Before you go on holiday, you may begin pondering how much money you are likely to need and how best to take it with you. In this article, we outline the best and cheapest ways to withdraw cash abroad, as well as the best and cheapest ways to pay by card without being charged. For a quick summary of the best way to take money abroad check out the below comparison table. Alternatively, you can find out more about the other methods of taking money away on holiday by clicking on the following links:
1 minute summary - The best ways to take money abroad
- Two of the best and cheapest ways to spend money on holiday is with a Starling Bank* or Revolut* card.
- Starling Bank is a UK-licensed app-only bank with full FSCS protection. It allows you to spend abroad on its Mastercard debit card fee-free with no limits on foreign transactions or ATM withdrawals.
- Revolut* is a prepaid Visa card, which can be used to spend abroad and in the UK fee-free. It does have restrictions on fee-free spending abroad and ATM withdrawals but these limits are reduced with its alternate subscription plans.
- Revolut currently has no UK banking licence therefore money is not FSCS protected.
- Revolut's and Starling Bank's currency exchange rates are among the best available but Revolut does add up to 1% mark-up on weekends.
- Opening a Revolut or Starling Bank* account does not affect your credit rating.
The best way to take money abroad
The easiest and potentially cheapest way to take money abroad is via an app-only bank or prepaid card. This is because you can easily have access to your money without having to carry lots of cash around with you. A prepaid card or app-only bank also allows you to spend money and withdraw cash without being charged interest or fees. In addition, a majority of app-only banks and prepaid cards allow you to freeze your card should it get lost or stolen whilst you are away.
In the below comparison table, we compare the key features of prepaid cards and app-only banks to see which is the best for taking your money abroad. If you would prefer to take a credit card abroad with you, you can compare the best travel credit cards here.
One thing to consider before travelling abroad is how much money you are taking with you. With a prepaid card, you can load the exact amount you wish to spend whilst you are away, whereas with an app-only bank you may have access to more, especially if you use the app-only bank as your main bank. This could pose a security risk when travelling, particularly if you happen to be targeted by fraud.
What's the best way to take money on holiday? – a comparison
|Revolut||Starling Bank||Monzo||Chase||Curve||Caxton FX||Travelex|
|Account type||Pre-paid card||App-only bank||App-only bank||App-only bank||Spending card (connect to your existing debit and credit cards)||Pre-paid card||Pre-paid card|
|Free foreign ATM withdrawals||Up to £200 free per month or 5x withdrawals a month (2% fee thereafter)||£250 free every 30 days within EEA or £200 free every 30 days outside EEA (3% fee thereafter)||£200 per month (2% fee thereafter and 50p charge for over 10 cash withdrawals in a month)|
|Free overseas spending||£1,000 per month, 0.5% fee above £1,000||Up to £1,000 every 30 days 2% fee thereafter|
|Instant spending notifications|
Pre-paid travel cards
Pre-paid cards are a fairly new way to take money on holiday. You simply put as much cash as you want on the card before the start of your holiday (or even top up while you are away). Pre-paid travel cards can be used in a similar way to a credit or debit card, and you can even use them to withdraw money from an ATM (using a pin that is sent out once you set up the card).
Most cards will allow you to check the card balance and add or withdraw funds, either by phone or over the internet. The charges on these cards vary by provider, so you will need to check the terms and conditions. At present, most prepaid cards are only available in the main world currencies, but as their usage increases, more currencies will inevitability become available.
Be aware, however, if you use a pre-paid card when checking into a hotel or hiring a car, the provider may ‘ring fence' an amount on your card to protect themselves against future charges for services used or damage incurred. Typically a hotel will ‘ring fence' around £250, whilst a hire car firm could ‘ring fence' as much as £1,000. This amount will not be physically taken from your card but it will mean you'll be unable to spend that amount until you have checked out of the hotel or returned the car.
It may be wise, therefore, to use your normal credit card as security in these instances, but make sure you settle the bill in the local currency as the provider's currency exchange rate will normally provide poor value.
Best pre-paid travel cards
Some of the best pre-paid travel cards on the market are outlined below:
- Can have balances in different currencies on the same card
- Easy to top up when travelling using the Revolut app
- Very competitive exchange rates
- Make 5 free cash withdrawals or withdraw up to £200 per rolling month (whichever comes first). Withdrawals over £200 will be charged at 2% with a minimum fee of £1 (be aware that some ATMs will also charge a separate fee)
- If a balance is left on your card when returning from travelling, this can be spent at home by using the Revolut card as a debit card
- Split bills with family or friends at the touch of a button with no need for them to download the app, and you'll receive funds instantly
- Instant payment notifications with all transactions automatically categorised
- Ability to freeze or unfreeze your card through the app if lost, mislaid, or stolen
Read our full independent Revolut review to find out more.
Caxton FX Card
- 15 currencies can be held at any one time
- Free cash withdrawals (be aware that some ATMs will charge a separate fee)
- No charges on spending
- Top up is free via the app or online but there is a minimum load of £50
- £12,000 maximum balance on card at any time
- £300 daily cash withdrawal limit
Head over to their website to find out more about the Caxton FX Card.
Travelex Money Card
- Choose between 15 currencies
- No ATM withdrawal fees (although ATM provider fees may apply)
- App for checking balances and topping up card (minimum top-up of £50 via the app)
- Fixed exchange rate at time of buying currency
- £5,000 maximum balance on card at any time
- £500 daily cash withdrawal limit
Head over to their website to find out more about the Travelex Money Card.
The best app-only banks for travelling abroad
App-only banks are a great and relatively cost-free way of taking your money abroad. These banks are mobile-only and everything is managed in-app. They work in a similar way to Revolut but are also actually a bank, so you can spend using your debit card and you benefit from FSCS protection. You may think this sounds too good to be true and there must be a catch. In reality, the only catch is that some limits apply to the no overseas spending fees. It is also worth remembering that some ATMs are subject to charge a fee.
- Use wherever Mastercard is accepted
- Withdraw £250 for free within EEA every 30 days or £200 for free every 30 days outside EEA (a 3% charge applies afterwards)
- Spend with Mastercard's exchange rate and no markup fees
- Current exchange rate notifications upon arrival
- No need to notify the bank that you are travelling abroad (meaning your card will not be blocked)
- Ability to freeze and unfreeze your card if lost or stolen
For more information, read our independent Monzo review.
- No cash withdrawal fees
- Spend with Mastercard's exchange rate and no markup fees
- Earn interest on your balances (0.05% on balances up to £85,000)
- Instant spending notifications in both pounds and the local currency
- 24/7 customer support
- Lock and unlock your card in-app if lost or stolen
For more information, head over to our independent Starling Bank review.
- No ATM withdrawal fees
- Spend abroad fee-free
- Earn up to 1% cashback on your spending for the first 12 months both abroad and in the UK
- Currency conversion using Mastercard's Exchange rate
- Get up to 2.7% interest on an easy-access savings account
- Earn up to 5% interest on your round-up savings
- Freeze and unfreeze your card if lost or stolen
For more information, head over to our independent Chase Bank review.
Curve card is another great option to consider when travelling abroad. The card enables you to link all of your debit and credit cards via a secure app, meaning you only need to take one card away with you (you can switch between cards using the app). By using the Curve card, you won't pay any hidden fees, you'll get instant notifications so you can keep track of your money and you'll benefit from paying at the ‘real exchange rate' each time you make a purchase.
- Only have to carry one card – but can spend on all of your personal cards
- Instant notifications on spending
- Spend up to £1,000 fee-free every 30 days when abroad (2% fee thereafter)
- Withdraw up to £200 fee-free from an ATM every calendar month (2% fee thereafter)
- Categorised spending
- Notifications in local currency as well as your currency
For more information about the Curve card, read our independent “Curve review”
TOP TIP – If you are using a card to settle bills when abroad, you will often be asked whether you want to pay in local currency or in pounds sterling. You should always choose the local currency otherwise the retailer can apply what is known as Dynamic Currency Conversion, which is likely to have a higher exchange rate than your card issuer, and so the cost to you will be greater with the retailer pocketing the difference.
One of the safest ways to take money on holiday is a credit card, as the security issue is minimal and you don't have to decide in advance how much money you're going to need. If you do lose your credit card, or have it stolen, then you can just contact the card provider and they will issue a replacement. Additionally, some card providers allow you to block the card in seconds by simply using the linked smartphone app. However, there are still a couple of things you need to be aware of before deciding on this method to take money on holiday:
- Conditions – Check the conditions for your particular credit card, as there will usually be a charge for cash withdrawals and for using your card abroad. One thing to note is that most cards charge interest on cash withdrawals even if you repay the balance.
- Dynamic currency conversion – This means that suppliers may charge you in pound sterling rather than the local currency. The rate used for these sterling transactions is invariably not very competitive so you should always opt to pay in the local currency.
If you do not currently have a credit card, then there are a number of credit cards that offer 0% interest for a period of time as well as some with reduced or no transaction fees, but again make sure to check all the conditions as providers can change terms regularly. Using a credit card will also require a degree of discipline to make sure you pay off the balance when returning from holiday, and do not end up still paying for this year's holiday next year.
Best credit cards with no foreign transaction fees
Some of the best credit cards with no overseas transaction fees are outlined in the comparison table below:
|Provider||Fees Abroad||Interest Rate (Variable)||Cash Withdrawal Fee||Cash Withdrawal Interest rate (Variable)|
|Aqua Advance||0%||34.90%||5% (minimum £4)||44.95%|
|Barclaycard Rewards Credit Card||0%||25.90%||0%||25.90%|
|Santander All in One||0%||27.70%||3% (minimum £3)||29.90%|
|118 118 Money Credit Card||0%||34.00%||0%||34.00%|
To find out more about the best credit cards to use abroad, check out our article “Compare the best travel credit cards“.
A popular method of taking money on holiday is to just carry cash in the currency of your destination. Taking cash abroad also allows you to stick to a budget and is an easier way to track your spending. However, there are a couple of drawbacks to this option:
- Security – Carrying a large amount of money anywhere creates a security problem. Often when abroad we inadvertently advertise the fact we are tourists – checking maps, asking for directions, etc – thus leaving us vulnerable to theft. If cash is your only means of payment, a pickpocket could theoretically snatch everything you have to pay for your holiday with just one swipe.
- Exchange rate – All foreign currency services advertise two exchange rates – buying rate and selling rate. This means that you often buy foreign currency at a higher rate than the one offered if you have money left over at the end of your holiday. Additionally, when purchasing cash, you are locking in at one exchange rate which doesn't necessarily guarantee you get the best deal for your money.
It's not recommended to take cash abroad as your only means of payment, but obviously, you'll inevitably need to take some cash on your holiday to pay for things like taxis and restaurant tips. In this instance, make sure you take no more than necessary and be mindful of your security at all times. Avoid carrying cash in an easy-to-reach pocket or a bag that can be unzipped discreetly behind your back. Be mindful in close crowds and consider asking if your hotel or villa has a lockable safe.
In my opinion, the best way to take money abroad is using a pre-paid card or an app-only bank debit card, with a small amount of cash for emergencies. It is easy to open a new app-only bank account, and if you do so before you go on holiday, you needn't do anything else. Alternatively, if you are not ready to make the switch and have them as your main bank account, it is simple enough to apply for just a card and you have the same protection and security as a bank account without the costly hidden fees.
Overall, try to carry the least amount of cash possible – just enough for low ticket items, such as taxis or tips – leaving the card for bigger purchases or withdrawing top-up cash when needed. Although withdrawing cash at an ATM may incur a small charge (usually levied by the ATM operator and not the prepaid card provider), this is a small price to pay for the security provided.
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