Forex vs credit card, explained
With the ease of modern travel, jetting off to new destinations has become simpler than ever. But when it comes to managing your money abroad, should you rely on a Forex card or a credit card?
Your choice can impact your spending, so it's worth exploring which option offers better value and convenience.
Ready to explore the world - but which card should you rely on?
You've booked your flights, your suitcase is packed, and you're counting down the days until your next adventure (hopefully booked through the Vitality Travel platform for the best discounts!) But there's one more thing to consider: should you use on a Forex account or your trusty credit card while you're travelling? Opting for a foreign currency card might be a good idea and here's why:
1. Say goodbye to foreign transaction fees
A Forex card is tailored for seamless foreign currency transactions, helping you avoid international currency conversion fees that can catch you off guard. Imagine you're enjoying a summer getaway in Rome, indulging in gelato and shopping for Italian loafers. With a Forex card, you can make purchases in Euros bought ahead of time at a known exchange rate without worrying about additional fees piling up.
In contrast, using a credit card often means paying a foreign conversion fee on every purchase, which can quickly add up if you're travelling for an extended period or splurging on a big-ticket item.
2. Minimise ATM withdrawal costs
While on the road, it's common to need cash for tips, street markets, or small cafes that don't accept cards. Forex cards generally offer lower ATM withdrawal charges abroad compared to credit cards, so you can access your funds without incurring hefty fees. This means more money for memorable experiences and less spent on unnecessary charges.
3. Protect yourself from currency fluctuations
The South African Rand can be quite volatile, which means currency fluctuations can impact your travel budget. By holding your funds in a foreign-denominated currency account, you can lock in your spending power and avoid the stress of a fluctuating exchange rate. This is especially useful for travellers who like to plan and budget their trips carefully.
4. Avoid the pitfalls of dynamic currency conversion
When using a credit card abroad, you might encounter the option to pay in your home currency at the point of sale. This practice, known as dynamic currency conversion, often comes with an unfavourable exchange rate, making your purchase more expensive than it needs to be. With a Forex card, you pay in the local currency, bypassing this hidden cost and ensuring you get the best value for your money.
5. Travel to multiple countries with one card
If your travel itinerary includes multiple countries, a multicurrency Forex card is your best companion. It allows you to pay and transact in various currencies with ease, making your journey across borders smooth and hassle-free. No need to juggle multiple cards or worry about carrying different currencies - your Forex card has you covered.
6. Use credit cards as your safety net
While a Forex card is ideal for everyday transactions during your travels, it's wise to carry a credit card as a backup. Credit cards can offer valuable protections, such as fraud alerts and travel insurance. Plus, with Discovery Bank's Dynamic Interest Rates, you could benefit from reduced borrowing costs if you need to use your credit card in an emergency.
Travel savvy by opening a Discovery Bank Real-Time Forex Account today
With Discovery Bank, you can open a British Pound, Euro, or US Dollar account anytime through the Discovery Bank app and start using it immediately. Receive international payments in any of these currencies and make payments in over 60 other currencies with ease. What's more, you can:
- Add a free virtual card or order a physical debit card for secure payments and withdrawals wherever you are in the world. Here's how to set up your free forex virtual card.
- Enjoy zero fees when transferring funds between your foreign currency accounts. Here's how to make secure online payments in over 60 currencies using your Discovery Bank forex accounts, easily and conveniently on your banking app.
- Track your spending and manage your foreign currency allowance effortlessly through the Discovery Bank app. Here's how you can get the best buy and sell rates 24/7.
With no minimum balance required, anyone over 18 with a Discovery Bank Transaction Account, Credit Card Account, or Suite can quickly add a Forex account to their portfolio. Travel savvy on your next trip by setting up a Discovery Bank Forex account today!