Travellers Cheques, Cash or ATMs

[Guest]

This is a real newbie question but is it easy to change travellers cheques at a reasonable rate in the main centres or is it easier to pay the rip-off ATM fees UK banks charge?

[stogie bear]

I've heard that until recently the Nationwide ATM card was the travellers choice  but that has now changed.

Cash exchange rates in Bangkok are pretty good if you don't mind travelling with cash.

But to answer your question... It IS easy to exchange travellers checks but buy in the highest denominations you can.

[stogie bear]

Travel Money ~ A traveller's guide to managing your money...

When preparing to relocate or travel overseas, managing your money is usually the last item on a very long 'to do list'. However, it is worth considering the many options to avoid being stung by potentially hefty foreign ATM/cash point machine fees, credit card interest rate fees and expensive exchange rates. In this post we look at cost, security and convenience;

>>>>>>>> Convenience Factor ~ Cost Factor ~ Security Factor
Cash... Medium ~ Medium to High ~ Medium
Debit Cards Overseas... Medium to High ~ High ~ Medium to High
Local Debit Cards... High ~ Low ~ High
Credit Cards Overseas... High ~ Medium to High ~ High
Pre-paid travel cards... High ~ Medium to High ~ High
Traveller's cheques... Low to Medium ~ Low ~ High

MINIMUM recommended: You should have access to cash through at least one option and have at least one other (plastic) option for paying for larger purchases through a separate account and card.

Your travel money options:
Cash
It is always advisable to enter a country with at least a small amount of local currency on you although this might be hard to get if your destination is Thailand. But don't worry - the booths (some of them) are open round the clock at the airport. You don't want to be stranded without foreign currency to cover small airport associated costs such as taxis, bus fares or limo. The down side is that you usually pay for the convenience in both the exchange rate and there is often a minimum charge.

Debit cards - overseas
Convenience costs and although using your debit card at overseas ATMs/cash point machines is definitely easier than organising foreign money exchange or traveller€™s cheques; it is also much more expensive.

Bank fees charged for using foreign ATMs/cash point machines are much higher than at home and the exact amount often goes unnoticed until you return from your holiday or receive your next bank statement. Warnings now pop up on most UK cash point machines stating that additional transaction charges from the home financial institution will apply, but the exact amount is rarely shown.

In addition to your bank at home charging you, a charge is applied to transactions at foreign ATM/cash point machines. This charge is known as the €˜loading fee€™, levied as a 2.75% commission on the total cost of your credit or debit card transaction. Providers refer to it as an €˜exchange rate administration fee€™. When cash is withdrawn from foreign ATMs/cash point machines an additional charge is applied. This is levied by the card issuer and averages at 2% for credit cards and 1.5% for debit cards. Nationwide, Saga and Liverpool Victoria are among the providers that do not apply a loading fee, so if you are in the UK keep your eyes peeled for these cash point machines.

In addition, many overseas retailers now give customers the choice of paying in their home currency or the local currency. If you opt with the home currency, a dynamic currency conversion fee will be applied which is typically 4% of the total.

Local debit cards
This is the best option for long term stays in a local country, both in terms of convenience and cost.

For expatriates looking to set up a bank account in the UK to avoid exchange rate administration fees and foreign ATM / cash point machine transaction fees, visit the WORKgateways page on opening a UK bank account.

If you are simply travelling through a country, Credit Cards are often an excellent option.

Credit cards €“ overseas (including Travel Reward Credit Cards)
There is no denying it, using a credit card when travelling is not only a convenient option but it also has some perks which appeal to any traveller;

Credit
Relatively low cost
Travel reward Credit Cards/points
Cash advances (Warning: You usually do not get any interest free period)
Credit cards like Visa and Mastercard often only charge the interbank exchange rate plus a standard 1%. Some banks also charge an additional surcharge for on purchases made in a foreign currency. This charge may not exist, although it is a good idea to find out what the issuing bank or credit union of your card charges. (Some banks are charging as high as 4% !!)

In general a Credit Card in the right hands can be an excellent tool in your travels, particularly if you pay it off every month. Apart from costs, some cards have travel insurance, cash back, online fraud guarantees and travel rewards so choose wisely!

Pre-paid travel cards
Now there is another option available for travellers who are sceptical about using their debit or credit card in foreign countries. Especially designed for travellers, specifically traveller€™s under the age of 30, pre-paid travel cards are pre-loaded with funds before you leave home meaning there is no chance of over drawing money and therefore being stung with excessive interest fees. Apart from that, pre-paid travel cards operate in much the same way as a regular debit/credit card and can be used to purchase goods (with all the usual foreign transaction fees), from retailers and to withdraw money from ATMs/cash point machines. If you have funds left on your card at the end of your travels, you can choose to keep them on your card and top them up the next time you travel, or alternatively, withdraw the remaining cash from an ATM/cash point machine. The only negative is, like any bank or credit card, if your card is stolen or lost it can take days to replace. So it is a good idea to have a back up source of travel money.

At present the Visa prepaid card €“ €œVisa Travelmoney€ seems to be the only option. For a full list of the pre-paid travel cards available from Visa, visit the official Visa website. Make sure you are aware of the transaction fees associated with each card before signing up.

Traveller€™s cheques
A traveller€™s cheque is a pre-printed, fixed amount cheque that requires a signature to pay for a good or service. In general, traveller€™s cheques are an outdated and tiring form of travel money as traveller€™s cheques are no longer as widely accepted by retailers and take some time to organize. However, traveller€™s cheques do still have some benefits for the safety conscious.

Unlike cash, traveller€™s cheques can usually be replaced by the issuing bank or financial institution if lost or stolen, and they never expire. They work on the basis that the purchaser is essentially giving an interest free loan to the issuer. This is how the issuer makes their profit, as these days most traveller€™s cheques are commission free or charge a mere 1% commission on the total. It sounds appealing in light of the foreign credit and debit card transaction fees, but the hard truth is that traveller€™s cheques are rarely accepted by retailers. Instead, holders of traveller€™s cheques must visit a bank or bureau de change to exchange the cheque for local currency. This also requires the holder to carry an additional form of identification, such as a passport or driver€™s licence, with them at all times for verification.

Travel money tips
Before you leave home, make sure you have completed the following travel money checklist€¦

You are aware of the current conversion rate. Learn about exchange rates
You have checked the amount left in your debit card or have checked what your credit card limit is.
You have checked to see when your credit or debit card expires so that your cards remain valid the entire time you are away.
You are aware of the hidden costs and foreign ATM/cash point machine fees charged by your bank or card issuer.
You plan to pay off credit card cash withdrawals as soon as possible as there is usually no interest free periods and a higher rate of interest charged on these types of transactions.
You are aware of the practice of dynamic currency conversion used by many retailers.
You have at least two different sources of funds available at all times in case one of these fails on you.
You have visited your credit card issuer€™s website and followed the link to the €˜international ATM locator€™ to check you will be able to withdraw funds from the country you are traveling to before you leave home. This is especially useful when traveling to remote or third world countries.
You have made separate records of your card or traveller€™s cheques and have left these details at home or in a very safe place in case your travel credit or debit cards are lost, damaged or stolen. The quickest way to do this is to photocopy the front and back of your cards to ensure you have all details, including the security numbers on the back of most credit cards. This will assist you in replacing your cards quickly.
You have visited your bank branch to request a copy of your statements for the last three months and a reference letter confirming your banking history and status as a customer of their institution. This will assist you with setting up a bank account if you are relocating to another country and may be required when entering countries such as the UK on a working holiday visa to prove that you can financially support yourself.

Copied and edited from a travel site...

[Dieter]

Cash...off course...girls don't accept CC's...
Euros are very welcome... Dollar(bucks) use as shit-paper or??

Dieter

[katoeylover]

I always use Travellers cheques in high denominations (£100+)

very easy to change at all outlets but you need your passport, so usually change a few at a time and keep the cash in the hotel safe

[PigDogg]

(stogie bear @ Sep. 20 2007,14:09) It IS easy to exchange travellers checks but buy in the highest denominations you can.

The reason for this is that most Thai exchange booths charge a 33 baht fee per traveler check.

The exchange rate is better for travelers checks than cash.  

If you're from the USA and IF you can get $500 TCs without the commision this is clearly your best bet.
You'll get a reasonably good exchnge rate and only a 33 baht fee when cashing.

I also bring both a credit card and a debit card for backup.

With USD you get a better rate on your CASH if you bring 100's. But make sure they're NEW 100's.

[moe666]

I use to bring travelers checks but the fees are crazy and if you get ripped off they may be no better than cash. If you were not protecting them, left bag lying about and they are stolen they can refuse to replace them.
Cash is king but put what you do not need in safety deposit box at hotel.

[Snick]

I prefer an ATM, IF they don't charge fees.
I have 3 atm cards
one charges 3%, I avoid that one
one charges a flat $4 fee, I use that if I am get 10,000 or 20,000 Baht
one doesn't charge anything, limit 4 times per month -- I use this one

Problem is finding out what the charges are before you get here.

For traveller's checks - cash them early and walk around with cash

Be wary of using your credit card, their have been many instances of cloning (making a copy of your card). I would limit my CC use to top hotels in Bangkok and not use it in stores,restaurants or Pattaya hotels

[haze69uk]

Where is the best place to change us$ into baht in the Sukhumvt area?

[69billy]

(stogie bear @ Sep. 20 2007,23:09) I've heard that until recently the Nationwide ATM card was the travellers choice but that has now changed.

SB..
I just got off the phon talking to Natonwide.. Using there flexaccount at ATMs is still free..

[jadeite]

I use a ATM card exclusively because it carries every advantage:

1. best exchange rate. that's what it comes down to after all.
2. my ATM has no fee. My bank charges an upfront 2.5% to issue TC's, then they get a worse exchange rate, and then you get dinged a 3rd time with the new 30+ baht per $100 surcharge to exchange them. Try to cash a $500 note and they charge you the surcharge 5 times.
3. easier to find a ATM machine than a money changer by over a 100:1 margin
4. ATMs are open 24/7, 365 days a year. most changers close up at 6pm
5. no paperwork to buy them
6. no paperwork to exchange them
7. no waiting in lines
8. no dealing with having too many or too few
9. probably some other stuff

[Guest]

(jadeite @ Sep. 22 2007,03:38) I use a ATM card exclusively because it carries every advantage:

1. best exchange rate. that's what it comes down to after all.
2. my ATM has no fee. My bank charges an upfront 2.5% to issue TC's, then they get a worse exchange rate, and then you get dinged a 3rd time with the new 30+ baht per $100 surcharge to exchange them. Try to cash a $500 note and they charge you the surcharge 5 times.
3. easier to find a ATM machine than a money changer by over a 100:1 margin
4. ATMs are open 24/7, 365 days a year. most changers close up at 6pm
5. no paperwork to buy them
6. no paperwork to exchange them
7. no waiting in lines
8. no dealing with having too many or too few
9. probably some other stuff

I am the same only ever use ATM except for the occasional credit card purchase. I actually think travellers cheques are not as useful as they once were. In countries where ATMS are abundant you will normally get a better exchange rate at the ATM. Of course there are usually fees but talk to your bank I did and now I do not get charged.

[stogie bear]

Best advice for Brits travelling abroad...

Thanks Billy for the update on the Nationwide ATM status...

[Road Runner]

(stogie bear @ Sep. 20 2007,21:09) I've heard that until recently the Nationwide ATM card was the travellers choice  but that has now changed.

I was wondering about this!  

I got home from LOS only 18 days ago and Nationwide had changed nothing up to that time.

Up to now I have not found any other UK credit or debit card (other than Nationwide)  that does not sting you on exchange rates/and/or charges on foreign currency exchange rates.

I would dispute Stogie's comment about arriving with some Thai Baht!   I never do!
I always show up with £200 and change it at the airport.  Why?  because if I change it in the UK I get about 65 Baht/£1 - at the airport in Bangkok I get 67 Baht/£1.

I talked to someone a couple of years ago about travellers cheques.  As Jadeite says you lose on the exchange rate. Also you get a tax from the Thai government of 33 Baht/cheque.
I understand that this breaches the international banking agreements!
But I would always say to take some travellers cheques to cover you for a couple of days spending.
Why?  Because if your ATM cards go missing it will at least allow you to eat!

Note also that it's standard practice to ask for ID when you exchange money in most countries.

RR.

[rxpharm]

RR, SB was just being a bit too efficient when he copied and pasted that info from a travel information website! I agree that it is not a good idea to change any currency to Thai Baht before arrival - the rates in your home country will be less than what the LOS offers on arrival.

I used to use traveler's checks a lot - the banks here in the Middle East don't charge as much % as the western banks do, but I have found the ATM card to be just as easy and convenient.

One problem I did run into when I was working in Saudi Arabia, some of the money exchange booths would not cash the VISA traveler's cheque from a Saudi Bank - not sure why at the time, but later I heard that particular bank were late in redemption of the traveler's cheques to the money exchanges.

Fortunately I am not working there anymore!

There are money exchange booths in all the major tourist areas - the rates will be quite similar in all of them. On arrival at the airport there are also several money exchange booths in the arrivals hall - a good place to change some money to pay for taxi, etc.