If you haven’t travelled abroad much, you might not be aware that using your credit or debit card from home could end up costing you a LOT of money, thanks to foreign transaction fees. But there’s actually no reason you should be incurring these extra charges as they are pretty avoidable with a bit of planning. In this article I’ll tell you how to avoid fees when using your card in the UK and give you a list of the best cards without fees, so you can save your cash for something more fun, like a private tour of the Tower of London or an upgraded London hotel.
But first…
What are foreign transaction fees?
Many credit and debit cards will allow you to pay for items that are being charged in a foreign currency, however they charge you extra to do that. Some have the AUDACITY to charge a flat fee per transaction PLUS a 3%+ fee on top of that!
That REALLY adds up when you’re travelling abroad for even just a few days, but there’s absolutely no need to be dealing with this highway robbery because there are no-fee card options, no matter where you’re from. I haven’t paid a foreign transaction fee for over a decade, so I’ll be sharing how to avoid fees when using your card in the UK.
When they ask “do you want to pay in pounds or your own currency”
While it’s not as common in London, if you travel around Europe or go to very touristy sights and attractions, you might go to pay for something and when the card machine is put in front of you, you might be asked if you’d like to pay in GBP or your home currency.
The temptation will exist to pay in your home currency, especially if you are still using a card with foreign transaction fees. But DO NOT DO THAT.
ALWAYS choose to pay in the LOCAL currency. Why? Because they are charging you an arm and a leg to let you pay in your own currency, so you’re ultimately being completely ripped off.
Same advice goes for getting cash out of a cash machine. This is a very easy initial way to avoid fees when using your card in the UK.
What cards can you use in the UK that have no foreign transaction fee?
Having the right card to use is the main way to avoid fees when using your card in the UK. Our audience is primarily from the US, so we’ll start with three US-friendly cards, but we have two options for non-Americans at the end of this list.
Also, while we’re saying they have no foreign transaction fees when visiting the UK, they are all fee-free in every country around the world, so they are just great all-around cards for travelling abroad.
We have also included cards that we think have valuable travel perks that make any annual fees completely worth it with just one international or domestic trip.
Chase Sapphire Preferred® Card (US residents)
Our first card with no foreign transaction fees when visiting the UK is the Chase Sapphire Preferred® Card. It’s a great first card for Americans who want no transaction fees but also to get some travel perks and protections. For example, your card comes with benefits like trip cancellation insurance, primary car rental insurance and lost luggage insurance, meaning you might not have to also pay for separate travel insurance, saving you a bit of cash.
You also earn points every time you spend on your card, especially when dining out or travelling, when you’ll earn up to 5 points per dollar (there are different spending bonus categories so this varies.) These points can then be used to get free or discount flights, hotels and more.
The annual fee for the Chase Sapphire Preferred® Card is $95, which is quite low compared to other travel cards and doesn’t seem like much considering you get $50 annual credit for hotel bookings through Chase Travel℠ .
This card is accepted EVERYWHERE across Europe, and I use the more advanced version of this card, the Chase Sapphire Reserve®, as my go-to travel card so I can earn points while avoiding foreign transaction fees .
Please note: points are not earned until after the first $300 is spent annually on purchases in the travel category with your Chase Sapphire Reserve®. The first $300 spent goes towards the $300 Annual Travel Credit.
Learn more about the Chase Sapphire Preferred®Card
Capital One Venture Rewards Credit Card (US residents)
This card also has no foreign transaction fees (a must) and is very travel-friendly— our founder Jess actually used this card back when she was studying abroad and backpacking around Europe. It also comes with great travel perks like an application fee credit for Global Entry or TSA PreCheck (up to a $120) and included travel insurance. You’ll earn miles for your spending which can be redeemed on things like travel or gift cards, and it has a low annual fee of $95.
Learn more about the Capital One Venture Rewards Credit Card
American Express® Gold Card (US residents)
If you prefer American Express over Chase or Capital One, the American Express Gold is a good starter for travellers. It of course has no foreign transaction fees (see rates and fees), and you earn Membership Rewards points when spending at home and abroad which can then be spent with Amex’s travel platform or can be transferred to many different airline and hotel loyalty programs for cheap or free future travel. The Gold also comes with some cost-saving travel protections like baggage insurance*.
The annual fee of the card is $325 but it’s mitigated with perks like earning up to $120 annual dining statement credit and up to $100 in hotel credits (terms apply, see rates and fees)**.
Something to note– downside of Amex is that it’s less widely accepted across Europe so you will need a backup Visa or Mastercard. But we at Love and London use the UK Business version of this card and have made some valuable flight redemptions with the Membership Rewards earned from it.
American Express also has absolutely fantastic customer service, so if you lose your card abroad, you won’t have to worry.
Image Courtesy of Wise
Wise (worldwide)
The Wise card, which anyone around the world can get, has no transaction fees and great exchange rates, plus you can withdraw up to £200 monthly from ATMs for free. You can start using your Wise card instantly with Google or Apple Pay, and getting the card costs just a one-time fee of £7 or the equivalent in your currency. It offers handy security options like freezing the card, and you get transaction notifications. With over 200,000 Trustpilot reviews and a 4.3-star rating, it’s highly trusted. Plus, there’s 24/7 support in 14 languages if you ever have any problems, making this a great card to use in the UK with no transaction fees.
Travelex (multiple countries)
The Travelex Money Card is a prepaid currency card that lets you load up to 15 currencies (including GBP) to spend around the world without any foreign transaction fees. It’s not linked to your bank account, which adds an extra layer of security to your money that you don’t get with a typical debit card. The card can be managed through the Travelex Money App, which lets you freeze and unfreeze the card, check balances, and top it up on the go. It also doesn’t charge overseas ATM/cash machine fees.
The downside of this card is that it has to be topped up, and it’s kind of annoying to have to work out how much more you need to add towards the end of your trip. They also charge you a £2 per month “in-activity fee” even if your card has expired, but only if you still have a balance left on it.
Take note that you can’t use this card anywhere around the world, it can only be used with 22 selected currencies and if you are travelling between a few different currencies in one trip, you’ll have to bounce your money around to each of your “accounts”, which is a bit inconvenient.
In my opinion the prepaid card is a pretty old school way to travel these days, with so many easier to use options that also give you travel perks and protections.
I hope this helps you save a LOT of money while you’re travelling the UK and spending in Great British Pounds… there’s absolutely no reason to pay foreign transaction fees once you grab any of these cards.
*Eligibility and Benefit level varies by Card. Terms, Conditions, and Limitations Apply. Please visit americanexpress.com/benefitsguide for more details. Underwritten by Amex Assurance Company
**Each Benefit requires enrollment via their website, terms apply to American Express Benefits and offers. Visit americanexpress.com to learn more.
***The information for the Wise Card and Travelex Money card has been collected independently by Love and London. The card details on this page have not been reviewed or provided by the card issuer.
Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, hotel, airline, or other entity. This content has not been reviewed, approved or otherwise endorsed by any of the entities included within the post.
