Paying with plastic when abroad
July 23, 2014
Here in the GCC, we’re in the midst of the travel season and one of the most popular getaway weekends is upon us – Eid Al Fitr.
We’ve already given you some suggestions on where to head abroad, or which hotel to book for a staycation. But we decided to enlist the help of Anil Chander, head of cards at RAKBANK, for advice on how to best manage credit cards, foreign currency and conversion rates while on your vacation.
What do I need to know about currency conversion?
First of all, make sure to exchange the cash in your home country where you will normally get a better rate than in the country of destination. When paying with your card, you may find that merchants will give you the option of paying for your purchases in UAE Dirhams (AED) instead of the local currency of the country you are visiting.
Paying for your purchases in a foreign currency will almost always carry a better exchange rate than choosing to pay in AED. When you pay in AED, the exchange rate determined is at the merchant’s discretion. Also, you may lose out on earning cashback or other rewards on international transactions.
What are the benefits of using my card abroad?
Whether it’s avoiding carrying large amounts of cash or being discreet when opening your wallet to pay, cards are a convenient and safe way to make payments. The best part about using your credit card is the ability to track finances and enjoy the many benefits that come with them including business lounge access at participating airports worldwide.
What happens if my card gets stolen?
If you happen to lose your card call the bank to block it immediately. Some mobile banking applications, like that of RAKBANK, even allow you to report a lost or stolen card through your phone. Most banks will courier a new one to you anywhere in the world within 24 hours.
However, many people fear that if the card is not lost but temporarily misplaced, then blocking it will run the risk of losing access to the credit card even if it is found shortly after. Bear in mind that your bank can temporarily put a hold on your card in such cases and activate it if you find it within a few hours. Also check to see if it carries ‘lost card insurance’ that you can benefit from.
Five useful tips to know before travelling:
1. Do not let the merchant charge the transaction in AED. Paying in the local currency is more beneficial.
2. Keep your receipts.
3. Keep sufficient balance in your account for the kind of travel spends you anticipate. Remember you can always ask your bank for a temporary limit increase on your credit card.
4. Take two or more cards with you on your trip incase you lose one.
5. Check to see if you are entitled to medical and travel insurance through your card as well as purchase protection.