Travel Money: convenient cards carry a sting for the unwary

When it comes to travel money, pre-paid currency cards are not always a good deal. Used carefully, they can be fine, but there are still hidden risks. The situation in the UK is a good example.

The sorry tale of currency cards in the UK

Not all cards are the same, of course, but the patterns are similar. Typically, a pre-loaded foreign currency debit card in the UK will

  • have poor rates of exchange and
  • charge a commission for the purchase of foreign currency and a fee to convert it back

While it’s true that terms and conditions do explain these charges, many customers don’t read them in detail, so they’re caught out.

Additionally, when they get home many travelers forget to convert back their foreign currency to GBP. A recent article in Travel Daily Media* reports that by June 2023 there was £582m surplus of unconverted foreign currency on pre-paid travel cards in the UK – an increase of 33% compared to 2022.

About 7.5 million people (over 11% of the population) in the UK have a prepaid currency card, but only 9% use all the travel money they have purchased. The rest sits idle.

Beware old favourites

The UK Post Office is a trusted institution and has a good reputation for travel insurance, where it remains competitive with good products.

Yet its pre-paid Travel Money Card is typically less competitive on exchange rates than alternatives, plus it charges 3% for currencies outside the standard list offered and a 1.5% fee for travellers topping up their card in GBP. Plus, there’s a £2 per month charge if the card hasn’t been used for a year!

How is this relevant to the USA?

Extra fees hidden in the small print are a worldwide phenomenon, so the answer is to read the terms and conditions before you commit.

But it’s also worth considering alternatives. Some cards can be used worldwide with real time exchange rates. But check very carefully the source of the exchange rates, as banks will naturally seek to gain an advantage.

The wise traveler will probably take a mix of cards and cash.

Why use cash for travel money?

Cash in your pocket has several advantages. It’s convenient, it’s widely accepted (sometimes, only cash will do) and it’s perfect for small purchases and tips. There’s a security benefit too – lost or stolen cash is upsetting and inconvenient. But a lost or stolen card can be disastrous.

For travel cash it’s worth choosing the right source, as exchange rates and fees will vary between providers here as well.  Credit Unions are often a good bet. As not-for-profits their focus is on value for the customer, so their rates should be fair.

Many will also be using streamlined packages like Money 4 Travel.  This is an efficient and cost effective service that brings benefits to all parties. Currency can be booked online and collected from your local or other convenient branch. Exchange rates are competitive and transparent.

Cash is convenient, low risk and, if you come home with a surplus, it’s easily converted back. What’s not to like?

To find out more about Money 4 Travel, watch this video and go to

*Kanchan Nath, Travel Daily Media, 1st June 2023

This site is better experienced portrait - please rotate your phone