It can be challenging to settle your hotel bill or even purchase souvenirs if you have to deal with a different currency for every transaction. Are you planning to travel abroad? The advent of smartphones has made paying for everything even easier. Mobile payment methods are really popular today. Keep on reading to learn about exchange rates, transaction fees, and top payment methods to choose from during your vacation.
What’s the Best Payment Method for Overseas Travel?
Many travelers who decide to go overseas may be surprised to find out that consumers outside the USA rarely if ever, use cash or physical credit cards. There are many “we don’t accept cash” signs in many countries around the world. The pandemic has changed the way we think about travel and money. There are plenty of top cash advance apps that offer additional funds through a digital and streamlined process. More and more businesses don’t accept cash.
Many lenders also issue the funds digitally so that consumers don’t need to go out and can take out supplemental money directly through their phones. Many European and African countries are moving to a cashless society.
This process has already started before COVID-19 but this global pandemic has accelerated the usage of QR codes and contactless payment methods. Even two years before, many American travelers counted on an ATM for withdrawing cash and carried at least two credit cards with them.
Why Mobile Payment Method Is Popular
The use of mobile devices is constantly growing. It has become an indispensable part of our daily lives. Their usage is leading to steady and strong growth in mobile payment. According to the Mobile Payments in Travel & Tourism report by the World Travel and Tourism Council, transactions made by mobile payments accounted for US $450 billion in 2015, this figure reached $2.74 trillion in 2021.
The growth in mobile travel payments is aligned with the rising number of mobile payments in general. Mobile bookings accounted for 45% of total bookings from online travel agencies, 39% for smartphones, and 6% for tablets in 2017. It’s so much easier to settle your bills with the help of web and mobile payment methods. Contactless payment systems are becoming the preferred option for thousands of travelers overseas.
How to Pay When You Are Traveling Abroad: Best Tips
#1 Have a Cash-vs.-Card Strategy
How high a foreign transaction fee is and whether a traveler will be charged defines how often the person will need to utilize the credit card. Certain credit cards charge a foreign transaction fee each time a customer buys something overseas. Hence, it may be better to use local currency for snacks and coffee, and other small souvenirs rather than a credit card.
A credit card may be a more suitable payment method for more expensive things and purchases including restaurants. Set a travel alert on the credit card you take with you and take into account that certain foreign terminals might ask for a PIN.
#2 Learn About Currency Exchange Rates
It’s useful to have some local currency in your pocket before you arrive at your holiday destination. You may want to purchase the local currency of the country you are going to at the local bank before you head off. Learn about the exchange rates so that you may smart financial decisions. If you take only U.S. dollars with you, local merchants will also accept them, but the exchange rate will be higher and less affordable for you.
#3 Be Prepared before You Use an International ATM
Do some research to find out about the potential charges at international ATMs before you start using them. You may face unforeseen ATM operator access fees, ATM usage charges, as well as international transaction fees for currency conversion. Your local bank and the foreign bank may charge these fees which can certainly be quite expensive for the consumer.
If you find out the ATMs of foreign banks that partner with your local bank, you will be able to save on these costs or even avoid them at all. Make sure you know your Personal Identification Number (PIN) before you head off. You should change it in case it starts with a zero. Besides, some international ATMs don’t have letters on the keypad and support only four-digit PINs.
#4 Check Your Options for Leftover Currency
You never know how much money you will spend during your vacation or travel. The costs may add up and you can’t predict the total expenses. Sometimes, some excess cash is left at the end of the trip and people don’t know what to do with it. Of course, you shouldn’t just waste it. Instead, check your options for leftover money.
Are you willing to donate it to charity? Donation bins can be found at airports. More than that, you can apply this cash toward your hotel bill, then add the remaining sum using your credit card. Some people decide to give the leftover cash to their friends or relatives who also plan to travel. Another option is to exchange foreign cash back into U.S. dollars but try to find the most reasonable exchange rate without high fees.
#5 Use Mobile Payment Method
This is one of the easiest and fastest ways of funding your needs abroad. You don’t even need to carry any credit cards, remember your PINs, or search for reasonable currency exchange rates.
Mobile devices have become an essential part of the travel journey today. Travelers easily arrange a ride to the airport, access in-flight entertainment, get an electronic boarding pass, and unlock their hotel rooms with their mobile phones. Besides, they can conduct payments online and purchase anything they need even overseas.
The Bottom Line
Contactless payment methods have become popular since the beginning of the global pandemic. Many merchants don’t accept cash abroad so you may either take your credit card with you or pay through your mobile phone. It’s easy, fast, and convenient to use a streamlined digital process and fund your daily needs during your travel.