pre-paying credit card for foreign use

goalhanger

Hello , 1st question on here.
Am thinking of getting Abbey Zero card for travel to Crete this summer . Are there any issues with loading the card up before you go to avoid high interest rates on the amount you withdraw ?

Thanks,

Moggles_2

goalhanger wrote: »

Am thinking of getting the Abbey Zero card for travel to Crete this summer . Are there any issues with loading the card up before you go to avoid high interest rates on the amount you withdraw ?

Credit cards are not designed to carry a positive balance. Modest amounts that arise temporarily (due to a refund, for instance, or making a one-off manual payment too close to your dd payment date) are okay, but the Ts & Cs usually prohibit payments that deliberately place the account in credit.

An horrendous story was posted on this board last year involving a honeymooner who had topped up his/her Halifax card to increase their spending power whilst abroad. Within days the Hally had locked their card and nobody was prepared to reverse the decision. Needless to say, their honeymoon in the USA was ruined.

Milarky

goalhanger wrote: »

Am thinking of getting Abbey Zero card for travel to Crete this summer . Are there any issues with loading the card up before you go to avoid high interest rates on the amount you withdraw ?

As the Zero card has no charges for transactions - and is 0% on purchases for the first six months you should be able to use it abroad and just make minimum payments without pre-loading it anyway..

Card Summary

lisyloo

Yes there is an issue with some cards (may not apply to all).
Nationwide (for one) do not insure credit balances so if YOUR money is stolen or used fraudulently then their insurance will not cover you and you will lose your money.
Nationwide insure THEIR money (debit balances) so if your card is used fradulently and you haven't been negligent then you are OK.

I would try to find another way, such as Nationwide debit card, there is no interest on that.

lisyloo

Needless to say, their honeymoon in the USA was ruined.

Why was it ruined?
Did they take no other cards?
No insurance?
Could they not phone the embassy/consultate?

I would always advise taking more than one card and of course being insured.

lisyloo

As the Zero card has no charges for transactions - and is 0% on purchases

The OP mentioned the word withdraw which I think refers to withdrawing cash.
I'm not familiar with the Zero card but mostly credit cards charge interesst for cash and sometimes a fee as well (and the local ATM may charge a fee on top of your bank).

A debit card (like Nationwide) charges no fee, no interest and no commission.
Sometimes there is a local ATM fee (we found this in the US) but this is not a bank charge it's charged by whoever provide the lcoal ATM and in some countries it's very hard to avoid. In the US it was about $3 (£1.50).

Rabiddog_2

Sounds right sensible to me.. Despite the nay-sayers (CC stool-pidgeons?) If its allowable, Do it!. Obviously with everyone being much more careful with their money this is the one avenue left for the CC companys to still rip people off, so they are desperate to keep this open. Otherwise nationwide debit card sounds like a good deal.

lisyloo

Despite the nay-sayers (CC stool-pidgeons?)

I am not against taking advantage of loop holes at all.
Just warning that if you are unlucky you could lose all your money.
Seems like a significant risk to save a few quid to me.

Another alternative is to pay off the credit card immediately you get back or from the internet whilst on holiday. This won't avoid interest completely but if it's a small period then interest will be minimal.
You could even set up a BACS payment in advance before you go, so you don't have to worry about it on holiday.
You don't have to wait to get your statement to make a payment and interest will be calcaulated from withdrawal to being paid off, so you could set up a BACs payment to arrive the day you withdraw (BACS take 3-4 working days to arrive).

YorkshireBoy

lisyloo wrote: »

Why was it ruined?
Did they take no other cards?
No insurance?
Could they not phone the embassy/consultate?

I would always advise taking more than one card and of course being insured.

http://forums.moneysavingexpert.com/showthread.html?t=528883

NickX

lisyloo wrote: »

The OP mentioned the word withdraw which I think refers to withdrawing cash.
I'm not familiar with the Zero card but mostly credit cards charge interesst for cash and sometimes a fee as well (and the local ATM may charge a fee on top of your bank).

Abbey Zero does not charge a fee and I believe the OP is talking about pre-loading the card into positive balance to avoid being charged interest.

It would work provided the positive balance is allowed - I would advise checking with Abbey before going along this route to avoid the problems that others have suggested.

lisyloo

Thanks for the link on the honeymooners.
I think they have to take some responsibility for their situation.

If I was doing something like this I would certainly.

a) Check the clearance times of any transfer I was doing.
b) Take more than one card
c) I always tell my card company where I'm going so my card doesn't get flagged as fraud just because i'm using it abroad. Then they have it in the notes from me.
d) I always take travel insurance with me with emergency facilities. I carry the emergency number with me and have a copy of the policy in my hand luggage.

I've never had any problems.
It does sound like they didn't get the best of treatment, but they didn't give themselves any alternatives and the worst thing was not checking the transfer time up front.