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Free tube travel with Contactless

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London underground by doug88888

London underground by doug88888

There’s currently two deals on the London Underground to welcome their acceptance of contactless card payments in addition to the Oyster Card.

If you’ve got a contactless MasterCard or contactless American Express card, you can get some free travel simply by tapping in using your credit card rather than your Oyster…

American Express: £5 off when you spend £5

With a contactless American Express card, you can travel around London up to the value of £5. You’ll need to spend £5 in a day, as TfL charge you at the end of each day. Sign up on the Cardmember Offers website, and use your card before 30th November to get your credit

MasterCard: Free travel on Friday 14th November

If you’ve got a contactless MasterCard (remember that the Metro Bank card is a MasterCard debit card), you can get around London completely free simply by tapping in and out using your card this Friday. You don’t even need to register! Full terms available on the MasterCard website

via Londonist

American Express: Drive a car? Get £10 off a £50 at Esso

There aren’t usually that many deals on petrol, so if you drive a car, this one’s for you. Simply sign up on the Cardmember Offers website, fill up with £50 of fuel and you’ll get a £10 credit. It’ll probably work with non fuel items too, if you’ve got one nearby. Expires 24th November

Metro Bank to charge for non-EU transactions from 18th March

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If you’ve got the Metro Bank account, you’ll have received a letter informing you that they’ll be charging for using your card outside of Europe: 1.9%, plus an additional £1 fee each time you use a cash point.

To be honest, this possibly shouldn’t have come as a surprise. Visa (as does MasterCard, I believe) charge a 1% fee for handling non-EU transactions, and banks that offering 0% were simply absorbing that fee. In an age where profit margins (especially on current accounts) are being squeezed (and remember that Metro Bank is currently losing money), this was probably unsustainable.

What isn’t great is the additional charges that have been placed above and beyond the 1% fee: Metro Bank will charge 1.9% for non-EU transactions, with an additional £1 fee for using a cashpoint. Whilst this is lower than many of the other banks (they usually charge around 3%), it’s still 0.9% above and beyond what they’re getting charged by MasterCard.

What’s your alternative?

Norwich and Peterborough are still offering a current account that offers free overseas usage, but they come with usage rules or a monthly fee of £5 applies. You’ll need to:

  • Pay in £500 a month, and:
  • Either make at least five transactions a month (you may be able to cycle money through there using standing orders), or keep a balance of £5000 in your account (this really isn’t worth it, as it’s a non-interest bearing account. If you kept it in a Lloyds Vantage or Santander 123 account at 3%, you’d be earning £10 a month after 20% tax)

Interestingly, their “light” account where you wouldn’t have to pay in the £500 monthly is being withdrawn from tomorrow – I wonder whether this is in response to Metro Bank’s new charges.

Personally, I’m lucky to still have the Santander Zero Current account, which is unfortunately closed to new customers, but the future of that account is probably also in question too.

This really isn’t great news if you’re travelling outside Europe after 18 March. It’ll probably be cheapest to purchase travel money in advance of going abroad (try TravelMoneyMax from MSE for a comparison – usually the best rate is by prebooked your currency exchange and picking it up in London), and try to keep spending to one of the credit cards that offer better rates.

Foreign Spending – Credit, Debit, Cash, Prepaid or Travellers Cheque

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If you’re going abroad, you’ll need to have some spending money to spend on those all important essentials. Most cards will charge you a percentage to use them abroad, whilst others charge a flat fee – and some even charge both! These are my top picks of the cards you’ll want in your wallet when you’re travelling overseas.

When you use a card overseas, you’ll be paying a Visa/Mastercard interbank exchange rate, rather than the tourist one. For a card with fees, you’ll probably pay a comparable rate to one at a bureau de change, but if you use one of the cards recommended in this article, you’ll get an unbeatable exchange rate.

It’s also important to note that you should never accept “Direct Currency Conversion” – this is when the foreign retailer or cash machine offers to charge you in pounds – this always has a fee, which is easily beaten by your card.

Halifax Clarity Rewards Card

This is my favourite card for foreign spending – and one that I use on a day-to-day basis for  merchants that don’t accept American Express. With this card, you get both no fees for foreign purchases, as well as £5 cashback when you spend £300 a month.

Note that you will need a Halifax Rewards Current account to apply for this – but this is a great deal too. Simply pay in £1,000 a month, and you’ll get £5. You don’t even need to keep the money in the account.

You’ll need to go into branch to open this credit card, but if you just want the 0% foreign spending with no cashback, you can apply online.

Metro Bank Debit Card – now for Europe only

You should never be taking money out on your credit card, even if there is no cash withdrawal fee – you’ll be charged interest from the day you take out the cash, even if you pay off your statement balance on time – there’s no float period on cash.

The Metro Bank Debit Card is the best card to use in Europe – it won’t charge you fees for making the cash withdrawal. Just make sure to top up your account before leaving the country.

You’ll need to get to one of their branches in London to get this account, but they’ll make it up for you on the spot in the branch – useful if you’re travelling abroad soon.

Alternatively, try the Norwich & Peterborough Gold (Classic) Current Account (although, please note the funding and activity requirements) – this also offers free card usage abroad, and you can apply online. I haven’t tried this account though.

Cash

You should probably carry a bit of cash with you before you go: if you’re using Euros, there’s a euro denominated cash machine at the NatWest headquarters in Bishopsgate, which you can use your Metro bank debit card with.

Otherwise, try TravelMoneyMax to see the best exchange rates – it’s often at the Thomas Exchange Global stand in the Liverpool Street arcade.

It pays to plan ahead – you’ll get the worst rate at the airport, and you’ll get a slightly better rate at many of the bureau de changes if you book online first.

Prepaid Cards

I don’t recommend Prepaid cards – they don’t really have any advantages over a 0% debit/credit card, and there’s often a bunch of additional fees as well.

Travellers Cheques

Travellers Cheques have an advantage over cash, since they can be replaced if lost, but it’s often difficult to cash them in at your destination. Additionally, there’s a worse exchange rate than cash at the bureau de change, because the fees have to be built in.

Credit Cards – ten reasons to switch from cash

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There’s the old adage that “cash is king”, but when it comes to paying for things, as a consumer, it’s much better to pay by credit cards. You’ve got to ensure you’re using them wisely by spending within your means, and make sure you set up a direct debit to pay off the full statement balance each month (and you ensure you’ve got the money in your bank account to pay off your direct debit!).

Here’s ten good reasons to pay by credit card:

1. You get rewards for paying by a cashback/rewards card

There’s a bunch of different reward offers around which give you a credit for simply using the card for your day-to-day transactions: if you’re a member of a frequent flyer/hotel loyalty program, it can be useful to boost your miles or points.

Alternatively, you can earn cashback, usually around 1-1.25%, depending on the card. Watch out for annual fees though, as these will eat into your cashback if you don’t spend enough to make it worthwhile.

2. You have protection if the merchant doesn’t deliver

With a credit card, you have protection in law under Section 75 of the Consumer Credit Act, which makes the credit card company jointly liable with the retailer for transactions over £100 if the company you buy from doesn’t deliver. In practice, this is done through a chargeback through your credit card provider – they will investigate your claim, and then retrieve the money from the merchant’s bank, who will then debit their account, along with a handling fee.

If you’re using a debit card, you should be able to do a chargeback, but this isn’t enshrined in law.

On the other hand, if you’ve paid by cash or cheque, you’ll have to take it up with the merchant and hope you get your money back.

3. You get a record of where you’re spending your money

Your online statement is a great way to work our where you spent your money – it’s unlikely that you’re keeping a record of where you are spending all those cash withdrawals, right?

4. You’ll build your credit rating

Paying off your credit card on time helps to build your credit rating – this shows lenders that you’re a good credit risk, and should help you get credit in the future.

5. You get a ‘float’ period

You get up to around two months interest free credit. This is the period in between spending on the card, receiving the bill, and the money coming out through the direct debit. You can earn interest on this money if you’re using a top current account, like the Santander 123 Current Account.

6. If you’re spending overseas using a 0% fee card, you’ll get an unbeatable exchange rate

See more information about this in my Foreign Spending blog post

 

There are currently a number of cards that allow you to do this – both credit and debit, such as the Halifax Clarity Credit Card, or a Metro Bank Debit Card.

The benefit of using these cards abroad is that you’ll benefit from the interbank exchange rate, rather than the tourist one which is always a couple of points in their favour. Just watch out for dynamic currency conversion – this is when the machine will ask if you want to pay in Pounds rather than the foreign currency: you should always reject this offer.

7. Contactless is faster than cash

It’s a lot easier to pay by contactless than it is to by cash – you don’t need to fumble with change. In London, it’s accepted at a load of retailers – mainly chains, but they’re starting to roll it out. Plus it’s now cheaper to use your contactless card on the bus than paying by cash if you forget your Oyster.

8. You can occasionally get exclusive rewards and offers

If you’ve looked at my blog recently, you’ll have seen the multitude of offers that have been available for American Express card holders – whilst this isn’t a guarantee that they’ll come back again, there’s usually an offer or two about.

9. If you’re defrauded, there won’t be a hold on your funds

In the unlikely event that you do get defrauded, it’s the credit card company’s funds – if you were using a debit card, there’s the possibility that you could be without cash.

10. If you lose your card, you can get a free replacement

If you lose your cash, it’s gone – lose your card, and you’ll get a free replacement: and some card companies will even courier you a temporary card if you’re abroad

Of course, there’s some places that are cash only, but with the introduction of credit card payment machines that fit into smartphones such as iZettle, Square, mPowa, SumUp and PayPal Here, in the future, we’ll be paying by cash a lot less (on a side note, I have a card reader, so if you owe me money, you can now pay by credit card!)

So, ditch your cash and debit card, and use your credit card for all your purchases.