Are you gearing up for that dream vacation? Whether you’re eager to explore ancient ruins, enjoy big-city nightlife or unwind on a beautiful tropical beach, being well-prepared is essential. You’ll avoid unexpected surprises or unfavourable exchange rates that could disrupt your budget and dampen your holiday spirit.
Pros and cons of currency exchange vs card payments abroad
Should you use cash or cards when travelling? Both options have their pros and cons. Choose the option that causes you the least stress, so you can focus on the fun stuff.
On one hand, having cash on hand makes small expenses, like quick snacks or taxi rides, quick and simple. On the other hand, cards mean you don’t have to carry large amounts of cash, and most cards come with nifty security features to safeguard your funds during your journey.
Pros of using cash when travelling
- Cash is universally accepted almost everywhere, provided you convert to the local currency.
- It’s a reliable choice for businesses that don’t offer card facilities, like local markets and street vendors.
- Cash transactions don’t come with additional fees.
- You can buy local currency from your bank before your trip, so you know exactly what exchange rate you’re getting.
- Cash transactions offer a higher level of privacy. They don’t leave a digital trail of your purchases.
- Cash is essential in remote regions where card payment systems may not be available.
Cons of using cash when travelling
- Carrying cash can be risky and stressful if you don’t have a secure place to store it.
- If cash is stolen, your money may not be fully protected. Insurance providers often have limits on how much they’ll reimburse for stolen cash, and you may need to pay an excess on your claim.
- You may struggle to estimate how much you’ll need, which can make budgeting tricky.
- If you’re travelling with cash only, you may find it difficult to add impromptu activities.
Pros of using a bank card when travelling
- Most South African bank cards are linked to Visa or Mastercard, ensuring global acceptance.
- Cards offer convenience and eliminate the need to carry large sums of cash.
- Cardholders can benefit from built-in safety features.
- Informing your bank of travel plans can prevent card blocks due to irregular transactions.
- Some cards (especially credit cards) offer cashback or reward benefits for overseas spending.
- Credit cards provide a safety net in case of unexpected expenses, giving you access to a line of credit while abroad.
- Some bank cards, especially premium or travel-specific ones, offer free travel insurance coverage.