Unless
you have spent the penultimate day of your holiday searching for a dodgy gift
shop that will let you use your debit card to get cash (for an exorbitant amount
of commission) so you can pay your hotel bill, you may not have learnt this
vital lesson - when abroad, it is not always possible to use your plastic. But
what do you do when you can’t find a place to get your travellers’
cheques encashed?
Cash
from ATM at destination
Good
deal: This comes really handy and is quite a reliable way to stay away from the
money panic attacks. This way, you’re not carrying around wads of cash and
even if your card is stolen or misplaced, it can be cancelled effortlessly. You
just make small withdrawals at any ATM whenever you need cash. Many public
sector banks and banks like HDFC Bank, Citibank, Standard Chartered Bank, ICICI
Bank issue international cards. These cards are accepted at most places as they
affiliated to MasterCard or Visa International.
The
hitch: You can avail of this convenience only when you pay an exorbitant
transaction charge levied each time you swipe your card. They usually range from
one per cent to five or six per cent.
Travellers’
cheques
Good
deal: They can be easily replaced if lost. If you have any left over, you can
hold on to them, they don’t expire. They are good for budgeting. There are
about 73,000 locations around the world where you can encash them for free. You
can use them like money in some countries when the cheques are in the local
currency.
The
hitch: You buy them and you’re charged a commission fee. You can also be
charged to encash them.
Credit
cards
Good
deal: They are as good as the debit or international card. And if they are lost
or stolen some card providers will replace yours while you are abroad.
The
hitch: When you use your credit card abroad there are three separate charges to
watch out for. First, you will usually pay interest on any cash from the day you
change it. This applies even if you have got an interest-free deal on your
credit card. Secondly, watch out for the ‘foreign currency loading’
charges. Credit card providers charge for the privilege of withdrawing foreign
currency or making purchases overseas. Finally, the handling fee can go up to
two per cent whenever you withdraw cash abroad.
Exchanged
cash
Good
deal: You can avoid surplus charges which you would have to pay if you used
credit cards and travellers’ cheques. It is handy to pay for smaller
purchases and cab fare when you first get there.
The
hitch: It’s risky to carry an enormous amount of cash on holiday, even if
you have a safe in your room. If, in any case, the money is lost or stolen, and
your trip has been insured, yous’ll get only a small amount back, that
too, only after you reach home.
The
magical combo
Never
rely on just a single mode of changing money. Be wise to carry a combo of cash,
debit cards, credit cards and travellers’ cheques. Some currency in hand
can make life easier when you first arrive. While using cash cards keep the
number of your withdrawals down to a bare minimum. Paying for large items with
your credit card can give you peace of mind.
So
are you all set to take off with your wallet talking dollars, pounds and euros?
Bon
voyage!
