Credit cards to use on a summer holiday

By Helen Fowler

With winter finally on its way out, many Brits are looking to sunny summer holidays with relish. Credit cards, which offer a number of protections and travel-related perks, may help you save money on your travels if you use them responsibly. credit-card-travel

They're certainly a popular travel option. Though credit cards account for only 28% of all UK plastic transactions, Brits use credit cards more often for travel than for day-to-day living, according to the UK Cards Association. Credit cards account for a hefty 44% of all card payments for travel. And with good reason.

Taking a credit card on holiday for can be a good idea. It offers the same added protection under Section 75 that you would receive at home. Section 75 means that if you use a credit card to pay for something that costs between £100 and £30,000, the credit card provider is jointly liable with the retailer for any ensuing problems. Only credit cards offer this benefit, not debit or pre-paid cards.

"You do get extra protection with a credit card, which might explain why these products remain so popular for use abroad," says Richard Purnell of the UK Cards Association.

Perks and rewards
Your card may feature other benefits, too, that are travel-specific. Some American Express travel cards offer VIP benefits such as help with travel arrangements, upgrades on hotel bookings and discounts on cruises. The American Express Platinum Cashback credit card includes travel insurance.

Others offer airport lounge access, and a number of credit cards let you earn air miles you can use for your trip.

Watch out for fees
The bad news is, if you use a credit card abroad, you may be hit with foreign transaction fees that could add as much as 3% to every transaction you make. These fees may also apply if you make a non-sterling purchase in the UK.

However, some credit cards offer low or no fees for foreign transactions. We've rounded up a few of them below:

SAGA Platinum - no European foreign usage fees. Available if you're over 50.

Nationwide Select - no foreign transaction fees on purchases abroad. You must hold a Nationwide current account to qualify for the card.

Halifax Clarity - no fees for usage anywhere in the world, including cash advances.

Capital One Platinum - no fees for purchases made in foreign currencies.

Post Office Credit Card - no fees on any purchases in foreign currencies, even when you're shopping from home, online or by phone.

See related: Four credit card problems that can ruin a holiday, Currency cards can ease money hassles abroad

Published: 6 March 2014