It seems like every day there’s a new way of paying for your stuff. Contactless cards, apps on your phone and there was even talk of being able to use your fingerprints as a way of making a payment! As these new technologies increasingly become part of our daily lives, we’ve become so used to them that we almost take them for granted and don’t really give them much thought.
That is until you plan a holiday. When you’re going abroad and you’ll be using a currency that isn’t your own, you need to put some thought into how you’re going to handle your money. You can, of course, exchange your money before you leave and there are also a handful of cards out there that allow you to load any currency online. But which is the best option for you?
In the guide below My Baggage look at the pros and cons of going contactless (using your card over cash) on your holidays, to help you find the solution that is going to be most beneficial for you. Read on to find out more.
The pros of going contactless
In this first part, we’ll look at why you might choose to go contactless on holiday, relying on your card instead of taking cash with you.
The reality is that having a card you can just tap on a keypad can be a lot more convenient. It saves messing around with cash, counting the pennies and walking around with your pockets or wallet overflowing with coins. All you have to do is remember one small card.
Reducing room for error
Ever found yourself standing at the checkout, with a queue forming behind you, while you’re trying to remember your pin code? It happens more than you’d think! By using contactless payments on your card you reduce the risk of entering the wrong pin or forgetting it altogether.
By relying on the card you can travel very light when you’re heading out into town or on day trips. Instead of your wallet bulging from wads of cash, all you need is your card. You can even buy phone cases with a slot to keep your card in, so you really can travel light and keep your important belongings close.
Less chance of conventional fraud
Because the card touches the terminal and the transaction is directly device to device, there is less chance of conventional fraud tactics such as skimming.
No need to carry cash
Unfortunately, it is a sad reality that carrying cash does make you a target amongst thieves. If you eliminate the need to carry cash you’ll feel safer walking around unknown places and you’re less likely to become a victim of pick-pocketing or theft.
The cons of going contactless
Now we’ve looked at why using contactless cards can be useful on your holiday, we’ll look at the negative impact this can have too.
Losing track of your spending
One of the biggest problems with contactless cards is losing track of what you’re spending. When you have the cash it is a physical thing that you can see; you know what you’ve spent and how much you have left. Using contactless can often lead to going over your budget.
Higher conversion fees
Cards often charge a conversion fee from your native currency to that of the place you’re visiting. These can be a lot higher than if you choose to get cash from a bureau. Which means that you could be losing more money in the long run.
Losing your card
If you lose your card while you’re out and about this could leave you with no money at all! If you do choose to use a card instead of cash abroad, it’s always a good idea to have a spare in your hotel room. What’s more, if you drop your card and it’s contactless if someone finds it they are able to spend money from your account using the contactless feature.
Card is not always an option
It seems crazy we know! But there are still plenty of places out there that don’t accept cards, let alone contactless payments. In these situations, you could find yourself scrabbling for an ATM and paying through the roof charges to withdraw cash.
Limit on how much you can spend
There is a limit to how much you can spend on contactless payment. This can be inconvenient if you’ve done a larger shop or you’re buying more expensive items. As a general rule, the cut off for contactless payments is a £30 maximum.
While you may be less likely to be a victim of conventional fraud like skimming, there are people out there always finding new ways to hack the system. Contactless is no different and you could find that you become a victim of cyber fraud. Particularly if you’re in a country where you don’t speak the language and may not always be aware of what is going on with your payments.
Should I use contactless payments abroad?
At the end of the day, how you choose to make payments abroad is going to be based on what suits your needs and holiday style the best. Take into consideration the pros and cons outlined above to help you decide what is going to be the most beneficial option for you.
What’s more, it’s vital that you are always being careful and aware of your surroundings when exchanging money abroad. If you decide cash is safer, then be careful not to carry large sums of money with you. If you decide however that you prefer contactless, always be sure to check the amount before paying and have a spare credit card stashed away in your hotel room in case of emergencies.
Another thing that can be beneficial is having access to the internet or taking down the number of your bank. This way if you do lose a contactless card you can report/cancel it immediately.