There was a time when a traveler had to carry a lot of cash or travelers checks across borders. There are and remain a lot of hassles with carrying cash or even travelers checks to this day. But each instrument of finance have their own benefits and draw backs. We shall now talk about the benefits of credit cards for the overseas traveler.
- The most obvious benefit for a credit card holder when making transactions overseas is that he or she does not have to worry about local currency. Getting acquainted with the local currency can always be a challenge for anybody, but with a credit card one does not have to worry about any of this. All you have to do is swipe away and worry about the exchange rate later.
- Talking about exchange rates, many banks will offer competitive exchange rates when you make transactions on a credit card issued in America. The credit card is dollar based but your transactions could be in renminbi for all the bank cares. You will get a good exchange rate on your card if you have been with the bank for a couple of years.
- Security issues. There are a number of security issues when travelling with a large amount of cash. It is okay if you are going to a developed part of the world where law and order is a given. But if you are going to a third world country, you can never say when what might happen. And you really cannot trust the local law enforcement to do much for you in the event of such an incident.
- Loss of your cash makes it irreplaceable. But loss of your card will just mean that you will have to dial the toll free number and cancel it. If you own a gold or platinum class card, you can always get it mailed to you within a few business days.
- The other benefit of a credit card is in emergencies. If you are in a foreign country with just a fixed amount of cash for your vacation, it will help you budget your travel expenses. This is true. But if you are faced with an emergency situation where you need extra cash, you cannot rely on anyone locally to bail you out. In such situations, it always helps to have a credit card which can carry a huge credit limit and help you out in times of need.