Travel Insurance

Should You Pay For Your Holiday With A Travel Money Card?

9 October 2015

Let’s take a look at what makes travel money cards great – and not so great – and how best to put them to use on your overseas holiday.

Smart travellers know you should always have a few ways to pay when adventuring overseas. One of the options open to Australian’s heading abroad are travel money cards.  Travel money cards are a convenient and safe way to buy foreign currency to spend overseas. They’re offered by the major banks, airlines like Qantas, money exchange companies like Travelex and even Australia Post. Travel money cards let you spend your own money which you’ve paid a fee to pre-load onto the card in Australia or online.

You can stash multiple foreign currencies onto the card at a time, allowing you to spend like a local once you’re overseas, thus avoiding currency conversion fees typically charged by credit and debit card providers.

As with all payment options overseas, travel money cards have their pros and cons. Here we take a look at their benefits and drawbacks. LIKE A CREDIT CARD Travel money cards are easy to use in store or at the ATM. When you want to use your travel money card to make a purchase or withdrawal, press ‘credit’ when you want to complete the transaction.

LOCK IN EXCHANGE RATE If the Aussie dollar is currently strong, a travel money card can be clever way to secure a favourable exchange rate before you jet off. This works best if you’re watching the exchange rates ahead of time and taking note of the trends.

MULTIPLE CURRENCIES Travel money cards are excellent multi-taskers. If you’re touring South East Asia or South America, or are booked on a round the world ticket, keep the currency you need on hand by pre-loading your card with multiple currencies. Money card providers allow you to load from 5 to 13 currencies including US Dollar, New Zealand Dollar, UK Pound, Indonesian Rupiah, The Euro,Thai Baht and South African Rand. Don’t forget about loading currency for stopovers in Singapore and Bangkok too.

BUDGET CERTAINTY Travel money cards help you stick to your travel budget by allocating spending money up front. Most providers allow you to check your balance online to keep track. If you get home to Australia with money left in your card, you can use it like a regular debit card to empty the account at an ATM or use it to make a payment. Fees to apply however.

SECURITY Carrying cash on your holiday is risky – it’s easy to lose, and easy to steal. While you’ll always need to carry a small amount to cater for places where cash is the only accepted payment method, for most transactions a travel money card will do the trick. Pre-paid travel money cards work like regular credit or debit cards with PIN security. The best part is they’re not linked to your bank, so if they should walkabout you’re not emptying out your entire life’s savings. As with bank cards, a travel money card can be blocked should it end up stolen.

BACK UP CARD Another travel money card perk is that most providers issue you with two linked travel money cards. This means you can stow the second card away as a back up should you accidentally lose card number one 

RELOAD ONLINE Travel money cards are typically linked to an online banking-type environment where you can login to manage your account. From here you can reload money onto your card, check your balance and change the currencies around if you your travel plans have changed.

Pre-loaded travel money cards are safe and convenient but they don’t offer the greatest of exchange rates, along with pesky fees and charges that come with opening and reloading your money card overseas.

OPENING AND TOP UP FEES There’s no such thing as a free lunch, and the same goes for travel money cards. To get started, providers will charge you an initial card fee to load the card. This will be either a percentage of the total that you’re loading, or a flat fee. You could also get charged each type you reload your card.

EXCHANGE RATES It’s worth having a look at the exchange rates offered through travel card products. Travel card providers often offer a different – usually higher – exchange rate for travel cards.

ATM FEES Using your travel money card to withdraw cash at an overseas ATM attracts a fee, along with the usage fee charged by the local ATM owner. While the fees should be cheaper than what you’d be faced with if you withdrew cash with your regular debit card, and certainly your credit card, it’s still worth keeping in mind that ATM withdrawals cost you money.

WRONG CURRENCY FEE If your travelling to multiple countries the idea is that you load money in each of the currencies you’ll need and that you only spend what you have in each currency. If you’ve missed a detail – like forgot to load money for your Dubai stopover to London – you can pay in a currency other than what’s loaded on your card, but you’ll be charged a conversion fee for the privilege. This currency conversion fee can be as high (if not higher) than a credit card currency conversion fee.

RELOAD TIMES Typically, travel money card providers use BPAY for reloads, unless the card is connected to a bank savings account. The problem with BPAY is  transactions can take up to three business days to process, and up to six days for the funds to clear in your account when you factor in Australian public holidays and weekends. Remember to factor in a delay when you’re reloading.

INACTIVITY FEE Some travel money cards are the jealous type, punishing you should you forget to give it regular attention. This is done through an inactivity fee, which eats away at your balance if you’ve neglected to use your card for a specific period of time.

CARD EXPIRY In the case that your card expires with money on it, some  – but not all – providers will keep the balance.

CLOSING YOUR CARD Once back on home soil, you may want to convert excess currency into Aussie dollars and close the travel card account. To do this you will pay the normal currency transaction charges but you may also pay up to $10 to close the account.


Travel money cards are handy, but the convenience comes at a price. While there are more cost effective ways to travel with money overseas there are times when a travel money card makes a sound travel partner:

  • Globetrotting: If you’re travelling to lots of countries on the one trip a travel money card can offer you the safety and convenience of having multiple currencies locked and loaded. If this is you, find a card that will allow you to load the currencies of the places you plan to visit. The big banks support the widest variety of currencies. Convenience and securing a good exchange rate are the benefits here.
  • Big purchases: Choice Magazine‘s Travel Money Guide advises that “pre-paid travel money cards may not do you much good if you spend less than about $3000 overseas, since the fees you’ll pay for having and using the card will likely outweigh any overseas ATM or transaction costs you’d incur if you used your regular bank-issued debit or credit card.
  • Reward programs: Some travel cards reward your eligible spending with frequent flyer points such as the Qantas Cash Travel Card. With linked travel money card in hand, points junkies can add to their stockpile if they’re smart with how they use their card.

This article is for your general information only and is not financial advice. It does not take into account your personal circumstances, and you should obtain independent advice.

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