Prepaid debit cards, a cross between traveler cheques and debit cards, have entered the traveling scene. But, are they worth the investment?
Here’s what you need to know before you buy.
Numerous credit card companies offer prepaid travel debit cards as alternative to carrying paper traveler’s checks.
They allow you to withdraw money, can be used wherever that brand of card is accepted, and can be replaced and reloaded if lost or stolen.
Unfortunately, there are significant hidden costs.
American Express’s card requires a minimum balance of $300 in addition to a $14.95 initiation fee, $2.50 fee for ATM withdrawal and 2 percent currency conversion charge.
VISA’s initiation fees range from $5-10 dollars, with a $2.50 international ATM withdrawal fee and a whopping 7% conversion fee.
In contrast, most ATM cards only charge between 1-3% for withdrawals and purchases, with a flat ATM fee of around $2 on most cards as well.
And if you do choose this method, for security’s sake, always bring a backup method of payment, like a credit card.