How to choose the right credit card, curb expenses while traveling

Benefits of Travel Card: Travel cards generally offer a bouquet of benefits for travelers.

some of them are: Reward Points/Cashback: You get reward points or cash back for every spend you makeRavel Credit Card. Sachin Vasudev, associate director and head of credit cards at paisabazaar.com.com, said, “Most travel credit cards offer reward points in the form of joining and renewal benefits. These benefits can help in recovery of joining and renewal fees in part or in full. The benefits derived from such free complimentary tickets can sometimes exceed the cost of joining and renewal fees. It is therefore important that you compare the monetary value of your travel credit card joining and renewal benefits and choose the one with the highest potential to recover or exceed the cost of your card.”

Airline lounge access and flight miles: You receive air miles for spending made through your travel card. Some cards also offer bonus air miles when purchasing the card. Adil Shetty, CEO, BankBazaar.com, said, “You can convert air miles into future travel purchases, including airfare, hotel accommodation, ground transport, travel package deals, etc. The value of air miles depends on your usage. In addition, travel credit cards also offer complimentary lounge visits at both domestic and international airports.”

Low Forex Mark-up Fees: Foreign mark-up fees are usually charged to your travel credit card when you buy things abroad. There are travel cards that charge up to 3.5% as mark-up fees and, on the other hand, there are cards that charge mark-up fees as low as 2% or 1.99%. For example, SBI Card Elite charges 1.99%, and HDFC Regalia Credit Card charges a 2% mark-up fee. On the other hand, Axis Vistara Signature Credit Card and Air India SBI Signature Credit Card charge 3.5% as mark-up fee.

Bundled Travel Insurance: Travel credit cards provide you with a comprehensive insurance cover to protect you against unforeseen expenses that may arise due to air accidents, health emergencies, loss of passport, baggage, etc. For example, the Axis Vistara Signature Credit Card and the Citi Premier Miles Credit Card can offer you air accident cover of up to Rs. 2.5 crore and 1 crore respectively.

Ways to make the most of your travel card

Free cards with reward points are less generous: When you choose a travel credit card, the point is to accrue air miles through your eligible spenders so that they pay for the ticket. Hence, the more you spend through the travel card, the more benefits you get.

Shetty said, “You can be sure that any premium card will pay you more than the annual fee, provided you use it correctly. The fees start with 499 and can go into the thousands. The higher the card premium, the higher its fees and the value of its benefits. These premium benefits will not be available on regular credit cards or free cards. The free cards will also be geared towards basic benefits such as fuel surcharges or a reduced number of lounge entries. Of course, without the card, you are deprived of all these benefits.”

Choose a co-branded card if you prefer the airline: “Broadly you can divide travel cards into co-branded cards with airlines and generic travel cards. The latter will give you extra points on travel compared to other expenses, but travel is not tied to any particular airline. If you prefer an airline, its co-branded card is a better option for you than a normal travel card,” said Ajay Avtani, editor of LiveFromALounge.com, a digital platform focused on Indian credit cards. The risk of losing points if the airline stops operating is their value. Take the case of Jet Airways. The issuance of reward points was switched to a different company and when points kept running out, they lost a lot of value. For example in 2011, 180,000 points would get me a Mumbai-New York return ticket. Now you will need 6 lakh marks for this,” Avtani said.