Escape to an Island in the Sun

Debit Cards for Expats
(With a Free Card from FairFX)

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Since the global financial crisis, many of us have fallen out with credit cards. Individually, as well as nationally and globally, we can now see that being encouraged to spend beyond our means has been a bad thing. One early catch phrase during the launch of the credit card revolution was that “Access (remember those?) takes the waiting out of wanting,” which now seems rather hollow, as we now realise that our 'wanting' costs considerably more, if left unpaid on the credit card. Many people have also experienced considerable worry and illness due to increasing personal debt, particularly at a time of severe recession and job losses.
Debit cards are a useful alternative. A direct charge against our bank account helps to remove immediate temptation, and encourages us to spend within our means. However, personally, I am reluctant to use these cards online or with traders that I do not know, because of potential fraud. Now that I live overseas, I rely a great deal on purchases on the Internet; indeed eBay has been a real lifeline for items that I cannot purchase at a fair price on the island. I prefer to keep my bank debit card for cash withdrawals, and not run the risk of my card being used by some overseas scam operation to clear out my bank account. So without credit or debit cards, what are the alternatives?

Well, you could ask your bank to set up a second current account with a debit card, just for Internet transactions. However, this usually means additional charges for running the account, as well as charges for the issue of the card, which can be very expensive in Spain. Some Spanish banks issue prepaid cards specifically for use on the Internet; although useful, I have found that they are expensive and one that I tried involved a visit to the bank to top up, as this feature was not available online. Such an arrangement is not ideal if you suddenly find a good value flight online, and need to complete the transaction quickly.

I now use prepaid debit cards issued in the UK. The main one that I use is issued by
FairFX free of charge, and is available in euros, dollars and sterling. I can transfer money instantly from my main UK bank account into the prepaid card. These funds are then converted into euros (or dollars if you prefer) and are instantly available for use. They can be used to withdraw cash from most cash dispensers worldwide, at a cost of 1.50 euros for each withdrawal (maximum 300 euros) or use for purchases in any establishment that accepts debit or credit cards in the usual way. There are no additional charges for operating the account, which is a bonus. The only downside appears to be that you have to have a UK address, but this can usually easily be overcome. (See my earlier 'Letter from the Atlantic', “What's your address?”)
FairFX, offers a particularly good rate of exchange - far better that at airports, of course, or even the Post Office. I can view the transactions online, top up from my mobile phone, as well as operating a second card for my partner. Best of all, it is a secure way to do business online, and it is reassuring that, should the worst happen, I would only lose the top up amount on my card, which I deliberately keep at a low limit and top up only when needed.

Prepaid debit cards are also a good idea if expats have children living in the UK, or maybe attending university. They can be given a card linked to the main account and then their card can be topped up as and when they need, or deserve, some additional cash! It is ideal for Christmas and birthday presents too!

There are now a multitude of such cards available, but, as an expat, only a few meet my criteria of being either free or cheap to run, offer a good exchange rate, online access and choice of currency. I have a card that I operate in euros only in Spain and the Canary Islands, one in dollars for purchases from, and when visiting, the US, as well as one in sterling for UK purchases and visits.

I hope this information helps. Further information about banking as an expat is available on the
Expat Survival website.

For further information about
FairFX and the cards that they offer, click here. If you open a new account with this link, the usual account opening fee of £9.95 will be waived.



If you enjoyed this article, take a look at Barrie’s websites: http://barriemahoney.com and http://thecanaryislander.com or read his latest book, ‘Footprints in the Sand’ (ISBN: 9780995602717). Available in paperback, as well as Kindle editions.
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