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

Whether you’re planning to explore the cobblestone villages, relax on the golden beaches or indulge in the local cuisine, organising your travel money in advance is crucial to a successful trip to Portugal.

Low cost travel money options for Portugal

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Can I use my debit card in Portugal?

Yes, you can use any Mastercard or Visa-branded debit card in Portugal, though you should be wary of using it abroad as there may be fees attached. It is worth checking the fees that your bank charges for overseas transactions or look for a debit card with low or no overseas fees. You could also search for a debit card with low transaction fees to use separately when in Portugal.

• Tip: Portuguese multibanco ATMs are fee-free. This means that if you choose a product that doesn’t charge international ATM withdrawal fees or currency conversion fees, you can make withdrawals for a similar cost as you would in the UK.

Using prepaid travel cards

The euro is a supported currency on all travel money cards. To get the best value travel money card, compare their fees, which can include charges for ATM withdrawals and for loading and reloading money on to your card. You can lock in a rate when you transfer pounds to euros, which can be handy if you think the value of the pound is going to drop. You can also avoid ATM charges by choosing a product that doesn’t charge for international ATM withdrawals. Portuguese bank ATMs are generally fee-free.

Using credit cards

A travel-friendly credit card will allow you to make day-to-day payments in Portugal without the charge for currency conversion. They can also supplement your travel budget with perks that would ordinarily be an out of pocket expense, like travel insurance, for example. Credit cards also offer interest-free days on purchases when you pay your statement in full by the due date.

• Tip: Avoid using your credit card for ATM withdrawals. This is a cash advance. Cash advances accrue interest at about 20% p.a. from the time of the withdrawal, and you’ll pay a cash advance fee. Accruing too many cash advance fees in a short space of time can also negatively impact your credit record.

Using traveller’s cheques

It will be difficult to cash traveller’s cheques in Portugal. Banks and exchange offices won’t usually accept traveller’s cheques. Use the right credit card, debit card or a travel card instead. These travel money products offer all the advantages of traveller’s cheques and none of the drawbacks.

Taking cash with you

While Portugal has all the facilities to accept card payments you’d expect from a modern economy, there are going to be many instances when you need cash on your trip. Some places won’t take cards if you’re spending less than €10 – €20 Euros, while other merchants won’t take cards at all. Banking reforms in Europe have made it cheaper than ever to make withdrawals from bank ATMs, and if you pick the right card, there’s no reason why you shouldn’t have euros in your pocket.

• Tip: While most supermarkets in Portugal will let you pay with your card even for transactions of only a couple of Euros, the Pingo Doce supermarket chain won’t accept card payments for transactions under €20.

If you’ve brought pounds sterling with you to Portugal, you won’t have trouble getting your cash changed to euros on the street. They are frequent in bigger cities and touristy areas. The worst rates will be at the airport or inside hotels, while the best will be at independent offices in larger towns and cities. Most banks no longer offer foreign exchange services.

• Tip: Following the EU’s austerity measures, Portugal raised its VAT (value-added tax) rate from 19% to 21%. In March 2021, the standard rate then increased to 23%. Like everywhere in Europe, if you are leaving within 3 months of purchase, you can claim the tax back by requesting a form named “Isenção de IVA”. Upon your departure, present this form to customs for a refund.

How many Euros do I need to bring to Portugal?

While Portugal is not as cheap as it used to be, visitors will find it much cheaper than destinations in Western and Northern Europe. Accommodation and shopping will be where you spend (or save) your money. If you prefer to stay in hotels your estimated travel expenses will be much higher than someone else who stays in hostels. Food, even eating out, and travelling from A to B are quite affordable all over Portugal. You will be able to find budget accommodation, food and activities right through to 5-star treatment.

	Basic costs	Mid range	A royal experience
	Hostel £10 – £20 per night	2-Star Hotel £60-£70 per night	5-Star Hotel £150-£350 per night
	Casa de pasto £5 – £15 per dish	Restaurant £12 – £25 per dish	5-Star Restaurant: £30 – £50 per dish
	Free entry to most museums Free sightseeing ancient ruins and castles	Lisbon Oceanarium £21 for an adult ticket	Guided 7-day & night bike tour of Portuguese castles and vineyards (expenses included): £6,000+

_{*Prices are approximate and subject to change.}

Exchange rate history

The GBP currency pair has been relatively unstable over the last five years, thanks to recent political events such as Brexit. Travellers to Europe from Britain will find that £1 is equal to around 1.1 Euros. If you think you know whether it’s going to be more expensive or cheaper to buy Euros in the future, you may want to lock in the exchange rate using a prepaid travel card.

Should it be a travel card, a debit card or a credit card?

The national currency of Portugal is euros. Conveniently, all travel cards let you load and hold euros. Most European countries, including neighbouring Spain and France, also use the same currency, so a travel card can make sense if Portugal is one stop on a European vacation, but how does a travel card stack up against a debit or credit card?

Visa and Mastercard can be used everywhere (look for the Visa [Plus] and Mastercard [Maestro/Cirrus] logos on ATMs and card terminals). Advances in contactless payments now mean you can also use your credit or debit card for small purchases at major Portuguese retailers, which somewhat eliminates the need to make ATM withdrawals.

• Tip: Most Portuguese bank ATMs (multibanco) do not charge a local ATM operator fee, you should look for a product which doesn’t charge for international ATM withdrawals as well as currency conversion to withdraw on the cheap in Portugal.

A quick summary of travel money options in Portugal

_{This table is a general summary of the travel money products in the market. Features and benefits can vary between cards.}

A guide to Portugal banknotes and coins

Buying currency in Britain

You can take as many euros with you to the European Union as you want. You have to declare if you’re carrying more than €10,000 cash. This includes bank notes and traveller’s cheques, gold bullion etc. It’s easy to buy euros in the UK, as you can exchange pounds to euros in almost any high street or online travel shop, as well as in the airport.

Why you’ll need a combination of travel money options

Having a combination of travel money options is the best way to mitigate risk and finance your trip to Portugal. Whilst debit and credit cards are widely accepted and used in Portugal, there are many instances where there will be a minimum transaction or times where card won’t be accepted at all – so it’s always a good idea to have some cash on you.

One of the main differences between these travel products is the exchange rate. It can make sense to load funds and lock in a rate on your travel card if you think euros are going to get more expensive to buy in the future. As always, you might want a credit card for emergencies as well as access to different travel perks such as complimentary insurance and rewards, however, never use a credit card for ATM withdrawals

Portugal is truly a beautiful travel destination, so whether you go for the sun, the olives or to explore the ancient cities of the once great imperial power, compare and apply for the right travel money so that you can have peace of mind that you won’t get smashed by fees when withdrawing money or making purchases using your cards.