People who frequently travel abroad often carry a separate credit card for this purpose, one carefully selected for overseas use. But when selecting a credit card for overseas travel, what are the most desirable features?
A good credit card for overseas use will provide travel benefits at no cost, such as free travel insurance to protect against problems which may be encountered during a trip abroad, such as lost baggage and cancellations. This feature doesn’t often appear on “no frills” cards, those with low interest rates or no annual fees. But receiving these benefits at no cost through the credit card, rather than having to purchase travel insurance separately, may be worth the higher interest or annual fees paid.
Some travel credit cards also offer international medical insurance as a benefit, although the coverage may be limited. While this sort of insurance is more valuable to a card holder on holiday than a business traveller whose expenses are likely covered by his or her employer, it’s nevertheless a valuable benefit should the need arise.
Another valuable benefit for an overseas travel credit card is lowered foreign currency transaction charges. These charges are incurred when a credit card purchase is made in the currency of another nation, as the issuing bank must exchange funds internationally to cover the cost of the transaction. Some credit cards do not charge foreign currency transaction fees or sharply limit them, a desirable feature when selecting a credit card for overseas travel.
Credit cards for overseas travel also should have a strong security system to protect against lost, stolen, or compromised cards. It’s difficult enough replacing a lost or stolen card in one’s home country. But replacing a credit card overseas is infinitely worse, particularly as the traveller’s spending is curtailed until the replacement arrives.
