Got a prepaid currency card for your holiday? Watch out for this fee
Prepaid currency cards have given UK holidaymakers heading overseas a ray of hope in securing better exchange rates following the volatility of the pound in the aftermath of the Brexit vote and ongoing economic uncertainty.
They are a more convenient and safer alternative to carrying cash and as you can load them up before you go abroad, travellers can lock in exchange rates when factors which could adversely impact the value of the pound are due to come into play.
See YourMoney.com’s Why you should consider a prepaid currency card for your holiday for more information.
However, if you’re not a frequent flyer and you took out a prepaid currency card especially for your summer holiday overseas, watch out for any dormancy or inactivity fee.
While Caxton FX and Revolut confirm there are no such dormancy or inactivity fees, the following providers charge when the product isn’t used for a specific amount of time:
- Cash Passport: if not used in 12 months, there’s a £2 a month fee. If following the debit of any monthly inactivity fee, the card balance is less than the fee, Cash Passport will waive the difference.
- Centtrip: an annual inactivity fee of £10 is charged.
- FairFX: fees are only applied once the prepaid card has expired and it has money left on it. The FairFX card expires after three years and card holders are charged £2 a month. Once it has a zero balance, there are no further fees.
Andrew Hagger of independent finance site, MoneyComms, said: “A prepaid currency card is safer than taking foreign currency cash, and cheaper than most debit and credit cards – just be aware that some cards charge a dormancy or inactivity fee if the card isn’t used for 12 months or more, and as it’s charged monthly, it will soon eat away at any balance remaining on your holiday plastic.”