Planning Greek holiday? Plastic still accepted -- for now

By Marianne Curphey

As of 7 July, those travelling to Greece can still use debit and credit cards at most businesses, but, pending further talks, that could change. The best thing to do is keep cash handy, just in case.

"Clearly banks are running out of money," says Charles Purdy, chief executive officer at Smart Currency Exchange, which specialises in international payments. "At the moment, it is just smaller traders who are asking for payment in cash, but it will quickly move up the chain if things are not sorted out."

Banks in Greece are due to stay closed after the historic referendum on 5 July, in which the Greek people voted "no" to a bailout deal put forward by the country's creditors. Whether or not they reopen -- or stay closed for several more weeks to prevent a banking collapse -- depends on talks currently under way with European leaders. accepted-for-now

"Without a deal, it is hard to see how the Greek banking sector will open
for business," Salman Ahmed, global strategist and portfolio manager at Lombard Odier Investment Managers, said in a statement.

Holidaymakers mostly unaffected -- for now
A spokeswoman for the Association of British Travel Agents (ABTA) says British holidaymakers should take cash to meet their needs while they are away, but most major outlets are still accepting credit, debit and prepaid cards. Some smaller businesses, however, are asking for cash payments.

"We have had some reports that petrol stations are asking for cash as payment," she says. "However, UK credit and debit cards are still being accepted in most places and there are no restrictions on cash withdrawals at ATMs. We have had reports of long waits at ATMs in Athens to withdraw money, but this is not the case in tourist resorts. Some ATMs have not been replenished, though, and so we would advise people to take cash."

She also said holidaymakers are not currently subject to the daily cap of 60 Euros imposed on Greek residents (though if your card issuer imposes a limit, it is, of course, still in effect).

However, the Foreign and Commonwealth Office (FCO) states on its website that all of this could change at any time: "Visitors to Greece should be aware of the possibility that banking services, including credit card processing and servicing of ATMs, throughout Greece could potentially become limited at short notice."

The situation is dynamic, and there are some suggestions that the entire Greek banking system will fail. If that happens, card transactions -- including credit, debit and prepaid cards -- likely will be affected.

"We are in unchartered territory," says Purdy. He and the FCO recommend Britons travelling to Greece to be sure to take enough euros in cash "to cover the duration of their stay, emergencies, unforeseen circumstances and any unexpected delays". Travellers' cheques are not recommended, since banks are closed. ABTA's spokeswoman says holidaymakers should check how much cash their travel insurance policy covers -- many travellers' insurance policies cover loss of cash up to £300, but many UK insurers have increased that limit for those travelling to or already in Greece. For instance, Aviva now covers up to £600 per adult going to Greece until September 2015, double the usual limit.

See related: Fraud more likely to occur with travel purchases; Using plastic to get cash abroad

Published: 7 July 2015