Next month I have a friend going away to the UK for just a few months to work on a project.
Amidst all the excitement, as this is her first trip there, she was faced with a very real dilemma.
Normally when traveling overseas on holiday or for quick business meetings she just carries cash in the correct currency for that location. Bank charges to swipe local cards overseas are quite high but she would do it once or twice if she really needed to.
If staying in a foreign country for an extended period of time, one would simply open a bank account there to avoid carrying large sums of cash, which is far from safe, and to avoid the high bank charges of swiping local South African bank cards there continuously.
My friend’s problem is that she is going for too long to carry around cash or to continue incurring the high bank charges associated with swiping her South African cards. However, she is also going for too short a time to justify the hassle of opening up a bank account in the UK.
What then would be her best option for financial management while she’s away for this mid-length period of time?
Prepaid seems like the safest, most convenient option.
The prepaid solution allows her to avoid using her South African cards, is safer than carrying around large amounts of cash, can be used for online purchases or to draw money at ATMs and doesn’t require a bank account.
She can load money onto the card using cash or her bank card. If she loads large amounts at once she won’t need to keep reloading and incurring bank card charges.
Once she has money on the prepaid card she can swipe it whenever she needs to, in replacement of her South African bank card.
Different prepaid suppliers will have different methods for loading money onto cards. Some will allow this to be done via cellphone or in store at retail partners.
Prepaid cards do carry some costs and recent reports have cautioned against the hefty charges that come with some, as there are sometimes charges for activation, swipes, and maintenance. However, if the right product is obtained, a prepaid card will work out much cheaper than using South African cards overseas.