 "Travelling overseas for a holiday? How to best use your cards for maximum gains")
Several countries have rolled out the red carpet in 2023 by offering visa-free travel to Indian passport holders, which is great news for last-minute travellers as they can now choose from options like Sri Lanka, Thailand, Malaysia, Vietnam, and Nepal, among others, to visit without having to get a travel visa, as long as they have the essential passport (valid for at least six months beyond the planned departure date), a valid return ticket, accommodation bookings and travel insurance.
According to a recent survey conducted by digital payments provider Visa, 95% of Indian travellers intended to use their credit, debit or travel prepaid cards for payments at international travel destinations. Here is how best you can use your cards when holidaying abroad:
Consider a travel rewards card that boosts points for flight or hotel bookings
“Opt for a card that suits your travel preferences and offers perks like travel miles, discounts on lodging, or cashback for specific categories like dining and fuel. Numerous credit cards provide rewards, cashback, or points for each purchase. Consider a travel rewards card that boosts points for flight or hotel bookings, letting you amass rewards swiftly, and usable for both immediate and future travel expenses,' said Adhil Shetty, CEO of Bankbazaar.
Some of the credit cards that offer attractive travel benefits are:
Yatra SBI Card
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Rs. 1,000 off on domestic flight bookings. Min. trxn of Rs. 5,000
Rs. 4,000 off on international flight bookings. Min. trxn of Rs. 40,000
20% off on domestic hotels Min. trxn of Rs. 3,000. Max. discount of Rs. 2,000
Complimentary Air Accident cover of Rs. 50 lakh
Axis Bank Vistara Signature Credit Card
Get a Vistara Premium Economy class ticket as a welcome benefit in the first year and in subsequent years when you renew your card.
Earn 4 Club Vistara (CV) points per Rs. 200 spent across all categories. These points can be used for booking flights.
The card also offers bonus reward points and up to 4 complimentary premium economy tickets on reaching spending milestones.
MakeMyTrip ICICI Bank Signature Credit Card
Enjoy Joining Benefits such as MMT Holiday Voucher Worth Rs 2500
1500 MyCash MMTBlack Exclusive Membership
Enjoy the MMTBlack Loyalty Program
Earn As much as 40,000 Points (My Cash) using the card for travel needs
Exchange accrued reward points for flights, accommodation and shopping
Should you already possess accrued reward points, they can be exchanged for flights, accommodations, or shopping. "Some banks collaborate with hotel loyalty programs, enabling cardholders to transfer their reward points at specific ratios. Opting for cards that waive foreign transaction fees is advantageous during international travel, preventing extra expenses from accumulating," said Shetty.
Sridhar Keppurengan, Business Head, Cross Border Payments, India and South Asia, Visa, shares a few insights on how to make the most of credit cards in your international travels:
Enable your card for “International” transactions
Do remember to enable your credit/debit card or even your travel prepaid card for international transactions. Specifically, enable the “International/ Online” feature for hotel and cab bookings before and during the trip, and the “International/POS and Contactless” option for shopping, dining and other card payments during the trip.
Look for travel promotions offered by your card
Cards typically offer travel-related benefits, either in the form of free lounge access, discounts on flight bookings, travel insurance, car rentals, and entertainment options at your destination. These offers come in handy and enable you to go the extra mile, literally.
Ensure your “Card limit” is fully available for use
Make sure to have enough credit limit to cover most of the trip expenses. Many of us do not actively monitor the remaining limits for the month, so it’s a good idea to pay off your credit card bills before travelling to ensure the limit is fully available or prepay as you spend during the trip. Alternatively, you can request a card upgrade or a limit increase from your bank.
Forex markup rates vs. Rewards
While cards in general offer favourable currency conversion rates compared to currency exchanges, some cards offer lower forex markup fees in lieu of rewards, while others do not offer discounted forex markup fees, but provide generous rewards on international travel spends.
Most credit card issuers charge a foreign transaction fee typically range from 1% to 3% of the purchase price and can cause you to pay significantly more than the listed price for anything you purchase abroad. Some credit card companies do not charge these fees at all. Check your credit card terms & conditions to determine if they impose fees on foreign transactions.
Be cautious with ATMs
"We cannot emphasize more on the fact that cash withdrawal should be avoided on your credit cards as it attracts heavy interest and other charges. And the cash advance fee at international ATMs can be steep. Also, you may think that ATMs in developed countries would be more secure but taking a little precaution would not hurt. If you must use an ATM, choose one that is associated with a legitimate bank, as opposed to some random one," advised Paisabazaar.
"We cannot emphasize more on the fact that cash withdrawal should be avoided on your credit cards as it attracts heavy interest and other charges. And the cash advance fee at international ATMs can be steep. Also, you may think that ATMs in developed countries would be more secure but taking a little precaution would not hurt. If you must use an ATM, choose one that is associated with a legitimate bank, as opposed to some random one," advised Paisabazaar.
Higher Rewards on International Transactions
Certain credit cards offer higher rewards specifically tailored for international transactions, a feature typically absent in standard credit cards. "Take, for instance, AU Zenith+ Card, which offers 2X points on travel and international spends, along with 1 reward point for every Rs. 100 spent on other categories. Opting for a card that offers higher rewards for international transactions can significantly elevate your travel experience and maximize reward benefits," said Paisabazaar.
How to choose the right international travel card:
While choosing the best international travel credit card, you must consider the following things:
- The card must be accepted at various foreign outlets, both online and offline
- You should consider a credit card that offers zero or low forex markup fee as compared to regular credit cards
- You should choose a card that offers better rewards or benefits on your international transactions
- If you frequently travel abroad, then you should choose a credit card that offers discount on hotel and flight bookings
- You should look for a credit card that offers international lounge access across various countries
Some examples of ideal international travel cards, as per Paisabazaar are IDFC First Wealth, HDFC Diners Club Privilege, SBI Aurum, among others.
SBI Elite Credit Card
SBI Elite Credit Card
Joining Fee: Rs. 4,999 | Annual Fee: Rs. 4,999 (Reversed on spending Rs. 10 lakh in a year)
Features and Benefits of SBI Elite Credit Card:
Low foreign currency markup fee of 1.99%
2 complimentary domestic airport lounge visits every quarter in India
Complimentary membership to the Priority Pass Program worth $99
6 complimentary international airport lounge visits per calendar year (Max. 2 per quarter)
Complimentary Club Vistara, Trident Privilege and Trident Red Tier memberships
Why is this suitable for international travel as per Paisabazaar?
SBI Elite Credit Card is a suitable option if you frequently travel abroad since it comes with a low forex markup fee, which allows you to save more on your transactions outside the country. It lets you earn better reward points on your international transactions. Apart from general benefits, this credit card also offers international lounge access which is an added advantage if you frequently travel abroad. The complimentary memberships of Club Vistara, Trident Privilege and Trident Red Tier, also allow you to enhance your savings on travel bookings.
InterMiles HDFC Bank Signature Credit Card
Joining Fee: Rs. 2,500 | Annual Fee: Rs. 2,500 (Waived off on spending Rs. 3 lakh in a year)
You can earn InterMiles on every transaction and later redeem them on future bookings. Some of the other details related to this international credit card in India are mentioned below:
Features and Benefits of InterMiles HDFC Bank Signature Credit Card:
Complimentary InterMiles Silver Membership and 8,000 InterMiles at the time of joining
Complimentary Priority Pass Membership with 5 free visits every year to international lounges
16 free domestic lounge visits under Visa Lounge Access Program per year (4 per quarter)
12 InterMiles per Rs. 150 spent on flight and hotel bookings via InterMiles website
6 InterMiles per Rs. 150 on all spends
Why is this suitable for international travel?
InterMiles HDFC Bank Signature Credit Card is majorly suitable for international travel. With this card, you can earn better rewards and save more on your travel bookings. Besides this, you can also avail international lounge access with complimentary Priority Pass Membership. However, this credit card does not have much to offer for international transactions as it comes with a general forex markup fee, like other credit cards.
Which is the best card for international lounge access?
The majority of credit cards provide international lounge access through Priority Pass Membership. Yet, for frequent travellers, having a credit card that offers a higher number of international lounge visits can be beneficial. "In these instances, super-premium cards like ICICI Emeralde, HDFC Diners Club Black, and others offer unlimited international lounge access annually," as per Paisabazaar.