What are "cash passports" and how much do they really cost?
Over the last few years, we've seen "cash passports" becoming increasingly popular amongst travellers. Beware - the true cost can come as a bit of a shock...
What are "cash passports"?
Reloadable pre-paid debit cards - usually Visa or MasterCard - which can hold one or more foreign currencies. Cash passports can be convenient, especially if you're worried about carrying your main debit cards and credit cards around while you're travelling.
How much does it cost to use a cash passport?
More than you think, most likely! This is a difficult question to answer, because there are a LOT of different fees associated with cash passports. If you're not careful about how you use them, they can become very expensive to use.
For example, say you bought a major brand cash passport card in the US and loaded it with Euros you'll pay a fee of 10.9%! (based on buying 1000 EUR at an exchange rate of USD 1 = EUR 0.7691 on the website, compared to the XE.com mid-market rate of 1 USD = 0.863266 EUR).
You may then pay local ATM operator fees if you use your cash passport to withdraw Euros at an ATM.
If you use the card to get another currency like Swedish Krona, you'll pay an additional 5.5% fee. Yes, that's in addition to the 10.9% you paid to load Euros onto the card, and the 2.00 EUR ATM fee. So you'll pay more than 15% to get cash from a Swedish ATM!
When you finish your trip, what happens if you have cash left on your cash passport? You can pay USD 20.00 (plus a 5.5% foreign exchange fee) to get your remaining balance refunded in USD. If not, you'll pay USD 3.00 each month that the card is inactive.
So before you buy or reload a cash passport, make sure you read about all the fees and plan how you're going to use it!