4 currency and payment facts you need to know before heading out
Traveling is one of those universal activities that is enjoyed by just about everyone, but if you’ve never traveled outside American borders, you may be surprised by some of the intricacies of conducting international transactions. Before you leave home, consider these four important facts about foreign currency and payments.
Using Cash Could Make You Vulnerable
The idea of using actual foreign currency during your trip has a certain immersive appeal, but it may not be the best idea. What if you don’t convert enough, lose your cash while out on excursions, or have your wallet stolen?
Using credit cards while traveling will eliminate most of these problems. You won’t run out of funds until you hit your limit (giving you a comfortable cushion for emergencies), and the credit card company will automatically convert the funds for you. You might want to consider a card with no foreign transaction fees, though. Otherwise, you could end up paying a respectable amount of money for these perks.
Your Credit Card May End Up Useless, Whether Or Not Anything Is Wrong
Using credit cards while traveling might be a more convenient option, but there’s still risk involved. During all the constant activity of travel, you’re less likely to notice any early warning signs of fraud. Depending on where you voyage, it’s also possible that you could encounter the old magnetic strip card-reader systems, and these systems have many security vulnerabilities. That said, although the risk of true fraud is still higher than usual, an even more common problem is having your credit card frozen because of assumed fraud. When records show that a card has recently been used in two different places that are hundreds of miles apart, providers often suspect that the card has been stolen, and freeze it for security reasons. This is a well-meaning gesture, but when you’re just out traveling, it’s a major inconvenience.
To be safe, call your credit card provider before you head out on your trip and let them know you’ll be leaving the country so that they’ll know to expect some foreign charges. Keep your guard up when using your card to prevent any attempts at identity theft, and carry some backup methods of payment (like an extra credit or debit card) just in case.
Prices Converted to USD Are Almost Never Worthwhile
When using credit cards while traveling, you might be given the option to pay for the item in US Dollars (USD) instead of in the foreign currency used locally. This may seem convenient and easier for you to understand, but you should know that it usually isn’t done for your benefit. The merchant posting those prices has all the power to distort the true exchange rates to skim off more profit, and they often do. This isn’t always the case – there are many merchants who are entirely honest and really do just want to offer this extra bit of convenience to their customers – but it’s best to err on the side of caution and just pay the foreign currency price.
You’ll Probably Need Some Pocket Change
You might be able to get by fairly well in your day-to-day life with just debit and credit cards, but it’s usually a different story when you’re traveling. As a tourist, you’ll probably be on the lookout for local food carts, trinket stalls, and other commercial businesses that may not accept any form of payment other than cash. This is particularly likely to be the case in less developed countries, or even smaller towns, where fewer payment methods are commonly supported.
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