Credit card or foreign bank account for overseas purchases?

[emiaby]

Hi folks! I'll be doing some traveling later this year from May onwards, and am trying to establish the most cost effective way to spend my rands overseas. Two options have presented themselves:

1) Open overseas foreign currency account

Convert my rands to foreign currency (e.g. using Currencyfair or Shyft), and then send that foreign currency overseas to a bank account I open.

or

2) Use SA credit card

Use a South African credit card to make all my purchases overseas and let that cc provider handle the currency conversion e.g Visa or Mastercard.

Does anyone have any experience travelling and using either or both of these methods and can provide advice on which is the more cost-effective? I'll be travelling throughout the Nordic countries/South Korea/the US/the UK/Ireland. First time travelling and wanting to find out as much as I can about how to spend rands wisely overseas!

 

[augjdog]

@emiaby Use your credit card, you need a form of identification for opening bank accounts in most countries, check whichever country you are going to visit what the requirements are. You’ll pay a premium in anyway for sending and changing rands to foreign currency, why not let your bank handle it? Also credit cards come with travel insurance

 

[resjudicata]

@augjdog Yip. You will struggle to open a bank account. Just use a credit card and make peace that you’re paying 5 to 10% more.

Or convert before you go. Using a company like fxrand.co.za or one of the many others. And then just take the converted currency with you.

Dont use a bank to convert. It will cost you about 1.5% whereas other forex companies can get it below 0.5%

 

[mick7777]

@emiaby Use capitec. Cheapest

 

[susan001]

@emiaby Use Capitec Credit card, it has 0% conversion fee. Also comes with basic travel insurance. I have it linked to Apple pay and just tapped everywhere in Mauritius and Turkey. The machine will ask for local or foreign currency. Just pick local