Advantages of using a credit card for transactions abroad,it's not just about getting cashback!

There are many things to take care of before traveling abroad. Not only your passport and visa, but you also need to prepare a suitable payment method for shopping while traveling in that country. Besides the relevant national currency, a credit card is the right payment tool to use during your foreign trip. Why is that? Let's look at the details below:

1. Practical for Use in Many Countries

A single credit card with a Mastercard logo can be used in many countries at once, ranging from Singapore and the United States to European countries. So, you do not need to exchange rupiah for SGD or EUR while traveling in these countries. With just one card, you can buy many things in those countries.

2. Flexible Payment

Unlike paying with a debit card (ATM card), your money will not be reduced immediately when paying with a credit card. When paying bills with this card, the money you use to purchase goods and services belongs to the bank, and you only settle the payment when the billing date arrives.

This means you can file a payment cancellation if the bill shows a transaction that you did not actually make. This kind of advantage is certainly not available with transactions using cash or debit cards.

3. Relatively Safer

A cashless payment system like using a card is relatively safer compared to cash because, first, you do not need to carry a large amount of cash while traveling abroad. Second, you must enter a PIN when transacting. Third, you can immediately contact the bank to request a block if your card is lost. Finally, you can monitor transaction details from SMS banking or through an application, so if there is a suspicious transaction, you can immediately request a block.

Especially if you use an Honest credit card. Besides being equipped with the Honest App, the physical Honest credit card does not have the card number or CVC/CVV number. Thus, someone who steals or finds your card cannot automatically use it for online transactions.

4. More Economical

There are many intrinsic or hidden costs that tourists must pay during transactions abroad, starting from foreign transaction fees, the exchange rate difference between the rupiah and the relevant foreign currency, and administration fees if you withdraw cash at an ATM in that country.

Well, you will avoid these fees if you use the Honest App. Honest offers a foreign transaction fee waiver, which on other credit cards can range from 2.5% to 3.5% of the total transaction. Not only that, the more you use this card abroad, the more points you can collect. These rewards points can then be exchanged for various discounts and cashback.

5. Easier Budget Management

Not only does it save costs, but paying bills with the Honest credit card and Honest App abroad will also simplify budget management. This is because all transactions will be recorded in the billing history in the application, making it easier for you to evaluate your spending. This facility is certainly not something you will get if you shop using cash abroad.

6. Other Attractive Offers

When you own and pay using this banking facility, you can get various attractive offers that you will not get if you pay using cash or a debit card. These attractive offers include:

• Discounts, whether for airline tickets or at restaurants;
• Cashback for transaction payments for flight ticket bookings and/or food purchases at restaurants and admission tickets to tourist attractions;
• Special facilities, such as lounges, certain play areas, and so on;
• Rewards points or miles. These points can be collected to get future discounts, merchandise, or allow you to waive the annual fee;
• Travel insurance. Some credit card products are also equipped with foreign travel insurance facilities;
• Payment convenience. Although not recommended because of interest charges, one of the privileges of shopping with this card is that you can convert the credit card bill into installments, which makes the payment process lighter.

For example, by having a Mastercard-logo credit card, you can enjoy special lounge facilities or certain play areas at Changi Airport, Singapore.

In addition to the 6 points above, another advantage of a credit card for foreign transactions is that with this payment facility, you can withdraw cash without needing to go to a money changer. However, it must be remembered that getting money this way is called a cash advance and will be charged high-interest fees, especially if done abroad. Therefore, this method should only be done once or twice in very urgent conditions.

Frequently Asked Questions

1. Is it better to use cash or a credit card for transactions abroad?

You can combine both according to your needs. If you use a credit card, make sure the card has a Visa or Mastercard logo.

2. Are foreign credit card transactions subject to additional fees?

Generally, transactions using a credit card abroad are subject to a fee of 2% - 3% of the total transaction. However, there are still some banks that do not even charge additional fees when making transactions abroad.

3. How can a credit card be used abroad?

You can apply directly or online to the bank; each bank may have different requirements.