Credit Cards

The 3 Best Credit Cards to Use Abroad in Europe

So, you’re packing for a trip to Europe – or maybe you’re already dreaming about planning a full-on move abroad – and someone inevitably brings up travel money. “Just use your credit card abroad,” they say, as if that’s all there is to it. 

But, as you probably know, using a standard UK credit card overseas isn’t always straightforward. Suddenly, you’re up against exchange rate quirks and foreign transaction fees that seem to pop up out of nowhere. 

So, with so many options, and all those little fees waiting to catch you out, it pays to figure out which cards actually give you a fair deal when you spend abroad.

Can’t I Just Use My UK Card?

Let’s just get straight to it: most UK-issued credit cards are not designed for travel. If you use a standard UK credit card in Europe, there’s a good chance your card provider will hit you with a non-sterling cash fee and possibly a percentage on every purchase made in euros. 

Even withdrawing cash can be a mess, since overseas cash withdrawals typically attract a separate cash withdrawal fee, and often, interest from the day you take the money out. 

What Can I Do?

Fortunately, there are specialist travel credit cards out there, designed specifically for people who want to spend abroad without getting stung by unnecessary costs. If you know what to look for, and you’re prepared to dig into the details, you can find a card that won’t make your holiday or expat life more expensive than it needs to be.

What Makes a Credit Card Good for Travelling in Europe?

The best credit card deals for travel usually come down to three things:

No Foreign Transaction Fees

Most standard UK credit cards charge around 2.75% or 2.99% per transaction abroad. That’s nearly £3 on every £100 you spend in euros, which adds up quickly. The best cards for spending in Europe have no foreign transaction fees at all.

Fair Exchange Rates

Some card providers sneak in extra charges by offering “their” exchange rate instead of the official Mastercard or Visa rate. Specialist travel credit cards will use the standard network rate without mark-ups, so you don’t get short-changed.

Low or Zero Cash Withdrawal Fees

Withdrawing cash on a credit card is rarely ideal, but sometimes you don’t have a choice. A good card will either not charge extra for overseas cash withdrawals or at least be clear and fair about it. Some cards don’t charge a cash fee but will still start charging interest from the moment you take money out, so it’s worth checking the details.

It’s also worth checking if your card charges annual fees or works with Apple Pay and Google Pay – especially if you’re in a country where contactless is more common than cash.

Which Are the Best Credit Cards to Use in Europe Right Now?

To help you narrow it down, here’s what makes some of the best cards stand out and where to watch out for small print.

  1. Halifax Clarity Credit Card

This one’s a bit of a favourite among frequent travellers and expats. The Halifax Clarity Credit Card keeps things simple – no fees on purchases made abroad, and you get the Mastercard exchange rate with no sneaky mark-ups. 

What we like about this is that if you withdraw cash abroad, there’s no extra Halifax fee. But you’ll still pay interest from the day you take out the money, so only use it if you have to and pay it back quickly. 

Also, there’s no annual fee, which is always a nice bonus. Most people find it’s accepted pretty much everywhere in Europe where Mastercard is taken, and it’s easy to manage from the Halifax app, which is handy if you’re on the move.

  1. Barclaycard Rewards Credit Card

The Barclaycard Rewards Credit Card is a strong contender, too, especially if you’re not keen on paying interest on cash withdrawals. This card charges no foreign transaction fees on purchases or cash withdrawals, and – unusually – you won’t even be charged interest on cash withdrawals as long as you pay off your balance in full each month. That’s a rare deal.

There’s no annual fee, and you also earn cashback on your spending, which isn’t typical for travel cards. It runs on the Visa network, so it’s accepted in pretty much every European country.

3. Chase Debit Card (Current Account)

While it’s technically a debit card, the Chase account deserves a mention. The Chase debit card doesn’t charge for card payments or overseas cash withdrawals, and it offers the Visa exchange rate, which is about as fair as you’ll get. 

You get 1% cashback on purchases, and there are no account fees. Plus, it’s app-based, so it’s easy to manage on the go. If you’re worried about budgeting or don’t want to use credit at all, this one’s a strong alternative to a prepaid currency card.

Honourable Mentions

The Virgin Money Travel Credit Card and Santander Zero Credit Card also have no foreign transaction fees and are worth considering if you already bank with them or want another option. 

Just make sure that you always double-check the eligibility requirements and whether you need to open a new account.

What Fees Should You Watch Out for When Using a Card Abroad?

There are a few charges that can sneak up on you when you use your credit card abroad:

  • Foreign Transaction Fees: This is charged by many standard UK credit cards – typically around 2.99% on each overseas purchase.
  • Cash Withdrawal Fees: If you take money out at an ATM, your card provider might charge a fixed fee, a percentage, or both. Plus, interest often starts straight away.
  • Non-Sterling Cash Fee: A sneaky extra charge for cash withdrawals in any currency other than pounds. You’ll find this on a lot of cards.
  • Exchange Rate Margins: Some card providers add their own mark-up to the exchange rate, which isn’t always obvious at first glance.

If you’re offered the choice to pay in pounds or euros at a shop or ATM, always pick the local currency! Dynamic currency conversion almost always means a worse rate for you – not to mention all the extra fees added on top. 

How Upscore Can Help

Planning a weekend in Barcelona? A road trip through the Alps? Pickling the right card can make your life much easier. If you’re looking to keep your financial options open wherever you go, consider signing up for Upscore’s Finance Passport to take your credit history with you!

Sign Up for Upscore’s Finance Passport Today!

A Guide to Credit Builder Cards in the UK: Strengthening Your Financial Future

In the landscape of financial tools available within the UK, credit builder cards offer a beacon of hope for those looking to improve their credit score or build it from the ground up. These cards are not just a means to an end but a strategic step towards establishing a healthier financial profile. This post will delve into the essence of credit builder cards, how they function, and briefly touch upon the variety of providers in this space, acknowledging the presence of unique alternatives like CreditSpring.

Understanding Credit Builder Cards

Credit builder cards serve as a financial stepping stone for individuals with poor or no credit history. Their main features include:

  • Accessibility: These cards are more readily available to those with lower credit scores.
  • Higher Interest Rates: Reflecting the higher risk assumed by issuers due to the applicant’s credit status.
  • Lower Credit Limits: To help users manage spending and minimise risk.

The aim is simple: to facilitate a way for individuals to prove their creditworthiness over time through responsible use.

The Functionality of Credit Builder Cards

The principle behind credit builder cards is straightforward. By making regular purchases and ensuring the balance is repaid in full each month, cardholders can demonstrate fiscal responsibility. This activity is reported to credit bureaus, thereby positively influencing the user’s credit score. Key practices for effective use include:

  • Timely Payments: Ensuring at least the minimum required payment is made by the due date, with a full balance repayment being the ideal scenario.
  • Low Credit Utilisation: Maintaining a low balance relative to the credit limit to positively affect your credit score.

The Broader Ecosystem of Credit Builder Solutions

While credit builder cards are a common tool for improving credit scores, the financial market also includes innovative solutions like CreditSpring, which offers a subscription-based model for credit access. However, CreditSpring is just one of many alternatives in a diverse marketplace that includes other providers, each with its unique offerings and benefits. These alternatives encompass:

  • Traditional Banks and Credit Unions: Many established financial institutions offer credit builder cards with various terms and conditions tailored to different consumer needs.
  • FinTech Companies: The rise of financial technology firms has introduced new and innovative credit building solutions, ranging from digital-first credit cards to apps designed to help users manage their credit through smart spending and repayment strategies.
  • Specialised Lenders: Some lenders focus specifically on the credit-building segment, providing products and services designed to help individuals with poor credit scores or limited credit histories.

Each provider has its nuances in terms of fees, interest rates, credit limits, and additional benefits, making it essential for consumers to research and compare options to find the best fit for their financial situation and goals.

Conclusion

Credit builder cards and the broader spectrum of credit building solutions play a crucial role in the financial toolkit available to UK residents. Whether through traditional credit cards or alternative services offered by various providers, these tools share the common goal of aiding individuals in establishing or repairing their credit scores. By selecting the appropriate solution and adopting responsible financial habits, individuals can pave the way to improved financial health and access to a wider range of credit products in the future. As always, it’s advisable to thoroughly review and understand the terms of any financial product before committing, ensuring it aligns with your personal financial strategy and goals.

Understanding the Different Types of Credit Cards Available in the UK

Navigating the world of credit cards in the UK can feel overwhelming with the myriad options available, each tailored to suit diverse financial needs and spending habits. Whether you’re looking to earn rewards, build credit, or manage debt, understanding the different types of credit cards can help you make an informed decision. This blog post delves into the various credit card options available in the UK, highlighting their benefits and ideal use cases.

Standard Credit Cards

Standard credit cards, often referred to as ‘plain-vanilla’ credit cards, offer no frills or rewards. They are straightforward, providing a credit line for purchases, cash advances, and sometimes balance transfers. These cards are suitable for individuals seeking a simple credit option without the complexity of rewards or annual fees.

Balance Transfer Credit Cards

Balance transfer credit cards are designed for individuals looking to consolidate debt and save on interest payments. These cards offer low or 0% interest rates for a promotional period on balances transferred from other credit cards. This can be an effective way to reduce debt faster, as more of your payment goes towards the principal rather than interest. However, it’s important to consider balance transfer fees and ensure you can repay the balance before the promotional period ends to avoid higher interest rates.

Rewards Credit Cards

Rewards credit cards offer points, miles, or cash back on your spending. They are ideal for individuals who pay off their balance in full each month and want to earn rewards for their purchases. These cards can come in various forms, including:

  • Cashback Cards: Earn a percentage of your spending back in cash.
  • Travel Cards: Accumulate points or miles that can be redeemed for flights, hotels, or travel-related expenses.
  • Points Cards: Collect points that can be exchanged for goods, services, or vouchers.

Choosing the right rewards card depends on your spending habits and reward preferences. It’s also crucial to weigh the benefits against any annual fees.

0% Purchase Credit Cards

These cards offer 0% interest on purchases for a set period, making them an attractive option for financing large purchases without accruing interest. After the promotional period, the interest rate reverts to the standard rate. It’s a valuable tool for managing cash flow, provided you have a plan to pay off the balance before the promotional offer expires.

Credit Builder Cards

Credit builder cards are targeted at individuals with poor credit histories or those looking to build credit. These cards typically come with lower credit limits and higher interest rates but can be a stepping stone to improving your credit score. By using a small amount of credit and paying it off in full each month, you can demonstrate financial responsibility and improve your creditworthiness.

Premium or Luxury Credit Cards

Premium credit cards cater to individuals with excellent credit scores and high incomes, offering exclusive benefits such as concierge services, access to airport lounges, and comprehensive travel insurance. These cards often come with a high annual fee but can offer value for frequent travellers or those who can take full advantage of the perks offered.

Business Credit Cards

Designed for business owners and entrepreneurs, business credit cards help manage company expenses, offering benefits like cashback, travel rewards, and detailed spending reports. These cards can also help separate personal and business expenses, simplifying accounting processes and potentially improving cash flow management.

Conclusion

The UK credit card market offers a diverse range of options to cater to different financial needs and lifestyles. Whether you’re looking to manage debt, earn rewards, or build credit, there’s likely a credit card that fits your requirements. It’s important to consider your financial situation, spending habits, and the card’s terms and conditions before applying. By selecting the right credit card, you can enhance your financial flexibility and potentially reap valuable rewards.

Register
HQ

1-2 Charterhouse Mews, London, England, EC1M 6BB.

© 2024 All rights reserved