Charges for using credit cards abroad
I’m a big fan of credit cards used the right way. Pay them off every month and you get around 56 days free credit. Get a zero per cent card and you can get months of interest free purchases. And a credit card of course gives you additional protection, insurance on your purchases and against getting ripped off. All the above can make them especially useful for when you’re away on holiday - much better than travellers’ cheques, and with an automatic receipt courtesy of your credit card bill when you get home. But charges for using credit cards abroad can make things look very different.
There is a BIG coda here - you must check out your terms and conditions before you use your credit card abroad. I know, I know … who does that? We all get used to just whipping the plastic out to pay for stuff. But terms and conditions (and thus charges for using credit cards abroad) vary wildly between different credit card lenders. There is a very useful article on foreign usage credit cards on the Moneyfacts.co.uk site which compares and contrasts the costs and charges for using credit cards abroad.
Differences are dramatic. It’s the little phrase ‘Foreign usage loading’, which is an additional charge levied by your credit card issuer for transactions outside the UK (and it can be up to 2.99% currently). In fact there were only three cards listed at Moneyfacts which didn’t have foreign usage loading when I looked (a Nationwide, a Post Office and an Abbey card). Check this handy table on charges for using credit cards abroad, and don’t return home to a nasty shock.
Read more on zero percent credit cards and low APR credit cards here.
