JavaScript disabled. Please enable JavaScript to use My News, My Clippings, My Comments and user settings.

If you have trouble accessing our login form below, you can go to our login page.

If you have trouble accessing our login form below, you can go to our login page.

From frequent flyer to happy buyer

Date

Zoom in on this story. Explore all there is to know.

Would you use a frequent flyer card that doubled as a debit card for your international shopping?

Would you use a frequent flyer card that doubled as a debit card for your international shopping?

The fortunes of Qantas and Virgin Australia rarely fly straight and level, but the airlines' frequent flyer programs are money-spinners in their own right – and now they're expanding their reach into the "travel money" sphere.

It's a smart move. Prepaid travel money cards are becoming the new traveller's cheques, and by baking this functionality directly into their frequent flyer cards, Qantas and Virgin Australia stand to gain a piece of the action.

For those not yet up to speed, travel money cards are effectively prepaid debit cards which you load up with Australian money and then transfer into a "virtual" wallet of one or more foreign currencies.

The card can be used over the counter (like a credit card, or more accurately debit card) or online, with the option of withdrawing cash at an ATM.

The exchange rate is a few points off the average over-the-counter cash rate, but that's the cost of such convenience.

They also provide a degree of insulation against the fluctuating fortunes of the Aussie dollar.

If you loaded up your travel money card in April – when the Kanga was riding high at US$1.04, €0.81 and £0.69 – you'd have over 15% extra cash in hand compared to today's low rates.

As somebody who spends a fair amount of his time hopping (and shopping) from country to country, travel money cards are the bee's knees – provided you choose them and use them carefully.

Cash remains king

But my go-to strategy for foreign currency remains cash. There's nothing quite like coin of the realm.

I'll usually stock up on a range of currencies for my most-visited countries whenever the Aussie dollar appears to be at a high point – even if that's a relative high, with a likely dip around the corner.

If I'm short on time before my travels, I head to the Travelex.com.au website.

This not only offers competitive rates – certainly better than you'll find at most Travelex kiosks, especially at the airport outlets – but paying for a currency order via BPAY means there's no commission, and I can pick up my money at the airport the day I fly out.

One wrinkle is that I don't use credit cards.

I cut mine up over a decade ago – well, truth to tell, my bank did the cutting – but as soon as I was in the black I never looked back.

This puts me at odds with most frequent flyers who delight in packing a wallet full of plastic, carefully chosen to yield the maximum number of points and perks.

But I've got a debit card and zero debt, and I'm simply happier living this way.

So for me, travel money cards are a good fit into my globetrotting habits, and both the Qantas Cash and Virgin Australia Velocity Global Wallet travel money cards got my attention.

Qantas Cash vs Velocity Global Wallet

How do they stack up?

Overall, Qantas Cash comes out ahead in my book.

It offers a full set of eight overseas currencies to use at any time and doesn't charge a fee to load money into your account, whereas Virgin's Global Wallet restricts you to four foreign currencies and hits you up for a $1 load fee.

That said, Virgin's Global Wallet lets you create a free "virtual card" with its own unique number to be used for online or telephone purchases.

The card can be deleted after use and a new one, with a new number, created for no extra charge – very handy if you're worried about online security and your card being scammed.

And while I hear plenty of grizzles about the exchange rate, people all too quickly quote the numbers they hear on the news or see online – for example, at time of writing, $1 was officially worth US89c and 57p – but forget that you can't buy at this rate.

Most banks were selling around US85c, with currency exchange shops offering US87c if you're lucky, so that Qantas Cash was trading at US86.8c seem a decent deal.

Plastic not-so fantastic

Of course, there are some caveats with these cards.

It takes up to three days to load them with money – there's no 'instant' option, so you need to load up in advance of your trip.

Once overseas, you'll be stung a few dollars for each ATM withdrawl, and that's not taking any operator fees into account.

I avoid relying on ATMs for that reason, and always prefer a pocketful of cash.

And less frequent travellers can be hit by an inactivity fee for not using the card – Qantas charges $1 per month and Virgin double that. Okay, guys – explain to me again why not using my card causes such an impost on your business?

What's your strategy for managing your travel spend: cash, credit card or travel money cards? And will the new Qantas Cash and Virgin Australia Global Wallet cards work for you?

David Flynn is a business travel expert and editor of Australian Business Traveller.

Twitter: @AusBT

13 comments

  • So.....

    David Flynn is a business travel expert...

    Who is claiming...

    "One wrinkle is that I don't use credit cards.I cut mine up over a decade ago – well, truth to tell, my bank did the cutting..."

    With expert help like this, we're all good to go then, I guess.

    Commenter
    Aqualung
    Location
    Sitting on a park bench...
    Date and time
    September 04, 2013, 12:36PM
    • I appreciate the author's honesty about a 10 year old issue with a credit card. Who hasn't had money issues? Especially in their younger years? Thankfully, banks and other credit providers are more forgiving than some everyday folks.

      Commenter
      Peter
      Location
      Perth
      Date and time
      September 04, 2013, 2:05PM
  • I travel frequently for work so I tend to put everything work related on my corporate card. But let's face it, when in New York or London, personal expense creeps in. For that and those times when it's purely leisure travel I never ever have or would consider carrying a wad of cash. If you lose your wallet or have it stolen, you're going to be well and truly down on your money. So what's left? Credit cards - they charge a foreign transaction fee every time you use it; your regular ATM card - same again on the foreign transaction fee (usually AU$3); or one of these travel cards - which I have yet to be convinced of the merits of over your regular every day ATM card, particularly if as you mention they charge you for not using it and you have money on it where you're not earning the interest. On a typical 2 week trip I incur about $60 - $80 in foreign fees on my credit card - but if I lost my wallet full of cash, left it somewhere, or had it stolen, I'd be out a lot more.

    Commenter
    NateAU
    Date and time
    September 04, 2013, 12:47PM
    • Here's the best value and convenience combination for travel anywhere and everywhere OS.

      1. Travelex cash in small local currency amounts (say $100 equivalent) as emergency funds for countries visited ('what do you mean you don't accept a credit card??'). And for tips if you're inclined...

      2. A GE Money 24 Degrees Mastercard for all serious expenditure (trains, boats, planes, car rentals hotels, restaurants, bordellos etc etc). This card has way better exchange rates than cash from ANYWHERE short of a holdup (if the AU$/US$ rate today is about 90 cents, Travelex cash will be about 86 cents and the 24 Degrees Mastercard will be about 89 cents.. AND THERE ARE NO INTERNATIONAL TRANSACTION FEES ON THIS CARD. If you're using a credit card from any of the majors there's a 3% foreign transaction fee and a disadvantageous exchange rate and your effective US$ rate will be about 85 cents today!!

      Get with the program....

      Commenter
      Cornucopia
      Location
      GC....too windy this time of year...
      Date and time
      September 04, 2013, 12:49PM
      • Yep u are right cheers

        Commenter
        Taurus
        Date and time
        September 04, 2013, 1:37PM
    • I am with you David though I got a credit card a few years back with only a 5K credit limit as an emergency back up to my emergency back up. I did this as so many hotels I stay take $50-$100 per day off a card to cover for incidentals (returned up to 10 days after up you check out) which played havoc with my cash flow when using my prepaid card (I am not that well off so travel frugally).

      Yes- you can strike deals to put down cash or not have a room with a mini bar but this becomes tiresome and time consuming and not always possible. So, I take cash (both US & Aussie dollars), prepaid Visa card (with a second card), my Visa debit card (emergency backup), Visa credit card (x2 emergency backup). I usually travel far from home for extend periods and don't have a mum & dad to fall back on if I get into difficulty so I have to travel smart. The best advice I ever got was when an older traveller asked me to talk through some of my worst case scenarios and how I would deal with them which highlighted any areas of concern for me- hence the low limit credit card.

      Commenter
      Peter
      Location
      Perth
      Date and time
      September 04, 2013, 1:06PM
      • Citibank Plus account - is the BEST card to use anywhere in the world.
        Its FEE FREE at ATM's, Stores etc. Better exchange rates too.....why bother travel cards ??

        Commenter
        Sultanz
        Location
        Sydney
        Date and time
        September 04, 2013, 1:10PM
        • +1. Got mine in time for my trip to Europe a couple of months ago and it was the best thing I ever did (in relation to travel money that is!) When paired with the 28 Degrees Mastercard, you've got an unbeatable combo of cheap o/s money.

          Apply online today :)

          Commenter
          Hakeswill
          Date and time
          September 04, 2013, 1:40PM
        • + 2 for the citibank card. Only takes one day for the money transfer and no fees.

          Commenter
          Starinc
          Date and time
          September 04, 2013, 3:18PM
      • GE Money's 28 Degree Mastercard is the way to go. They give you a small credit limit but I only use that for emergencies. Before I leave I transfer cash onto the card so that I have a positive balance and only use that. This way, no interest charges, no ATM fees, good currency conversion rate and I don't have to load several currencies like you do on the travel cards. If I run short I log on to my banks internet site and transfer a top up by BPay - that usually hits the 28 Degrees account within 48 hours.

        Commenter
        PF72
        Location
        Brisbane
        Date and time
        September 04, 2013, 1:32PM

        More comments

        Comments are now closed
        Advertisement
        Featured advertisers
        Executive Style newsletter signup

        Executive Style newsletter signup The latest news delivered to your inbox twice-weekly.

        Sign up now

        Advertisement