Airlines spark competition in travel card market
Recent arrivals to the prepaid travel card market from the Airlines are heating up the competition for travelers foreign dollars. With more than a dozen prepaid travel cards now available in the Australian market and new additions all the time, overseas travelers now have plenty more attractive options than taking the travel card on offer from their bank.
According to a recent Mozo comparison the odds stack up well for Ozforex and offerings from Qantas and Virgin. Alternative providers proved the better option multi-currency cards for currency and exchange rates, fees and other bonus features.
At the time of the comparison, Ozforex had the most competitive exchange rate for converting Australian dollars to euro and Hong Kong Dollars, followed by Qantas Cash and Velocity Global Wallet while the least competitive amongst the big four was the CBA Travel Money card, lagging behind by 2% (which makes for a fairly high conversion fee.)
When it comes to general fees and charges (which abound in the relatively new territory of travel cards) the top of the pops went to the NAB traveller card which claimed no ATM fees, no purchase fee (till March 31 2014) but still carried a comparatively high conversion fee of 4%. However the airlines, again in the top three each had no purchase fee, low reload fees, a small ATM fee and lower inactivity and conversion fees than NAB.
The airlines were not only consistently in the top three across the areas of comparison but also offered features and benefits that the banks didn't. Both cards allow card holders to earn frequent flyer rewards points on their international spend at a rate of 1 point per $1AUD and 1 point for ever $2 spent domestically.
Virgin Australia's Velocity global wallet is also the only prepaid travel card of offer a 'virtual card' facility allowing card holders to create a temporary card number, expiry date and security number that could be used to make secure purchases online or over the phone - all for free.
Hopefully the new entrants to the market will inspire the banks to make their offerings more competitive and drive continued innovation in the industry.
If you're headed overseas and want to leave home with the best possible card for your travels, visit Mozo's travel money hub where you can compare prepaid travel cards or travel insurance and apply online in seconds.