, or if you can get it, a Post Office Platinum credit card, is as arguably as important as your passport, sunscreen and Imodium!
Both of these cards do not charge a foreign transaction fee at all, which means you can use them freely in any shop or restaurant abroad without having to pay a percentage of your purchase (or a flat fee as in some cases) to the card company.
Be warned though, you shouldn’t use these cards to withdraw money from an ATM or get any other kind of cash advance (including buying currency at the airport, or your hotel abroad) as the rate is 19.16% alongside a 2% fee.
All purchases made on the card are interest free for 56 days, which is more than long enough to leave until you get back from holiday, after which the interest rate is 15.9% for the Platinum card, or 16.9% for the Post Office Classic.
Its not too late to apply for a Post Office Credit Card for your holiday:
Watch out when you pay
While the Post Office credit cards may not charge you a transaction fee when you pay for your pasta in Pisa or your margarita in Malaga, the sneaky shop owner may try to charge you in Sterling rather than the local currency.
While this may sound both useful and sensible – after all, it lets you know exactly what you are spending - it is in fact an underhanded way for the retailer to make you pay a little extra in form of a dynamic currency conversion.
When asked, be sure to tell them you want the card to be charged in the local currency only, and don’t take any protestations that this is not possible.
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