Anyone gearing up for a long-awaited international trip may be wondering about prepaid travel cards. My last overseas trip was in the hazy mist of pre-pandemic times, and I’ve been reviewing multi-currency cards before heading overseas again.
These are debit cards that can be loaded with New Zealand dollars andconverted to overseas currency for spending. They should, in theory, be cheaper than using your EFTPOS, debit or credit cards overseas, which usually add a fee of 1 per cent or more to every cent you spend.
The main travel cards available in New Zealand are the Wise Debit Card, Travelex Money Card, Air New Zealand OneSmart, Mastercard CashPassport and Westpac Global Currency Card. In the next few weeks UK app Revolut says it is also doing a soft launch of a multi-currency debit card, and its banking-style app.
I see a lot of shockingly bad peer-to-peer advice about travel cards (and cash) on social media, fuelled by smoke and mirrors from the card providers. The providers often make a song and dance about having no fees, but make their money on poor exchange rates. Or they have both poor exchange rates and tricky fees such as $4 a month “inactivity fee” if you’re not using the card.
When MoneyHub founder Christopher Walsh undertook an independent review of these cards last month he concluded that only one was worth having: Wise. When I dug deep in the past into fees and exchange rates, that has been my conclusion as well.
Walsh didn’t mince his words: “We don’t believe there is a ‘runner up’ as none of the other four cards available in New Zealand competes on exchange rates, fees or features ... nothing else [comes] a close second.”
It’s likely that Revolut could become that runner-up if it proves competitive here. Revolut offers a travel card similar to Wise’s. The charging structure is quite different, so the “best” may depend on how you spend. If you like to withdraw cash overseas, then it might be worth having both, because each limits the number/amount of fee-free withdrawals.
As well as the travel card, the Revolut app has budgeting tools built in. That could be useful on a trip where you want or need to budget your expenses. If you’re travelling with friends, the “group bills” feature can divvy up all costs at the end of a trip in New Zealand dollars, no matter how many currencies you’ve used.
Don't let spending money be a stress while on holiday. Photo / 123rf
I have to say that there is a “but” in my mind about overseas-based entities, such as Wise or Revolut. I managed to do something spectacularly stupid when using Wise by typing in an incorrect digit for my niece’s bank account. The ASB, where I’d sent the $200 from, said: “Sorry, nothing we can do because it’s a foreign bank.” The bank didn’t even offer to do a trace. And the contact centre staff member at Wise said she couldn’t help either. I pulled the “journalist” card and my money was returned a few days later by Wise from the suspense account where it was languishing.
Both Wise and Revolut belong to independent disputes resolution service Financial Services Complaints Limited (FSCL) and have to abide by its decisions. I spoke with FSCL’s Financial Ombudsman Susan Taylor this week. She said that her staff can help with complaints as simple as: I can’t get hold of a human to help me. I wish I’d known that when I had my Wise panic.
“That’s something our early assistance team can help with,” says Taylor. “They will send an email off to the complaints contact person (at the provider). Usually, once they hear from us, they sort it out pretty quickly.”
Taylor says the most common complaint is about exactly what I did. Making a payment to the wrong account. There is no guarantee you’ll get the money back, because you or I made the payment without checking, although the money services will try to help, she says.
It’s much the same if you make a mistaken payment from your bank account, says Banking Ombudsman Nicola Sladden. New Zealand banks don’t match the account number to a name and fire back a warning if they don’t match, as banks in many other countries do.
