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Money and Banking Options Abroad

various international currencies including the pound, the U.S. dollar, and the Canadian dollar

Photo via John McArthur/Unsplash

Make sure you research the local economy and your options for cash, credit, and mobile payments before you travel abroad.

Cash, Credit, and Banking Tips for International Travel

Planning your financial needs ahead of time is important, as unexpected issues can be daunting and stressful in a foreign economy. Can you get by with a debit or credit card? Or is it a cash-based economy? Make sure you research the local economy, costs, and options for cash, credit, and mobile payment apps. The following guidelines provide a useful base for your research.

Before You Leave

Research the Cost of Living, Exchange Rates, and Payment Methods

To help you plan your budget, research the cost of living—common things like food, housing, and transportation—and exchange rates. Exchange rates vary country-to-country and currency-to-currency. Websites likes provide real-time currency converters to help you plan your budget and expenses.

Next, find out what payment methods are available. Are your credit or debit cards, or contactless payment methods, accepted in your destination?

Order or Exchange Currency

If cash is the preferred payment method, order some local currency ahead of time and find out if you'll have safe and reliable access to ATMs. The most inexpensive way to exchange currency is usually with your bank, either online or at a bank branch location. AAA members can also order foreign currency online or in person at a local branch. While airport currency exchange kiosks may be convenient, they rarely offer favorable rates. Before you leave, order enough of your destination's currency to cover initial expenses like food and transportation upon arrival.

Notify Your Bank

Many banks freeze credit and debit cards if they suspect fraudulent activity. To prevent this, notify your bank and credit card companies of your travel dates and destinations before you leave.

Consider a Travel-Friendly Credit Card

Depending on the length of your trip and how frequently you travel abroad, you may want to sign up for a travel credit card. These cards typically don't charge foreign transaction fees. Also, using a credit card to make purchases abroad gives you a more favorable exchange rate than other payment options.

Have a Backup Plan

Make photocopies of the front and back of your cards, and store them in a safe place in case of loss or theft. Bring a backup credit or debit card so you can still access funds if your primary card is lost, canceled, or stolen. You could also store your bank's customer service number in your phone in case you need to call them.

"Have at least two credit/debit cards abroad. One of my card accounts was frozen, and I would have been in trouble if I hadn't had a backup."

– Harvard undergraduate student

While Abroad

Be Aware of Fees

When using a debit or credit card abroad, two types of transaction fees generally apply: an international ATM fee and a foreign transaction fee. The ATM fee (typically $2-5) is charged for the privilege of using an ATM that doesn't belong to your primary bank. The foreign transaction fee covers the currency conversion cost and is a percentage (typically 1-3 percent) of the total amount you withdraw or pay when making a purchase.

Withdraw Wisely

Wherever possible, use ATM's located inside of a bank branch or opt for machines in well-lit, well-traveled areas. You can search ahead of time where the nearest MasterCard ATMs and Visa ATMs are located. Both in the U.S. and abroad, criminals are known to attach fake credit card readers to ATMs; unfortunately, they look similar to the real thing and capture your bank information. Be mindful of anything suspicious attached to the machine. If you're traveling in an area where theft and petty crime are common, limit your withdrawal amount and consider storing your cash in multiple places so you have a reserve if your wallet is stolen.

Consider Cash and Credit Alternatives

Contactless payment options like Apple Pay and Samsung Pay are easy and convenient payment methods in certain geographies. The technology is prevalent in parts of Asia-Pacific, Europe, and South America, but you can't rely on it everywhere just yet. Also, contactless payment limits vary by country and retailer, and purchases above a certain amount may require a PIN.

Peer-to-peer payment applications like Google Wallet, Square Cash, Venmo, and Paypal make sending money quick and easy in the U.S. They also limit your need to carry cash. You only need Wi-Fi or a data network. Currently, Venmo and Square Cash can only be used to accept and make payments in the U.S., whereas Google Wallet can handle U.S. and U.K. currencies. Paypal, however, is available in more than 200 markets and supports several currencies. For region and country-specific options, Verse is popular across European markets; Paytm is one of the largest in India; AliPay and TenPay dominate China; FlickPay is prevalent in South Africa, and RecargaPay is big in Brazil.

Some underdeveloped nations lack the infrastructure for reliable, easy-to-access ATMs. If you're traveling to such a destination, research and plan how you'll acquire funds necessary for your travel. Potential options include:

  • Transfer money electronically via Western Union or TransferWise
  • Order or exchange cash prior to your trip (keeping in mind that carrying a lot of cash is not ideal)
  • Use U.S. dollars, which are accepted in select countries and territories

Harvard Global Support Services does not endorse any of the external organizations or services; they are provided only to serve as informational aides.