Travel credit cards typically provide rewards on airfare, hotels and car rentals; additionally they allow cardholders to redeem points or miles for non-travel options such as statement credits or gift cards.
These cards often carry higher interest rates, making them ideal for people who can pay their balance in full every month. Otherwise, cash-back credit cards might make more sense.
Visa and Mastercard
When it comes to selecting the ideal travel credit card, most travellers opt for either Visa or Mastercard – the two largest payment networks cover billions of cards worldwide and are widely accepted across almost every nation.
Visa or Mastercard cards are the most secure ways of traveling abroad. When you see their symbols at checkout, any merchant must accept your card even if issued from another bank or financial firm.
Visa and Mastercard dominate in merchant acceptance worldwide, although Discover and American Express come out ahead when it comes to tourist-focused locations where AmEx acceptance rates tend to be low. The difference becomes even more pronounced for higher-tier cards like World or World Elite Mastercards which tend to provide more perks and rewards, although these may vary depending on an issuer’s negotiated agreement with their card network – benefits such as purchase protection, no liability for unauthorised charges and cashback rewards may still vary significantly between cards.
American Express
American Express is an established card network offering cards suitable for consumers of all types and circumstances. Some American Express credit and charge cards provide cash back rewards on purchases while others come equipped with travel-related perks like 24/7 emergency assistance, car rental loss/damage coverage, trip cancellation/delay insurance and trip delay protection policies.
American Express may not be as widely recognized as Visa or Mastercard, but it remains an effective card network. A February 2020 Nilson report found that nearly all merchants in the U.S. accept Amex payments; additionally there are over 10 million locations globally that accept it.
To qualify for most AmEx credit cards, applicants will typically require good to excellent credit. Though the exact criteria vary by card issuer, Amex typically considers your payment history, overall debt levels, reported income and other information from your credit bureau report when reviewing applications. Furthermore, American Express cards often require full payments each month while some now come equipped with “Pay Over Time” features that enable partial payments over time.
Discover
Discover credit cards are ideal for travelers and provide effective security features, but the interest rate can be higher than Visa or MasterCard cards; therefore it’s crucial that any balances owed be cleared monthly.
Discover is rapidly increasing its presence worldwide; however, its international acceptance still trails behind that of Visa and Mastercard. Before traveling overseas, use Discover’s credit card acceptance map to see if its cards will be accepted there.
Be mindful that Discover does not waive foreign transaction fees, meaning you’ll have to cover their share in the daily exchange rate (known as Dynamic Currency Conversion). Therefore, whenever possible it would be beneficial if items purchased were in local currency rather than US Dollars to avoid these charges. You should always carry some backup payment method and cash just in case something unexpected comes up outside tourist hotspots; don’t forget to notify Discover that your trip abroad so your card doesn’t get flagged for suspicious activity!
Other Credit Cards
NerdWallet’s ratings take these factors into account when ranking travel credit cards; to find the ideal card for travelers. If your goal is to accumulate points that can be redeemed for cash, look for one without foreign transaction fees; for larger welcome bonuses consider an airline or hotel co-branded card that’s part of their loyalty program, or select one without annual fees but offers generous sign-up bonuses.
Before applying, keep in mind that some card issuers have rules restricting when and how many accounts you can open – for instance Chase has an unwritten “5/24 rule,” while Wells Fargo follows similar policies.
