July 19, 2024

8 Tips For Using Your Credit Card Overseas

Picture this: You're sipping a cappuccino in an Italian piazza or browsing bright fabrics in an Indian market. The world's wonders are at your fingertips, and with the swipe of a credit card, they can be yours. But while the joy of discovery is universal, the intricacies of global transactions… not so much.

Now could be a great moment to learn some of the best and safest ways to use your credit card while traveling internationally. (Maybe you’re even reading this in that piazza, market, or bazaar and ready for some answers.) So yes, it’s true that using a credit card overseas can be convenient for making purchases, but you should know more to avoid running into any unforeseen fees or payment problems.

Here are some essential tips to maximize your credit card's potential abroad, adding to your journey's memories, not its headaches.

Do credit cards work internationally?

Yes, most credit cards work overseas, but you definitely should be aware of the potential foreign transaction fees and varying acceptance rates for different card networks. Remember to inform the card issuer of your travel plans before leaving your country of residence. This helps prevent fraudulent activity.

8 tips for using your credit card overseas

The joys of travel can be priceless, but you should still approach it with a monetary map. Here are eight best practices to keep in mind when swiping your credit card while abroad:

1. Notify your card issuer

Before you travel, let your credit card issuer know about your trip dates and destinations. This will make sure your card isn’t flagged for suspicious activity when used in a different country and will avoid you having to call your issuer once you’re already abroad, which could be costly or inconvenient.

2. Use chip-and-PIN cards

When traveling, especially in Europe and parts of Asia, using chip-and-PIN credit cards may be more convenient and widely accepted than traditional magnetic stripe cards. Chip-and-PIN cards offer an added layer of security and are often required for automated payment machines, like ticket kiosks and toll booths.

3. Carry multiple cards

Bring at least two different credit cards to have a backup option in case one of your cards gets lost, stolen, or declined. And aim to have at least one card with no foreign transaction fees.

4. Pay in the local currency

Decline offers to be charged in your home currency (dynamic currency conversion) at merchants, as it often comes with higher fees.

5. Keep emergency contacts handy

Carry contact details for your card issuer's customer service and your card's lost or stolen hotline. This way, in case of any issues, you can quickly get assistance.

6. Use ATMs wisely

If you need cash, use ATMs from reputable banks to avoid excessive fees. Avoid exchanging money at airport or train station currency kiosks, which often charge higher rates.

7. Monitor your accounts

Check your credit card accounts online or through mobile apps to track transactions and detect any unauthorized activity.

8. Be mindful of skimming

To protect your card information, try to only use ATMs and card readers that appear secure and have no signs of tampering.

Advantages of using credit cards abroad

From security to a whole range of perks, using credit cards internationally can offer some great benefits on a trip. Here are a few:

Convenience and security: Credit cards are a convenient, safe way to make payments during your trip. Instead of carrying cash, using your credit card for purchases reduces the risk of loss or theft. Many credit cards also offer built-in fraud protection, eliminating unauthorized transaction risk.
Wide acceptance: Credit card networks––including Visa, Mastercard, and American Express––are widely accepted globally, which means you can use them at most hotels, restaurants, stores, and entertainment venues.
Foreign currency conversion: You may wonder if it’s better to exchange money or use a credit card. Many credit cards offer competitive foreign currency conversion rates, often better than those at currency exchange offices. Credit cards for purchases in local currency may help you avoid unfavorable exchange rates and may save you money on conversion fees.
Travel rewards and perks: Many credit cards, especially travel-specific ones, offer rewards and perks tailored for globetrotters. These may include airline miles, hotel points, higher cashback on travel-related expenses, and travel insurance coverage. A travel credit card can also help you enjoy benefits like airport lounge access or complimentary travel insurance.
Easy expense tracking: Using credit cards facilitates seamless expense tracking while traveling. Most credit card statements have detailed information about your transactions, making managing your travel budget and tracking spending simple.

Note: If you want to use debit cards internationally instead of credit cards, you can. You just might lose a few additional benefits like cashback, rewards, and protection against fraud. However, the consumer should always check the terms and conditions of their credit card before they go on a trip so they are aware of the benefits and limitations

Disadvantages of using your credit card abroad

While using credit cards abroad has advantages, there are some potential downsides. Here are a few:

Foreign transaction fees: Many credit cards charge foreign transaction fees, typically around 3% of each purchase made in a foreign currency. These fees can quickly add up and erode the savings you gain from favorable exchange rates.
Limited acceptance: While major credit card networks are widely accepted, some smaller establishments and rural areas still prefer cash. Relying solely on credit cards may limit your ability to make certain purchases.
Currency conversion markup: Even if your credit card offers reasonable foreign currency conversion rates, some issuers may add a currency conversion markup to the exchange rate, increasing the overall transaction cost.
Pre-authorizations and holds: Hotels, rental car agencies, and other merchants may place pre-authorizations or holds on your credit card for potential expenses. These can tie up your available credit and may take several days (or even weeks) to be released.
Security concerns: While credit cards offer fraud protection, there's still a risk of card skimming or other hacks, especially in tourist-heavy areas. Always be vigilant when using your credit card, and avoid using it on unsecure websites. By taking such simple yet necessary precautions, you can make your international credit card use safe and secure.

Work hard, play hard with EarnIn

Before you leave on your adventure, download EarnIn to make sure you have the financial tools you need to keep moving forward while planning a trip abroad.

The EarnIn app features Cash Out, our groundbreaking tool that lets you access your pay as you work with no interest, no mandatory fees, and no credit checks, unlike costly loans or credit card cash advances.

Using EarnIn can help you cover vacation expenses without the stress of waiting for your paycheck. If you’re looking for the best deals for a flight, Cash Out may help you get them with no issue, and you can also use EarnIn’s Card overseas, having an extra financial support at hand. Finally, create a plan to become debt-free sooner with our free credit card payoff calculator.

Download the EarnIn app now and discover the power of making every day payday, at home and abroad.

Disclaimer: Please note, the material collected in this post is for informational purposes only and is not intended to be relied upon as or construed as advice regarding any specific circumstances.