Carrying cash abroad can be worrisome; paying with a credit card/prepaid cards is very convenient. But FX rates and handling fees can surprise you at times.
For instance, After your meal at a restaurant the waiter checks your "i-Card" and asks, "This is a Euro card - are you paying in Euros?", what would you say?
You may think, "It's a Euro card, so I have to pay with Euro. I don't have a choice", but that may not be the best deal for you.
You may think the FX handling fee may be expensive and make you lose money,
but you get a better deal by paying in local currencies.
Stores that accept credit cards are called "merchants" in the credit card industry (payment companies such as credit card companies). Merchants get paid when you use a credit card, and FX/handling fee is on the customer (you), so they don't pay much attention. FX fees vary by merchants, but it's about 4~6%. So, what happens when you pay with local currency using i-Card?
Let's take a look using this chart.
Let's say your bill was $1,000 at some store. You can see at a glance that the i-Card is a much better deal.
|Amount deducted from your account||FX handling fee|
|Paid in Euro||$1,040～$1,060||4%～6%|
(varies by merchants)
|Payment in local currency||$1,030||3%|
So there is a difference of about $10～$20.
This is because, even with the same merchant, the ratio of handling fee and FX rate varies.
Unlike other cards, i-Card offers a fixed FX rate of 3%, so you get a much better deal.
Experienced travelers who know about this withdraw local currencies using cashing features offered by major credit cards on a short stay. Then, when they return home they pay back the amount immediately. This is one way to do it, but the interest of cashing can be troublesome. But with i-Card, you don't have to worry about that either.
Make the smart choice and enjoy your stay abroad.