2024-01-17 17:09:42
Gestión spoke with Gustavo Martínez, a tax expert at TPC Group, and indicated that “it will depend on the destination and the difference in the value of the currency of the destination country.”
“If you travel to Mexico, the Mexican peso against the sun has a greater value, but against the dollar, it is vice versa; The dollar is higher against the Mexican peso. Then the exchange rate must be taken into consideration. If you have savings in dollars, spending in a currency that has a higher value will definitely help you save a little more. The Mexican peso has a lower value and mainly due to the fluctuation of the exchange rate,” he said.
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Positive and negative aspects of using a dollar credit card
Positive:
- Stability in savings: You can avoid, in operations with that currency, the variation of the exchange rate, since the dollar is present in almost all countries.
- Ease of comparing prices: comparing the value of a product or service in the currency of the destination country with the currency of the country in which you reside is complicated. Therefore, paying in dollars allows you to easily calculate how much what you are buying costs you.
- Projection: Being in a country that uses the dollar more, it is important to use these credit cards in this currency because the fluctuation or transactions of operations in dollars are simpler.
Bancom also adds some points in favor of using credit cards abroad.
- Additional Protection: Purchase insurance and travel insurance are benefits that credit cards provide. If there is a problem with the purchase, the money can be recovered. Additionally, in terms of security, a credit card in the event of loss or theft can be reported and unauthorized charges prevented.
- Discounts: Most credit cards offer promotions, rewards programs, additional benefits or discounts that would not be available if paying with cash, for example, travel insurance or purchase insurance.
Experts analyze positive and negative aspects of using credit cards in dollars abroad. Photo: ResolveYourDebt
Negative:
- Unfavorable exchange rate: in other countries, the exchange rate may be unfavorable and using the card in dollars to pay for the transaction in a local currency can generate financial impact.
- Bank fees: Banks can charge for each transaction made. Online or through an ATM, commissions are relevant when using the dollar currency at the local currency exchange rate.
- Fate influences: sometimes the dollar is not easily accepted. Not all establishments accept payments in this currency and they are only made in the local currency.
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Situations in which it is convenient to pay under this modality
Gustavo Martínez considers that it is convenient to use credit cards in dollars in countries with dollarized economies, such as the United States or Canada. In the case of Latin America, this modality can be taken into account if you travel to Ecuador, since it has a dollarized economy.
It is important to highlight the places where the credit card in dollars is most likely to be accepted, such as “restaurants, lodgings, accommodations, Airbnb. This application helps determine the value in dollars and if one has savings in dollars it will be easier and the change will not be harmful.”
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Recommendations to avoid overdrafts on credit cards
For his part, Arturo García, economist and professor of Finance at ESAN, mentions some recommendations to take into account when using a dollar credit card, if you do not want to pay high fees in subsequent months.
- Using the card as a means of payment: many people use it as a means of financing. So, we must keep in mind that when you travel abroad on vacation, it is a planned trip and you must have saved for this trip. After using the credit card, the installments should be paid immediately and not just the minimum amount.
- Savings in dollars: you must save here in the currency in which you are going to make the payment; if you go abroad, you must save in dollars to pay with your debit card. If you use your card in dollars, you must save part of your salary in soles and convert it progressively and when the card bills the payment for dollars, pay it in the same currency, and not with the exchange rate of the financial institution.
- Apply for personal loans: if you have not saved or need to complete your travel bag, you should not finance yourself with a credit card. The recommendation is to take a personal loan for 12 or 24 months in soles or dollars. The credit card is a means of payment, not for financing.
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