Travel money jargon buster

Get to grips with travel money jargon before you exchange currency with this handy guide.

When all you want to do is fast-forward to sipping cocktails on the beach, the matter of exchanging currency can be a bit of a bore.

Especially with the huge array of travel money jargon flying around, which can be confusing at the best of times.

That’s why we’ve put together this handy glossary to help you make informed decisions and break through the currency jargon.


This stands for Automated Teller Machine and is effectively a cash machine where you can check your balance or withdraw cash using a debit, credit or prepaid card.

ATM/Cash withdrawal charges

This is the amount you’ll be charged when you use a debit, credit or prepaid card at an ATM. This is expressed as a percentage of the amount withdrawn and tends to be higher overseas.

Commission charges

If you’re converting your money into foreign currency, the company carrying out the conversion will often charge a fee for its services, called a commission charge. These charges are also often applied to travellers’ cheques.

Credit cards

This is a card which gives you access to a line of credit, with which you can make purchases and/or withdraw cash. Interest is charged on the card’s balance if it is not paid off within a given period.

Each card holder has a set credit limit, restricting how much they are able to spend on the card. There are also additional fees which vary from one card to the next.

Currency converter

This is a tool which will estimate how much foreign currency you’ll get for your pounds sterling, based on the current exchange rates.

Dynamic currency conversion

When you use a credit or debit card abroad, some retailers will offer to convert your bill into pounds sterling, allowing you to better understand the cost. This is known as dynamic currency conversion.

Be careful though, because the retailer will likely apply a higher exchange rate for this convenience and they don’t always ask or make you aware of this. Be sure to check before signing your bill or entering your PIN.

If you don’t want to pay for dynamic currency conversion, simply ask the retailer to charge you in the local currency.

Exchange rate

This relates to how much your sterling is worth in relation to another country’s currency. For instance, how many US dollars you’ll get for your pound.

Foreign exchange

This is when you buy another country’s currency using your own country’s currency.

Handling fees

The fee charged by the seller to carry out the exchange into foreign currency.

Loading fees

The fee often charged when a card makes a conversion to foreign currency – usually around 2.75%.

Prepaid cards

Prepaid travel cards are similar to high street gift cards in that you choose an amount to put on them and pay in advance. You then spend on the card until that pre-loaded amount runs out.

As there is no line of credit and you can only spend what’s on the card, you cannot run into debt on a prepaid card, which can make them an attractive option for travellers.

Spending charges

This is a fee levied for using a card overseas to make a purchase.


The currency of the United Kingdom in pounds and pence.

Travellers’ cheques

Although these are now declining in use, it’s worth knowing that travellers’ cheques are a pre-printed, fixed-amount cheque, and often safer than carrying cash around as they can be replaced by the issuer if lost or stolen.

When paying with a travellers’ cheque you’ll be asked to sign for the purchase and will then receive change in cash.

Travel money

This is the money you take overseas, whether that’s foreign currency, travellers’ cheques or a credit, debit or prepaid card.

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