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Woodentop

Money cards

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Posted (edited)

For anyone out there that goes abroad and takes a loaded money card with them, you should listen to today's (6th July) edition of Moneybox on BBC R4. It is repeated on BBC R4 at 21:00 Sunday 7th July or can be heard again on BBC Sounds for 30 days.

 

The idea with these cards - a sort of inverse credit card - is that you put money on it before you travel and then when you withdraw it overseas (usually in this instance within Europe) from a cash dispenser you are not charged fees as you would be with your bank debit card. AIUI you will pay once to load it and change it into Euros at the same time.

 

One woman told her story - that she went to withdraw €150 from an ATM and only after entering the sum did she find out that the ATM would charge her. She cancelled the transaction. She went to another ATM and the same thing happened so again she cancelled. The third ATM didn't charge but when she entered the sum required it transpired that the first two machines had each ring-fenced the requested €300 so there was insufficient funds to use on the holiday. Fortunately she had alternative means of finance, especially as it was  a month after she returned home before she got her money back.

 

Be aware......

 

Edited by Woodentop

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I listened to the broadcast and was also concerned at some of the experiences that were described. I thought the lady defending the industry position had her work cut and I was less than convinced by some of her answers. 

 

There appeared to be two types of problems firstly the charges associated with using the cards and secondly the reliability of just where the cards would or would not work. 

 

It appeared that determining where the cards would or wouldn't work was unpredictable and not something that could be determined by research which was a bit alarming. The matter of charges was something that could be calculated in advance by looking at the t&c's small print but it seemed that there was a charge associated with almost every transaction (both placing money on the card and using it or even reclaiming an unused balance) making the card expensive to use. 

 

Personal experience is that one of our daughters used a pre-paid card while travelling in the USA a couple of years ago. She didn't have a credit card at the time and the prepaid card appeared to offer security. We fully understood that this came with a cost but in the circumstances we knew what we were getting into and accepted it. Also to be completely fair she did not experience any problem using it. However, that is at odds with other people's experience so does add to the unpredictability argument. 

 

In certain circumstances these cards have their uses, but you have to do the research to know exactly what you are getting into. They can provide convenience, but it comes at a price. 

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10 hours ago, Woodentop said:

For anyone out there that goes abroad and takes a loaded money card with them, you should listen to today's (6th July) edition of Moneybox on BBC R4. It is repeated on BBC R4 at 21:00 Sunday 7th July or can be heard again on BBC Sounds for 30 days.

 

The idea with these cards - a sort of inverse credit card - is that you put money on it before you travel and then when you withdraw it overseas (usually in this instance within Europe) from a cash dispenser you are not charged fees as you would be with your bank debit card. AIUI you will pay once to load it and change it into Euros at the same time.

 

One woman told her story - that she went to withdraw €150 from an ATM and only after entering the sum did she find out that the ATM would charge her. She cancelled the transaction. She went to another ATM and the same thing happened so again she cancelled. The third ATM didn't charge but when she entered the sum required it transpired that the first two machines had each ring-fenced the requested €300 so there was insufficient funds to use on the holiday. Fortunately she had alternative means of finance, especially as it was  a month after she returned home before she got her money back.

 

Be aware......

 

Similar can happen when a hotel takes a a card at check in and they claim a sum which you may not spend 

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I looked at the travel money card from the Post Office.

 

Initially it seemed like a good idea, but the fees put me off.

 

Monthly maintenance fee (only charged 12 months after card has expired) £2 per month.

Please note, a 3% cross border fee applies when you spend in a currency other than one of the 13 currencies we offer.

For Pound Sterling there is a load commission of 1.5% (min £3, max £50).

 

From my understanding, it costs nothing to put money on the card and nothing to spend on it, just like a normal credit card, as long as you are spending in one of the 13 currencies listed.

 

You can use it in the UK, but there is a 1.5% charge (min £3, max £50) for spending in Pounds. 

 

The bit that put me off was the  £2 Monthly maintenance fee, a year after the card expires and there is a charge to cancel the card.

 

Withdrawing cash from an ATM would also incur a charge, just like using a credit card to do so.

 

So, initially it seems like a good idea, from a security viewpoint, but could work out costly if you stop using it and forget to cancel it.

 

Q & As

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Daughter no 1 has just invested in a Monzo account for our forthcoming holiday in Australia. I did warn her about possible pitfalls  and I'll copy this advice to her. 

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My Halifax Clarity and Nationwide credit cards have so far worked well in 19 different currencies.  No pre loading money . No currency conversion fees.  Spend now, pay at the end of the month.  You should see the jewellery my wife bought in Sri Lanka! 

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On a similar vein, Direct Debits arranged with a credit or debit card continue to be honoured even after the card expires!  I thought my magazine subscriptions would expire when I my card expired but not so.

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I agree with Moorgate - I can't see the point in these pre-loaded cards at all. I have Clarity, Nationwide and Santander Zero and between these have never paid to withdraw money, have always had the current inter-bank rate (ie the best available), and even when I've used the Clarity card for cash withdrawals have never paid more than a few pence in interest charges - usually nothing at all.

 

I don't buy the security argument - if your card is goes missing then once you inform the issuer you're covered. And we all have their numbers in our mobile phones and elsewhere for safety don't we?

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If you buy a prepaid card in Dollars or Euros, you know up front what commission you've paid.  After that, the Dollar or Euro payments are commission free.  (ATMs abroad may charge all users, as do some UK ATMs in shops etc.)  The other attraction is that you limit any losses.  Imagine if you mislay or lose a card but don't realise for a day or two.  Those losses on a normal card are not covered.  Can also be handy if your card is declined or your bank puts a security hold on it as has happened to me.

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We use the Post Office prepaid cards,there is a €1.50 fee for atm use but not on purchases. We used to use our bank debit cards in atm but the fees are too high.

We use a credit card for card filling stations and autoroute tolls. There are plenty of cards with no overseas charges.

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1 hour ago, iansoady said:

  .... I agree with Moorgate - I can't see the point in these pre-loaded cards at all.....

 

I also agree with you and Moorgate about Clarity and Nationwide, we too have both. 

 

However, I think you're missing the point, they are credits cards, there are many and various reasons why some people don't want, or can't/don't have access to credit cards. That is who pre-payment cards are aimed at. Against that background and providing you go into a pre-paid card fully aware of all the t's & c's they have a place and usefulness for some people. 

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Posted (edited)

If they don't want credit cards, they can get debit cards.  Or arrange for the monthly c/c bill to be paid by direct debit, in which case they won't pay any charges.

Edited by kelper

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Posted (edited)
1 hour ago, kelper said:

If you buy a prepaid card in Dollars or Euros, you know up front what commission you've paid.  After that, the Dollar or Euro payments are commission free.  (ATMs abroad may charge all users, as do some UK ATMs in shops etc.)  The other attraction is that you limit any losses.  Imagine if you mislay or lose a card but don't realise for a day or two.  Those losses on a normal card are not covered.  Can also be handy if your card is declined or your bank puts a security hold on it as has happened to me.

 

Yes, but with a decent credit or debit card you don't pay any commission at all - unless you're foolish enough to draw from an ATM (or make a purchase) and let it convert to £ for you.

 

TBH I always keep a very close eye on my cards everywhere but particularly overseas - not because I don't trust people but it may be difficult to report. I did once lose a wallet with cards in it in Paris (many years ago) and wasted a day reporting it to the police which in hindsight I needn't have done.

 

And if you have more than one card from different banks (3 in my case) the chances of them all being declined is minuscule. It's never happened with any of mine.

Edited by iansoady

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I have been tempted to get a FairFx money card but not yet, we use Nationwide and Halifax Clarity credit cards, what we have found that if you pop into a supermarket to fill up with diesel, no problem, but if you then go into the store to shop for groceries the card is rejected, if you went only into the store and not to fill up the card is accepted, this happens with both Nationwide and Halifax Cards, ODD !!

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That's interesting. On a couple of occasions this year we bought groceries in a supermarket (on one occasion including lots of wine to bring home) then filled up with diesel - once from an automatic pump, once via a cashier - and no issues. I was using my Nationwide Select credit card for both transactions each time.

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5 minutes ago, iansoady said:

That's interesting. On a couple of occasions this year we bought groceries in a supermarket (on one occasion including lots of wine to bring home) then filled up with diesel - once from an automatic pump, once via a cashier - and no issues. I was using my Nationwide Select credit card for both transactions each time.

Same with us Nationwide cc.

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12 minutes ago, iansoady said:

That's interesting. On a couple of occasions this year we bought groceries in a supermarket (on one occasion including lots of wine to bring home) then filled up with diesel - once from an automatic pump, once via a cashier - and no issues. I was using my Nationwide Select credit card for both transactions each time.

 We tried a FairFX  card some years ago and found it to be an utter pain to use. We ended up with an odd balance which we were unable to withdraw and gave it up as a bad job. We use our Nationwide Debit Card for cash withdrawals and the Select credit Card for purchases. as these are in use all the year round there is no special arrangement for holidays needed.

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We regularly [too regularly, usually a minimum of 5 or 6 times each week] use the Nationwide Cretin Card [Family joke for those who don't clear the balance in full each month] at either, or both of the local DIY Stores in France within 20 or so minutes of each purchase, and then a 'while we're out, we'll grab some food shopping' so visit the local supermarket, again using the cretin card.

We've never had a problem with multiple transactions being queried. Last week was slightly unusual because we were booking ferries and campsites for our return to Scotland, but in 1 day, it was Ferry Booking, 2 sets of campsite fees, DIY store for yet more paint, and a food shop in the space of about 3 hours or so.

Steve

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14 minutes ago, Ern said:

  We use our Nationwide Debit Card for cash withdrawals and the Select credit Card for purchases. as these are in use all the year round there is no special arrangement for holidays needed.

My instructions on my internet banking say otherwize.

I have to use the cards at the port or airport to buy something or check balances to alert their fraud detection system I'm about to leave the UK.

Also I can tell them dates of arrival and return on my internet banking prior to the trip if I wish.   I do this for all three cards as one never knows time might not be available use at the port or airport.

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6 minutes ago, David 38 said:

My instructions on my internet banking say otherwize.

I have to use the cards at the port or airport to buy something or check balances to alert their fraud detection system I'm about to leave the UK.

Also I can tell them dates of arrival and return on my internet banking prior to the trip if I wish.   I do this for all three cards as one never knows time might not be available use at the port or airport.

What a palaver! 

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12 minutes ago, David 38 said:

My instructions on my internet banking say otherwize.

I have to use the cards at the port or airport to buy something or check balances to alert their fraud detection system I'm about to leave the UK.

Also I can tell them dates of arrival and return on my internet banking prior to the trip if I wish.   I do this for all three cards as one never knows time might not be available use at the port or airport.

We've only once pre-advised Nationwide, and they weren't that bothered, and have never queried any purchase. I have an HSBC Account, and invariably tell them of my travel plans, especially if on a cruise [destination and date of visit]. The last occasions has resulted in transactions being queried, so now, everything goes via Nationwide. Less palaver, less aggro, more unbroken holiday mood ...

Steve

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Posted (edited)

Lloyds fraud detection is automatic and telling them I was working on a cruise ship and visiting Tahiti did not stop transactions being flagged as suspicious.  I'd then have to Talk to the bank to get them to authorise the transaction.  Very annoying when you are paying for a meal in a restaurant!

20 minutes ago, David 38 said:

I have to use the cards at the port or airport to buy something or check balances to alert their fraud detection system I'm about to leave the UK.

That's ludicrous!  A thief could be using your card at the airport.  And it doesn't inform the bank which country you are visiting!  Can you quote the actual wording of their advice, please?  I don't doubt you one bit.

Edited by kelper

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A few years ago, I did a comparison of actual rates and used a variety of bank cards within minutes of each other. The bank issued credit cards were always better than any preloaded rate.

 

The findings are dated but are here to read if you so wish.

 

Russ

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1 hour ago, David 38 said:

My instructions on my internet banking say otherwize.

I have to use the cards at the port or airport to buy something or check balances to alert their fraud detection system I'm about to leave the UK.

Also I can tell them dates of arrival and return on my internet banking prior to the trip if I wish.   I do this for all three cards as one never knows time might not be available use at the port or airport.

 

 

I've used Nationwide FlexAccount debit card and Select credit card for years and never advised them in advance ofmy many trips abroad each year.

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I always advise Nationwide. I also used the ATMs at Portsmouth to check my balance on both as advised. It may seem a palaver to some but it occupied 5 minutes of the otherwise boring wait in the queue.

 

I'd rather have a few minutes' very minor inconvenience than spend hours on the phone myself.

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