Holidaymakers snub travel currency cards

Half of travellers rely on cash

AA Travel Currency Card - Venice

Recent research by AA Financial Services shows that holidaymakers are still wary about using pre-paid travel currency cards.

The survey shows that nearly half of travellers (48%) rely entirely on foreign currency, taken out before they travel.*

Only 3% of those questioned say they use pre-paid travel currency cards, which have been hailed as the 'new currency' for holidaymakers.**

Will pre-paid cards become the new holiday currency?

The survey also showed that a quarter (23%) pay for what they need using their debit or credit cards, while another 14% use cash they obtain from ATMs while away.

The use of travellers' cheques appears to be declining, with only 8% using them, while secure pre-paid cards have been slow to catch on.

Mark Huggins, director of AA Financial Services, say he is surprised at the number who rely entirely on cash for their holiday spending.

"This really is the most risky way of taking your money. It opens you up to organised pickpockets and opportunistic thieves as well as accidental loss, which could make life difficult for your remaining holiday.

"What's more, if you do lose money you'll find that your travel insurance is likely to have strict limits on claims for loss of cash and some may not cover this at all."

Mr Huggins points out that while using debit or credit cards is secure and easy, their use could carry high transaction charges both for taking out cash from an ATM and for foreign exchange.

"It's worth doing your homework first and checking what charges might apply if you do use conventional cards," he says. "Clearly, depending on how much you spend, their use could land you with unwelcome additional costs when you get home."

Not only are they secure [pre-paid cards] are also potentially the cheapest way of managing your money while away

Mark Huggins, director of AA Financial Services

Mr Huggins says that although pre-paid cards seem to be some way off becoming the first choice for travellers, they are the future of holiday money for savvy travellers.

"Not only are they secure they are also potentially the cheapest way of managing your money while away," he points out.

"Application is straightforward and it can be loaded with euros or sterling in advance – depending on your destination – at a competitive exchange rate.

"It can be instantly topped up by by BACS, online or text message at any time of day or night from your own linked bank account, and there are no transaction charges for its use or for taking out cash sums over £50 or €50.

"If a travel currency card is lost it can be stopped instantly, while if a second card is held then funds can be transferred to that," says Mr Huggins. "It means that your money can still be available. If you lose a credit or bank card, the whole account is frozen until the issue of new ones."

AA Financial Services offers both sterling and euro travel currency cards. There is also a useful euro currency calculator that identifies the current card exchange rate.

Key findings from AA Financial Services research

Currency option

%

Take all the cash I need in local currency

48

Pay for things mostly using a credit/debit card

23

Take cash out of an ATM using a credit/debit card

14

Take travellers' cheques and pay cash

8

Take a pre-paid money card which can be used for cash or purchases

3

Other / don't know

4


* Research of 2,000 adults planning to holiday outside the UK carried out for AA Financial Services by OnePoll, May 2013.
** Mail on Sunday, 30 June 2013.

18 July 2013