A. It's a good idea to use credit cards when travel overseas, because credit cards come with some advantages:
1) Protection
You’re protected against unauthorized charges by federal law in case your card is lost or stolen. The law limits your liability to $50 but many credit card issuers offer zero-liability protection.
2) Better Exchange Rate
Purchases made with a credit card typically get a much better exchange rate than you can get from a currency exchange vendor or ATM, because your card issuer offers close to the best rate available as it’s set by the major networks, Visa and Mastercard. But, depending on the policies and features of your credit card, you may also pay a fee for the currency conversion. Credit card networks charge the fee to your bank and the cost is generally added to your purchase. Some credit card issuers will pay the currency conversion fee for you, so you may want to shop around for a new credit card before your trip.
Here are some tips when use credit cards overseas -
1) Call Card Company Before the Travel
You don't want your foreign transaction declined. So it's a good idea to call your credit card company and tell them your travel plan before leaving home.
2) Take Multiple Cards
In case of loss or theft, or transactions suspended by the card company, you will be covered if you bring multiple cards with you.
3) Shop Around to Avoid Foreign Transaction Fees
Credit card companies typically charge a foreign transaction fee on purchases. The fee is typically 3% of each purchase. That can add up. Shopping around ahead of time for a new card that offers no foreign transaction fees could save you a chunk of money.
4) Use Cards With A Chip
Chip and PIN cards have been used in Europe and many Asian countries for years, but they have just started to be widely used in the U.S. Some issuers in the U.S. still require a signature rather than a PIN - those cards are known as chip and signature cards. You were probably recently sent a new card recently with an embedded chip for payment. Using the chip for payment instead of swiping the card makes for a more secure transaction - and it’s pretty much required if you plan to use your card while traveling.
In Europe, bus or train ticket machines, gas pumps, and vending machines only accept chip cards because it’s so much better at preventing fraud. If your card doesn’t have a chip, ask for a new one with the technology, or get a new credit card with chip technology.