This is how you should use your UK HSBC card abroad

TransferWise content team
11.10.17
7 minute read

Holidays are great, but they rarely come cheap. You certainly don’t want to pay over the odds while you’re away by being hit by bank fees and charges. If you’re planning a trip abroad, you can avoid excess charges by deciding in advance how you want to pay your way while you’re travelling. Debit or credit cards are often the most convenient and safe option while you’re away, but using them can be expensive. Make sure you know what fees and charges apply to your HSBC card before you go, to make sure your money goes further.

Read this guide to find out:

  • How and where you can use your HSBC credit or debit card abroad
  • The potential cost of using your card
  • How to stay safe when using your HSBC credit or debit card while overseas

Can I use my HSBC credit or debit card card abroad?

You can use your HSBC credit or debit card when you’re away, just like you would at home. You should have no problem if you want to make purchases or withdraw cash, and you can use your contactless card anywhere that the retailer has the contactless symbol displayed. Some countries, however, haven’t yet adopted contactless technology so you may be out of luck.

Cards are convenient, but if you use them while overseas, there may be additional fees to pay. It’s also worth remembering cash is still king in some countries. If you’re heading on holiday somewhere off the beaten track, taking some local cash with you might be a sensible idea, too.

How much does it cost to use my HSBC credit or debit card cards abroad?

Whether you choose to spend abroad using your debit or credit card, you’re going to incur some fees.

Visa or Mastercard

To work out what charges will be applied, you need to check if your card is a Visa or a Mastercard. Although banks issue the card, they then all rely on a company like Visa or Mastercard to process transactions. Visa and Mastercard each use a slightly different method for calculating the currency exchange rate used on your holiday purchases. You can check what type of card you have easily by looking for the symbol on the card itself.

Fee 1: Foreign exchange rate mark-ups

Let’s look at how the calculation works. Imagine you have an HSBC Visa debit card. That means the bank will first apply the daily exchange rate used by Visa, in order to change your purchase cost into GBP. The exchange rate goes up and down with the market, and there’s generally a small mark-up on the rate you’ll find using an online currency converter. However, Mastercard and Visa rates are normally pretty fair, as long as you’re charged in the local currency wherever you are.

One thing you do need to watch out for, however, is Dynamic Currency Conversion (DCC). This is when you’re charged in GBP instead of the local currency. If this happens, the rate used is usually very poor, and you’ll find that you run into incredible mark-ups. But more on that later.

Over time, Mastercard tends to offer slightly better rates for international purchases, according to analysts. But either way, the differences are pretty small and vary depending on which currency you’re spending in. To see how your card exchange rate compares to the real, mid-market rate, run a quick Google search, or use the online currency converter linked above.

You can find the daily exchange rates being used between different currencies by Visa and Mastercard, below:

Fee 2: Non-sterling fees

On top of any exchange rate markups, HSBC will then deduct its cut, which is known as a non-sterling transaction fee. This is set as a percentage of the amount spent or withdrawn, but might have upper and lower limits.

Fee 3: ATM fees

If you’re taking cash out of an ATM, there may also be further charges to pay. If you have a debit card attached to one of HSBC’s Premium or Advance accounts, then the additional cash fee might be waived. However, even if HSBC does not charge, some individual banks or ATM providers might levy their own fees on your withdrawal.

Fee 4: Dynamic Currency Conversion (DCC)

If you’re at an ATM, in a store or at a restaurant, you might also be asked if you want your purchase to be processed in GBP instead of the local currency wherever you are. Although this is described as a customer service, it should be avoided.

The system is known as Dynamic Currency Conversion and it can be applied nearly anywhere your card is accepted overseas. If possible, choose to pay in the local currency. That’s because the exchange rates applied when using DCC are always worse than those your card provider will give you.

Agreeing to DCC is basically giving the local company or ATM machine permission to use its own, mostly poor, exchange rates. While your bank has an interest in ensuring you’re happy with their services, a foreign provider doesn’t, and will happily mark up the exchange rate and pocket the difference. If you choose DCC, you’ll be unnecessarily paying more than you need to for your trip.

Fee 5: Credit card interest rates

There’s little difference to the process or charges if you’re using a credit card, but you’ll also have to take into account any interest charges you might incur if you don’t pay your bill right away.

The exact fees you’ll be liable for are available online or on the back of your card statements. The fees below are a guide, as different card types might vary. You also might be eligible for promotions and opening offers which can improve the rates available.

Here are the fees you’ll be charged to use your HSBC debit or credit card while you’re away:

HSBC Debit Card (Premier or Advance Account) HSBC Debit Card (Other Accounts) HSBC Credit Card (Mastercard) HSBC Credit Card (Visa)
Purchases Non-Sterling Transaction Fee 2.75% 2.99% 2.99% 2.99%
ATM Usage Foreign Cash Fee/ Cash Fee 2.75% 2.75% Plus a cash fee of 2% (minimum charge £1.75, maximum £5) 2.99% Plus a cash fee of 2.99% (uncapped, minimum charge £3) 2.99% Plus a cash fee of 2.99% (uncapped, minimum charge £3)

Confused? You’ll find handy online tools linked above to help you work out what you’ll actually be charged on a day-to-day basis while you’re away. For example, if you spend €100 in a bar in Berlin and use your HSBC Visa credit card, the exchange rate applied taking into account the non-sterling transaction fee charged by your card provider could have looked like so:

  • €1 = £0.92 (12th July 2017)

Using this exchange rate, you can see that the final bill totalled £92. The exchange rate used will fluctuate, of course, so it’s worth checking the online tools regularly.

What if my HSBC credit or debit card card gets lost or stolen while I’m overseas?

It’s a nightmare scenario, but it’s worth considering how you’ll cope if your card is lost or stolen when you’re on your holiday.

If you lose your card when you’re abroad, you need to contact HSBC as soon as possible to report the loss. You can call, with reversed charges, on the number below - to avoid adding any extra costs. They’ll cancel the card and issue a replacement.

  • HSBC 24/7 contact number: +44 1442422929

Another option is to get card protection insurance which could help if your card is lost or stolen while you’re abroad. However, this doesn’t come cheap. Arrange it through your bank or an insurance company, and make sure you have all your policy details with you when you travel - just in case.

Is it better to use debit or credit cards abroad?

You can choose either a debit or credit card while you’re abroad. Your personal preferences and spending habits will dictate which is best.

Using a debit card is better if you have one of the HSBC premium accounts. In this case, the fees for making purchases and withdrawing cash are the same. Using an HSBC credit card to take out cash from an ATM can be expensive as the cash fee of 2.99% isn’t capped.

If you need to spread the cost of your holiday over time, then using a credit card might suit you better, especially if you take some cash with you to avoid ATM withdrawals. Don’t forget though, you may incur additional interest costs. Credit cards can also provide greater security and fraud protection than using cash. Your purchases will be monitored and you should get help if you’re the victim of fraud. Make sure you keep all your receipts, and when you get home check your card statements thoroughly.

What are some good tips for using my HSBC credit or debit card cards abroad?

HSBC asks you to let them know if you’re planning on travelling, so they don’t suspect fraud when they see a change in your spending patterns. You can do this easily with online banking, or by calling customer services before you go (03457404404). If you’ve got a joint account then both account holders have to notify HSBC of your plans individually.

The most important thing is that HSBC has the correct contact details for you if you’re going to be abroad. If the bank detects any suspicious activity, they’ll call you on whatever number is in their system. If it’s wrong or you have your phone turned off while you’re abroad, your account activity could be blocked or limited while they make further checks.

Whether you’re planning on using a credit or debit card, it’s well worth having a secondary option just in case there’s a problem with your main card. Keep local cash on you at all times, too. You’ll likely come across places where cards aren’t accepted.

Even though it’s your holiday, you’re going to have to keep track of your spending, or you might have a nasty surprise when you get back. It’s especially easy to lose track of the cost of everyday things in another currency. To avoid this, you can use your HSBC online banking service to keep tabs, or might want to try an alternative app to monitor and manage your cash flow while you’re away. Setting a daily spending limit will also help make sure you don’t spend more than you planned.

Your holiday shouldn’t be a time to worry about money. So, take these tips and make sure you know which method of payment is going to be best for you before you go. Then all you have to do is relax and enjoy!

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