What is the best card to use while travelling abroad?

Aug 26, 2021

This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.

Editor’s note: This post has been updated with additional information.

As well as earning great rewards to reach your next travel goal, it’s important to stay on top of both costs and rewards while actually travelling.

There are so many different options for both paying for purchases as well as accessing cash while travelling, so what are the best options?

Sign up to receive the daily TPG U.K. newsletter for more credit card information.

The best card to use for travelling in Europe: Virgin Atlantic Reward+ Credit Card UK

(Photo by Josh Gribben for The Points Guy)

While most cards will charge you a foreign transaction fee for purchases in foreign currencies, there is a bright spot. Virgin Money no longer charges this fee for purchases in the European Economic Area, which covers 30 countries from Austria to Sweden.

This means you can use this card (and its no-annual-fee Virgin Atlantic Reward Credit Card version) when you’re in most of mainland Europe and earn points without incurring a fee. Best of all, you’ll earn a generous 1.5 Virgin Atlantic Flying Club miles per £1 or foreign currency equivalent spent.

You’ll still be charged a fee for cash withdrawals using this card whether at home abroad so stick to purchases in the European Economic Area.

This card has a representative APR of 63.9% variable and a purchase rate of 22.9% variable with an assumed credit limit of £1,200.

You can read a full review of this card here.

Related: Should you use a credit card to withdraw cash while travelling?

The best card to avoid fees elsewhere: Starling Bank Debit Card

Paris in the snow Eiffel Tower
Paris in the snow. (Photo by Orbon Alija/Getty Images)

The bad news about this card is that it doesn’t earn any rewards, as it’s a debit card — not a travel card. You’ll also have to load sufficient funds onto the card before you travel.

But the great news is that it has no fees — both for purchases at home and abroad. And, more importantly, for cash withdrawals at home and abroad.

Most travel card issuers either charge for ATM withdrawals in foreign currencies, or at least put a monthly cap on the amount you can withdraw. For some destinations that still largely use cash, this is a hugely valuable benefit for regular travellers.

This feature costs Starling some serious money to offer the benefit for free, so this generous offer may change. But right now, it’s a fantastic way to avoid expensive foreign transaction fees.

You can read a review of the Starling Bank card, as well as some of the other innovative travel debit cards available right now, here.

Related: What is dynamic currency conversion and why should you avoid it?

The best card to earn maximum rewards: HSBC Premier World Elite Mastercard

This card has some tough eligibility criteria — namely the requirements to have an HSBC Premier current banking account, which by itself does not sound onerous, but the requirements for opening this bank account are:

  • A minimum of £50,000 held with HSBC, either in a savings account, or otherwise invested; or
  • A ‘mortgage, investment, life insurance or protection product’ with HSBC and a minimum annual income of £75,000, which is more than twice the U.K. median income.

And there is a 2.99% foreign transaction fee for all purchases made in currencies other than the pound Sterling.

So, why did this card make this list?

Because it offers a very generous 4 HSBC Reward Points per £1 spent in foreign currencies. These points can be converted to several points currencies at a rate of 2 to 1. For example, you could be earning 2 British Airways Avios per £1 spent. TPG U.K. values Avios at 1.2p each, so earning two Avios per £1 spent would be around 2.4p worth for your 2.99% foreign transaction fee (or 3p per £1 spent).

If you wanted to top up a certain point balance by effectively buying points for 1.5p each, this could be a smart way to do it.

Representative rate: 59.3% APR variable and a purchase rate of 18.9% per annum variable with an assumed credit limit of £1,200.

You can read more about this card here.

Featured photo by Cris Tagupa on Unsplash.

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.