Best ways to spend travel money in Malaysia: Debit & prepaid cards

Malaysia is one of the most ethnically and culturally diverse regions of the world and a popular destination for tourists. Before you head to Malaysia, make sure you’ve planned how you’re going to access your cash. Sorting out your travel money is just as important as finding travel insurance, accommodation and planning your holiday itinerary.
This guide will help you organise a safe and convenient way to access your cash before you travel. The right travel money option will depend on your financial situation and travel plans, so make sure to compare your options.

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Using prepaid travel cards

These cards have some advantages for travellers, but make sure you dig a little deeper into the travel card fees section in order to find the travel money card that will cost you less to use overseas.

• Multiple currencies. The main selling point for travel cards is the ability to load them with the currency of the country you’re visiting so you can spend without incurring currency conversion fees.
• Budget control. You must keep topping up a travel card with pounds once you spend all your money. This gives you control over how much you’re able to spend and how much thieves could possibly spend if your card falls into the wrong hands.
• Time delay. Reloading your card can take up to 3 days (or even longer if its a bank holiday in the UK), so you need to ensure you don’t let your card run too low before reloading it.
• Backup card. Travel cards usually come with two cards. You can use the backup in the event the primary card is lost, damaged or stolen. A call to the card provider is all it takes to block the first card and activate the second card, although you might want to activate both before you leave.
• ATM withdrawals. Travel cards allow you to withdraw cash from ATMs as well as make over-the-counter payments. Most travel cards charge a flat fee for ATM withdrawals. Some don’t, but these cards often charge for currency conversion or make up the transaction fee in other places such as initial load, reload or card inactivity fees.
• Exchange rate. Most travel cards on the market use a different exchange rate to what’s applied to Visa and Mastercard credit cards and debit cards. A margin is applied by the travel card provider when funds are exchanged from British pounds to a foreign currency making the rates less favourable. However, you can pre-load your cash at a time when exchange rates look likely to be more favourable than the live times which debit and credit cards rely on

Using credit cards

Credit cards are widely accepted in Malaysia. You won’t have a problem using your card at shopping centres, large restaurants and hotels. Using a British credit card overseas comes at a cost though. Here are some fees you’ll want to keep an eye out for.

• Exchange rate. Credit card transactions are subject to the Visa, Mastercard and American Express exchange rates. These rates are mostly in line with market rates and offer a better deal than travel money card rates.
• Fees. There are a number of fees you should be aware of when you use your credit card overseas. The fees you can expect will depend on the card you have and how you use it, but some standard costs include:
  • Currency conversion fees. Unless you have a no currency conversion credit card, you can expect to be charged these fees when you use your British card to make purchases overseas. The average currency conversion fee is 3% per transaction.
  • Cash advance fees. You’ll be charged a cash advance fee when you use your card for ATM withdrawals. These fees are generally high and can sit around the 20% mark. Interest-free days don’t apply when you use your card for a cash advance.
  • ATM fees. As well as cash advance fees, you may be charged a local ATM fee when you use your card to withdraw cash.
  • Annual fee. Many credit cards charge an annual fee, so make sure the value you get from the card outweighs this cost.
• Extras. As well as giving you access to your funds overseas, credit cards may also offer a number of other useful features:
  • Interest-free days. Some credit cards offer interest-free days on purchases when you repay your balance in full by the end of the statement period. The number of interest-free days will vary, but you can usually expect up to 55 interest-free days. If you’re using your card for purchases on your holiday, taking advantage of the interest-free days could help keep your interest costs to a minimum.
  • Complimentary insurance. Some credit cards offer complimentary international travel insurance and purchase protection. You’ll need to meet the eligibility requirements and pay for some of your travel costs with the card, but the insurance usually covers you plus your spouse or children who are travelling with you.
  • Rewards. Some credit cards (and travel cards) reward you with points when you make eligible card purchases. Some rewards credit cards are linked to a frequent flyer program and other cards reward you with points in a provider’s own loyalty program. Some cards offer a higher earn rate when you make purchases in a foreign currency, but these products often charge higher fees. Make sure to compare the value of the points against the extra cost to use the card overseas to determine whether it’s of value to you.

Using debit cards

Debit cards and current accounts are usually free to open. Compare your current debit card against a debit card with travel credentials to see if you can save on purchase and withdrawal fees in Malaysia. You won’t have a problem finding an ATM or point-of-sale terminal in Malaysia that accepts Visa or Mastercard debit cards.

• Exchange rate. Visa and Mastercard debit cards use the Visa and Mastercard consumer exchange rate. This rate is likely to be close to the interbank rate, and the exchange rate spread applied by Visa and Mastercard is only marginal.
• Your savings. Unless you’re using a current account as a dedicated travel account, this account is likely to be your main everyday bank account. Unlike travel cards, which only hold the funds you’ve transferred over, current accounts are likely to hold a larger sum of money. This might be a problem if you have trouble controlling your spending or if your card is stolen.
• Fees. Some of the fees you can expect when using a debit card overseas include:
  • International ATM fees. This fee is charged by the card provider when you use an overseas ATM. If your card provider belongs to an ATM alliance, you might be able to avoid these fees.
  • ATM operator fees. Local ATM fees are charged by the ATM operator. You can avoid this fee in some countries by using an ATM within your institution’s overseas ATM network.
  • Currency conversion fees. This fee applies when you use your debit card outside of the UK. If you want to keep your costs low, look for a card that doesn’t charge this fee.

Using traveller’s cheques

Money safety can be a concern in Malaysia, but traveller’s cheques may not be the answer to your money security woes. You need identification to cash your traveller’s cheques, as they can only be used by you. However, fewer and fewer places are cashing traveller’s cheques in Malaysia as the digital economy grows.

• Fees. You’ll pay a commission to cash your traveller’s cheques when you arrive in Malaysia. This is usually charged on a per cheque basis. You may also pay a handling fee to purchase the cheques.
• Exchange rates. Don’t get traveller’s cheques exchanged more than once. Buy cheques in British pounds and cash Ringgit when you arrive. This will save you getting your money changed twice and losing out on international exchange. Avoid getting your traveller’s cheques cashed at a hotel. Do it at a bank or foreign exchange office. Hotels are likely to offer a far less competitive rate.

Currencies you’ll need in Malaysia

The Malaysian Ringgit (MYR) is Malaysia’s local currency. 100 sen makes up 1 Ringgit and you’ll need to access this currency if you want to pay in cash on your holiday. You can easily get your British pounds exchanged for the local currency at Malaysian money changers, which are located at numerous places throughout the country.

How much Ringgit should you bring on your trip?

Kuala Lumpur	Budget	Midrange	Expensive
	Food court lunch £3	Dinner at Indian Restaurant (for two) £5	Dinner at Ding Tai Fung £7-10
	Canopy Walk at FRIM Forest Reserve £1	Train & boat to Pulau Ketam £2	KL Tower admission (for two) £19
	Metro ride (for two) 70p	Bus from airport £1.80	Taxi from airport £18
	Dorm bed £11	Double room in a 3 star hotel £30	Double room in a 5 star hotel £125+

^{Prices are approximate and are subject to change.}

Travel card, credit card or debit card?

If you’re wondering which travel money option is best to take to Malaysia, the answer is a combination.

It’s important to know how you plan on spending and where you plan on visiting to find the right travel money solution. Cards are widely accepted, but the majority of your spending it likely to be in cash, depending on what you’re planning to do.

Although there’s no limit to the amount of foreign currency you can take into the country and it isn’t hard to exchange your British pounds, ATM withdrawal fees and currency conversion fees should be factored into your comparison. Read on for an overview of the pros and cons of the different types of travel money you can use in Malaysia. You won’t have to worry about withdrawal fees if you opt for a banking app such as Revolut or Starling, though. These work in much the same way as conventional bank accounts do, coming with a debit card authorised by Visa or Mastercard which can be “topped up” from your mobile phone, but the key advantage is that they don’t charge withdrawal of transaction fees.

A quick summary of travel money options for Malaysia

Currency exchange

Malaysians sometimes refer to Malaysian Ringgits as dollars, and some prices use the prefix dollar sign. All prices are in Ringgits even if you hear the vendor saying dollars. Banknotes are divided into the following denominations: 1, 5, 10, 50 and 100. Familiarise yourself with these to ensue you don’t accidentally overpay.

Exchanging your cash

It’s easy to exchange your money to Malaysian ringgit when you arrive in Malaysia. Banks and foreign exchange offices can be found in major tourist centres. There is no fee to exchange cash – just different rates between exchange offices. Shop around to find the best rate, but the difference between exchange offices is usually marginal.

Hotels can exchange cash as well as cash traveller’s cheques, but the rates they offer are less competitive than what you can get at banks and other authorised money changers. To find the best rate, avoid getting your cash changed around Kuala Lumpur Sentral, the airport or at a hotel.

Make sure you check you’ve been given the right amount of cash before you walk away from the teller, and resist the urge to get your money changed on the street or at shops. Street vendors and merchants may be able to offer you a better rate than what you can get at banks and Bureaux De Change offices. However, these vendors are more likely to rip you off.

Using a mix of travel money options

Malaysia is still a cash economy; you’ll need cash to experience some of the best parts of Malaysian food and culture. Most travellers visiting Malaysia opt for a combination of debit, credit and travel cards. Debit and travel cards are a good way to pay for your everyday spending, while credit cards can be used for deposits, big purchases and emergency situations. If you do plan on using your credit card in Malaysia, make sure you tell your card provider about your travel plans first so that your credit card is not blocked.

Frequently asked questions

• What safety tips should I know for handling money in Malaysia?

  Common sense is the best approach to money safety in Malaysia. Avoid carrying excessive amounts of cash and don’t make it obvious if you are holding a lot of banknotes. Use reputable ATMs inside of banks or near banks with security and cover your hand when you’re entering your PIN. Or, if you’re using a banking app, keep a close eye on your phone.

• What are the bank opening hours?

  Banks in Malaysia are open Monday to Friday from 9.30am to 4pm. Banks in the Muslim states of Malaysia may have different opening hours.

• Do I pay more because I’m not Malaysian?

  In some places, you may pay more because you’re a tourist. This foreigner tax is not unique to Malaysia. If you feel the price is unreasonably inflated, all you can do is walk away.

• How much should I tip?

  Unlike countries like the United States, tipping is not expected in Malaysia. A service fee may be included in the bill at some restaurants. A tip is always appreciated though, so you can leave change for wait staff if you feel the service justifies something extra.

Written by

Charlie Barton

Publisher

Charlie Barton was a publisher at Finder. He specialised in banking and investments products, including banking apps, current accounts, share-dealing platforms and stocks and shares ISAs. Charlie has a first-class degree from the London School of Economics, and in his spare time enjoys long walks on the beach. See full bio