MANY people's thoughts will be turning to summer holidays and the prospect of a much-needed break right now. And whether it's rest and relaxation you're after, or something more exciting and adventurous, now could be a good time to have a think about what payment methods you want to use while you're abroad.
If you're taking cash with you, it's worth doing some research ahead to check out the best rates. Don't forget to factor in any fees as well as exchange rates, when weighing up the best-value deals.
Bear in mind that taking large amounts of physical cash abroad has its risks, as well as sometimes creating difficulties when it comes to paying with large denominations - so many people will also be relying on cards for their holiday spending.
Financial information and star ratings provider Defatqo has looked at the different options when it comes to cards and fees, to help cut through any confusion, and find products to suit holidaymakers depending on what they want out of their deal.
Among the top debit cards, it highlights one from Chase, which pays 1 per cent cashback on debit card spending - including while you're away on holiday. Cashback is available for the first 12 months for new customers, up to a maximum of £15 per month.
Chase's website says its currency converter uses Mastercard's exchange rate, and it won't add transaction fees.
Local banks may charge their own fees for making an ATM withdrawal, so it's important to bear this in mind as well. Defaqto also highlights Virgin Money's M Plus Account, which has a debit card with no worldwide foreign transaction fees.
When looking at credit cards as an option, there are some cards which will offer no fees for transactions aboard but also offer a 0 per cent purchase offer - giving people some extra time to pay off their holiday spending.
Defaqto highlights Tesco Bank's Clubcard Plus Credit Card and some credit card options from Nationwide Building Society as examples. Terms and conditions will apply.
Unfortunately, holidays can sometimes be marred when cards are lost or stolen.
Out of 33 providers Defaqto looked at in mid-May, just under half (15) offered the functionality in-app and/or online to freeze debit cards while abroad.
Providers offering customers this peace of mind to freeze their card if needed include TSB, Nationwide Building Society, First Direct, HSBC UK, Santander, Lloyds Bank, Halifax, Bank of Scotland, Metro Bank and several others.
Katie Brain, a consumer banking expert at Defaqto, says: "Using a credit card or debit card is a convenient way to pay for day trips, restaurant bills, and other holiday expenses. However, many debit and credit cards will be charging a foreign transaction fee of an average 2.48 per cent for credit cards and 2.24 per cent for debit card transactions within Europe (2.29 per cent worldwide)."
"You will also usually pay this fee for cash withdrawals too. These fees soon stack up after a week or two abroad," Brain adds. "The good news is they are avoidable if you shop the market before you travel and take out a card that has either zero or very favourable fees when used outside of the UK."
Defatqo analysed the card market in May 2023 and offers can be withdrawn or subject to change. Some providers may also launch new summer offers, so it's worth keeping an eye out.
Some people may want to consider prepaid travel cards, which enable holidaymakers to load up the currency they will be spending. Loading up a certain amount may also be helpful to people who want to stick to a certain holiday budget while they are away.
If you're not keen on prepaid cards, travel debit card Currensea has a different offering. It uses technology to link directly to existing bank accounts, allowing people to spend directly from their current account when abroad.
Brain also has some further suggestions for avoiding card spending mishaps while abroad: "Save your bank's contact details in your mobile phone in case of any issues or lost cards."
Having your mobile banking set up on your phone could also potentially make it easier to freeze your card quickly if it becomes lost or stolen. To avoid being locked out of your ability to spend, she suggests making sure you've memorised your Pin.
She also suggests setting up a direct debit to pay your credit card bill when it is due, to avoid missing any repayments. Brain adds: "Pay in the local currency where possible - not in pound sterling - to avoid bad exchange rates set by merchants."
She also suggests having two separate cards with different payments processing companies, if this is an option for you. That way, if one firm is experiencing any technical issues, then the other card should still work.