Cash passports or alternative

[serfty]

I would not go near the Travel ex Cash Passport.

I gree with the others on the 28° Mastercard (nee Wizard). I have had one for several year and have not looked back.

There is a very good thread on that product here:

• http://www.australianfrequentflyer..../28-wizard-mastercard-cash-advances-6960.html

 

[blackcat20]

mr mink I would suggest you've not read the fine print on the travel cards. With the fees for loading them up and etc. they are poor value.

I managed to get my travelex card fee-free, for both purchase and top-up. And I checked; the exchange rate is the same with or without the fee. As I'm in no position to be getting a new CC, the travelex card seems good value to me, combined with some cash. Anything extra will come off my debit card, but the currency conversion fees do add up after a while...

 

[serfty]

... And I checked; the exchange rate is the same with or without the fee. ...

The problem is the exchange rate is generally very poor in the first place.

e.g. Today, Travelex.com.au will give you 1.0310 USD for 1.00 AUD. The Current cross rate is 1.074 - thats a 3% arbitrage.

... As I'm in no position to be getting a new CC, the travelex card seems good value to me, combined with some cash. Anything extra will come off my debit card, but the currency conversion fees do add up after a while...

Fair enough, that may be best for you.

 

[blackcat20]

The problem is the exchange rate is generally very poor in the first place.

e.g. Today, Travelex.com.au will give you 1.0310 USD for 1.00 AUD. The Current cross rate is 1.074 - thats a 3% arbitrage.

I guess you could consider that a hidden fee, in addition to the usual fee. I dont think any business will ever give you 1:1 exchange, otherwise there's nothing in it for them. Even a cash exchange is always a few cents lower...

 

[serfty]

... I dont think any business will ever give you 1:1 exchange, otherwise there's nothing in it for them. Even a cash exchange is always a few cents lower...

The 28° Mastercard almost does or sometimes better, see this post from the thread I linked to above:

I withdrew ¥21000 from a Citibank ATM at NRT T2 arrivals on the 23rd February using my 28° with no issues.

FWIW, that ¥21K cost me AUD254.06, which according to XE - Credit Card Charges Calculator had an inbuilt commission of minus 73¢.

 

[Febs]

I'm in the same boat. Jan-Feb 2012 trip coming up (potentially also a March 2012 move to HK) and would like to change some cash now and lock in the current rate. Sure it might go up a bit, but I can't see it staying this high for another 10-12 months.

Anyone know of any banks (HSBC) that allow you to open a multi-currency account? Or several accounts (one for each currency)? Advantage of a bank account is that you still accrue interest.

I'd like to exchange a bit of USD and a bit of HKD, but don't fancy exchanging cash (and having it sit around + losing interest), and the Travelex passport doesn't sound great either.

These AMEX/AustPost cards - presume you can use them as debit cards overseas? i.e. exchange now, lock in a rate, then use them for purchases (as an AMEX) in 12 months? Any other suggestions? How easy is it to set up a USD/HKD bank account, and transfer money to them from Australia (I'm with CBA if it makes a difference)? Thanks

I had a Wizard Clear Advantage Mastercard. You could load this up in the black with AUD and then withdraw cash in the local currency wherever you travelled in the world. There were NO charges or transaction fees, and the exchange rate is/was as good as you'd get.

Recently it's changed name and is now issued by GE rather than Wizard, but as far as I can tell it still operates the same.

Try logging on to 28degreescard.com.au and look at the "Features" tab.

It's been long-established on this forum that this is one of (if not the) best way to exchange cash, but it's also completely useless for the OP's situation, as it requires actually being in that country.

I've been using the Wizard/28deg card for 4 years now and it's fantastic (even moreso as I used to have regular US trips, but not so this year)...but not for the OP's situation.

Cheers,
- Febs.

 

[medhead]

I guess you could consider that a hidden fee, in addition to the usual fee. I dont think any business will ever give you 1:1 exchange, otherwise there's nothing in it for them. Even a cash exchange is always a few cents lower...

And a NAB gold debit card almost does as well. It also has the advantage of not being a credit card.

 

[HardieBoys]

Thanks for all the feedback. It would appear that regardless of the method used - with the possible exception of the 28degrees card - that a fee of 3 - 6% of total costs seems to be the average.

I've decided to go with a combination of the ANZ card and will look into the 28degrees card in the future. The only thing I'm uncertain about is how good the exchange rates the 28degrees card offers. There's little advantage in 'no fees' if the trade-off is for a lousy rate.

 

[medhead]

I've decided to go with a combination of the ANZ card and will look into the 28degrees card in the future. The only thing I'm uncertain about is how good the exchange rates the 28degrees card offers. There's little advantage in 'no fees' if the trade-off is for a lousy rate.

I'm sure that the exchange rate on the 28 degrees card has been mentioned a few times here. It is just about the same as the market rate on the day. I haven't used this but reports of within a cent are common.

This is also the same with NAB gold banking, which has the advantage of being a savings account and not a credit card. Again almost exactly the same as the same as the market. I have used this and it has been within 0.5 cents IME.

There are 2 option for fee free and good exchange rates. Only they don't allow locking in the current rate (hedging) for future use.

 

[Febs]

I'm in the same boat. Jan-Feb 2012 trip coming up (potentially also a March 2012 move to HK) and would like to change some cash now and lock in the current rate. Sure it might go up a bit, but I can't see it staying this high for another 10-12 months.

Anyone know of any banks (HSBC) that allow you to open a multi-currency account? Or several accounts (one for each currency)? Advantage of a bank account is that you still accrue interest.

Answering my own post here, but I've looked into this a bit further and it seems HSBC and Citibank both offer multi-currency accounts that look attractive. I'm heading into HSBC tomorrow to open one up (not a fan of Citibank + I'd like an HKD account too). Seems that as long as you keep the balance > $1000AUD, there are no fees, and the withdrawal fees etc.. all seem fairly reasonable.

Keep you all posted.

Cheers,
- Febs.

 

[mr mink]

Re: Cash passports or alternative - Debit cards might still rule

I think you miss the hidden cost with cash passports, the poor initial exchange rate. The banks sell at the same rate as for selling cash notes, this is about 4-6% below the mid rate, and they then hit you another 1% fee. You can see the big difference between the buy and sell rates.

So if a credit card or standard debit card get you for a 3% fee at least the mastercard exchange rate is close to the midrate.Of course you really should use a 28degrees card.

[My Note: ANZ have a slightly different (higher) rate for loading Travelcards/t-cheques (although CBA is the same as notes) but this really covers the 1.1% higher rate to load].
I have read the ensuing posts with interest (and although I have actually read the fine print despite assertions to the contrary :mrgreen have since checked out the 28 degrees card as well, which I hadn't in detail before, as I can still get one before I go to Europe for 6 wks at the end of May if I need to. Hardly need another CC given I have QFF Visa/Amex + M'card already, but if it is great as everyone says...

The difficulty one would have to generally say is second-guessing forex movements. With 28 Deg. and all other CC's you simply chomp on it and have to pay whatever the rate is on the day the charge is converted. OK with 28 Deg. you no doubt are fee free in terms of rate addons (rather than 3-3.5% with other banks) with a supposedly Christian rate, but can anyone tell me exactly and accurately what this mysterious "mid-rate" is? Is it literally half way between the cash notes buy and sell rate, or between IMT/TT buy/sell rates (for the latter ANZ USD rate for Thurs. for IMT/TT is 1.1142 and 1.0551) - so for today the "mid-rate" is notionally 1.085? I am not aware from among the 3 rates that ANZ offer- IMT/TT, Travelcard/cheques and notes which one is actually applied to CC transactions - is it all secret banker's business?

I do my own crude form of hedging by starting watching the currency rates (which I check every day on my Ipod - Xe.com & ANZ) 2 months or so before I go on a planned holiday. That way I know that if the Euro has gone from 0.69 thru 0.73 I know what is relatively the best day to buy and lock it in.

The elephant in the room I have since reflected upon is: if you are purely transacting in the US on your o'seas jaunt at the moment you cannot lose it seems, with the AUD heading for the headline figure of 1.10USD. However if you are in the Eurozone etc and you are first converted to USD then to AUD surely you are doing yourself even more damage, due to weak USD/strong AUD, than the usual extra cost of a double exchange rate switch? I saw a telling graph on TV tonight with AUD going up 4% over X period against the Euro with the USD going down 15% during the same period. Did not sound like such a good look converting thru USD as the median currency to me at all. Think I might revert to my original plan to buying my Euros on a 'good' day on Travelcard at fixed rate rather than seeing conversions sink under the waves with the USD conversion.

Do Visa/Mastercard foreign transactions all convert thru USD? I assume my Euro Travelcard, if used in non-EUR Czech/Hungary etc, will simply be converted to Euros rather than thru another currency. Economics professors, start your engines!

 

[medhead]

The mid market rate is basically the headline rate you see on the news at night. Mid way between the buy and sell rates on the currency trading markets. Nothing to do with the various bank rates. The number that XE publish.

Only American express convert via the USD.

 

[serfty]

I use the XE - Credit Card Charges Calculator to do my arbitrage calculations (see my post #25 of this very thread).

 

[mr mink]

The mid market rate is basically the headline rate you see on the news at night. Mid way between the buy and sell rates on the currency trading markets. Nothing to do with the various bank rates. The number that XE publish.

Only American express convert via the USD.

Ahem, medhead, me thinks it is time you read the 28 Degrees fine print which i did check myself in making the previous comment about elephants (see FAQ - transactional Qs page as follows):

<< How is the foreign exchange rate calculated?
The foreign exchange rate is calculated by MasterCard International on a daily basis according to daily foreign exchange fluctuations. The conversion will consist of two calculations if the transaction is made in foreign currency – it will first be converted to US dollars and then calculated to Australian dollars for listing on your transactions. >>

so my comment stands.

 

[serfty]

... so my comment stands.

That's probably why sometimes I get a -ve "arbitrage"

 

[HardieBoys]

The foreign currency transaction fees to buy cash vary according to currency: checking rates on Westpac this evening:

USD - 3.24%
GBP - 4.24%
EUR - 5.12%

Given that there's a 1.0 - 1.5% fee (on Westpac) to use a credit card overseas, the premium for locking in a given exchange rate seems to be 1.75 - 3.6%

 

[blackcat20]

Last time I looked the westpac conversion fee was 3%...

 

[medhead]

Re: Cash passports or alternative - Debit cards might still rule

Ahem, medhead, me thinks it is time you read the 28 Degrees fine print which i did check myself in making the previous comment about elephants (see FAQ - transactional Qs page as follows):

<< How is the foreign exchange rate calculated?
The foreign exchange rate is calculated by MasterCard International on a daily basis according to daily foreign exchange fluctuations. The conversion will consist of two calculations if the transaction is made in foreign currency – it will first be converted to US dollars and then calculated to Australian dollars for listing on your transactions. >>

so my comment stands.

Oh so only Amex and the 28 degrees card then thanks for pointing that out. Use NAB gold banking then.

I would refer you to my earlier post where I said I don't have a 28 degrees card - hence I haven't read the fine print. I think I've been very open on this point.

Also me thinks you need to reread your question. It does not specific the 28 degrees card only. Nor does the discussion about conversion indicate it is exclusively about the 28 degrees card. :-|

Do Visa/Mastercard foreign transactions all convert thru USD? I assume my Euro Travelcard, if used in non-EUR Czech/Hungary etc, will simply be converted to Euros rather than thru another currency. Economics professors, start your engines!