Speaker 1: This is a C N A podcast,
Speaker 1: multi currency card, credit card or cold hard cash. When
Speaker 1: traveling
Speaker 2: multi currency cards,
Speaker 1: Top three things to consider when choosing a multi currency app.
Speaker 2: What are you gonna use your money for charges? And
Speaker 2: how many currencies you have access to? Will
Speaker 1: you ever travel without cash ever again?
Speaker 2: I'll bring my cash along some of it. At least
Speaker 1: it's the Money Talks podcast with me Andrea Hing. Now,
Speaker 1: when planning for a holiday, do you find yourself bringing
Speaker 1: less cash to the money changer or perhaps you're not
Speaker 1: even going to the money changer at all? That's because
Speaker 1: multi currency cards and their accompanying mobile apps have made
Speaker 1: it so convenient to buy things overseas.
Speaker 1: Now, for the uninitiated, a multi currency account, lets you
Speaker 1: transact in multiple currencies using competitive exchange rates and it
Speaker 1: promises low transaction fees. They're easy to set up and
Speaker 1: are even more attractive. Now due to a stronger saying dollar,
Speaker 1: everyone's traveling now, right? So you can use it even
Speaker 1: for online shopping.
Speaker 1: But how much are we really saving by using a
Speaker 1: multi currency app? How is it different from using your
Speaker 1: good old credit card.
Speaker 1: Let's get some answers from someone who's tried and tested
Speaker 1: various multi currency apps for us. He's co founder of
Speaker 1: Financial website, Dollars and Cents. Hey, Dinesh, welcome to the
Speaker 1: Money Talks
Speaker 2: podcast. Hey, thanks for having me on your show. Glad
Speaker 2: to be here. Now,
Speaker 1: when did you start using multi currency apps? Did you
Speaker 1: start out by
Speaker 1: holding a bit of standby cash in the wallet and
Speaker 1: then also having the app on standby or was it
Speaker 1: full on multi currency at all the
Speaker 2: way, like many I eased into it. So at the start,
Speaker 2: I also applied for a card and then I used
Speaker 2: it on my first trip just to see how it went.
Speaker 2: So I didn't go full on, I carry a lot
Speaker 2: of cash in that instance. But over the years, I
Speaker 2: find myself trusting it a little more
Speaker 2: And also having a little bit more options. I think
Speaker 2: there are about 10 or so kind of multi currency
Speaker 2: accounts and wallets in Singapore. So I have a couple
Speaker 2: of them.
Speaker 2: So I do find myself bringing less cash on my
Speaker 2: overseas trips nowadays. So,
Speaker 1: how many multi currency apps have you tried
Speaker 2: a little bit different? I think they're multi currency wallets
Speaker 2: and then they're also accounts, right. So I think at
Speaker 2: least half of them that's out there and even the
Speaker 2: others that I haven't tried, I've done a bit of
Speaker 2: research on them. What
Speaker 1: stood out for you when trying out all these multi
Speaker 1: currency for
Speaker 2: me. The biggest one was how do we want to
Speaker 2: use multi currency? How do we want to use our
Speaker 2: foreign currencies
Speaker 2: if you're traveling? We primarily just want to maybe exchange
Speaker 2: a little bit earlier than our travel dates. I've heard
Speaker 2: a lot of people, especially those going Japan this year,
Speaker 2: they've seen the foreign currency or Japan exchange rates to
Speaker 2: Singapore being very attractive. So they wanted to change early on.
Speaker 2: So I think that's one use case, you just want
Speaker 2: to keep the multi currency exchange at a good time
Speaker 2: and then use it when you travel. That's one use case.
Speaker 2: The other one is also you want to send either
Speaker 2: local or foreign currencies to a foreign bank account.
Speaker 2: So you want to send it to like an account
Speaker 2: in Australia or Indonesia even that's another use case and
Speaker 2: not all of them can do all the functions. So
Speaker 2: you need to know what you want to use the
Speaker 2: multi currency for either spending traveling, transferring what is
Speaker 1: it? Right? So there isn't like a one size fits
Speaker 1: all type of multi currency application out there. I think
Speaker 2: possibly there are a few but depending on your needs,
Speaker 2: you may want to hold one or two to serve
Speaker 2: different functions as well.
Speaker 1: So are the exchange rates on those multi currency cards
Speaker 1: or apps or accounts really much better than say, exchanging
Speaker 1: money at the arcade old school, which is probably the
Speaker 1: best place to do so in Singapore, right? That's where
Speaker 1: everyone flocks to and you want to change money,
Speaker 2: correct?
Speaker 2: So we did an interesting article, we literally wanted to
Speaker 2: see whether the arcade exchange rate was superior to the
Speaker 2: multi currency account exchange rate. So we did the experiment,
Speaker 2: someone was at the arcade, someone was on their phone
Speaker 2: seeing the exchange rate, I believe the exchange rate at
Speaker 2: that point was just marginally more attractive if you went
Speaker 2: down to the arcade. But then you have to consider,
Speaker 2: if you're not working around the area, to consider traveling down,
Speaker 2: that would be costly on its own already have to
Speaker 2: make the time to do it. And
Speaker 2: the difference might not even make up for like a
Speaker 2: cap right there. Honestly, it's so marginal.
Speaker 1: So not that big of a
Speaker 2: difference unless you're changing a lot of money. I don't
Speaker 2: think it would make a big dent.
Speaker 1: What about if we compare multi currency cards to credit cards?
Speaker 1: Are they equally accepted overseas? Like those credit card ads
Speaker 1: that we see all the time or convenience and security?
Speaker 1: Would the multi currency cards have the same
Speaker 1: have the same function? I'm
Speaker 2: not an expert on the foreign spending cards, but how
Speaker 2: I think about it is that you certainly have to
Speaker 2: game the system to be able to benefit. So unless
Speaker 2: you're willing to put in that time and effort to
Speaker 2: know which exact cards to spend, how to spend it.
Speaker 2: Which kinds of expenses or brackets of expenses you need
Speaker 2: to spend it on. You're probably better off not using
Speaker 2: your credit cards. So that's how I do it. I
Speaker 2: don't really want to spend all that time energy effort
Speaker 2: to do that just to benefit from
Speaker 2: maybe getting the extra cash back or points.
Speaker 1: Okay. But how much are we really saving in terms
Speaker 1: of transaction fees then? So
Speaker 2: I think if you are able to game it, you
Speaker 2: might see yourself ahead because you're collecting miles or something
Speaker 2: like that. But let's say those are not in consideration, right?
Speaker 2: Let's just say you're thinking of spending foreign currencies in
Speaker 2: maybe cash or your mobile wallets versus a credit card.
Speaker 2: You are definitely a lot better of spending in your
Speaker 2: mobile wallets, cash because like you mentioned, there's going to
Speaker 2: be foreign currency transaction fees,
Speaker 2: there's going to be conversion fees as well. If you
Speaker 2: do spend in a foreign currency, there tends to be
Speaker 2: at least one if not even to foreign currency conversions.
Speaker 2: So one for your conversion into USD and then back
Speaker 2: into S G D. Right. Right. So you want to
Speaker 2: actually pay in at the end of the day, but
Speaker 2: they would make that foreign currency into U S D
Speaker 2: and then into STD to calculate the amount. So that's
Speaker 2: one way then there's the foreign currency transaction cost anyway.
Speaker 2: And then I know there's always this function
Speaker 2: and when you go on the counter and then you're
Speaker 2: hit with, do you want to pay in your local
Speaker 2: currency or do you want to stay in your Singapore dollars? Right. Yes.
Speaker 1: And I never know which one to choose.
Speaker 2: Yeah. In the same position when it first came out,
Speaker 2: you know, when they first asked me, I remember this
Speaker 2: was a long time ago when they first asked me,
Speaker 2: I didn't have an answer instinctively. I thought if I
Speaker 2: pay in Singapore dollars, that would be better off. But
Speaker 2: having done the research, no, actually you always have to
Speaker 2: pay in the foreign currency. So if you're ever in
Speaker 2: that situation, just paying the foreign currency,
Speaker 1: okay. I'm going to keep that in mind for my
Speaker 1: next trip. So when you were using all those multi
Speaker 1: currency cards and you were traveling, did you run into
Speaker 1: any problems in some places when using
Speaker 2: it? I think the biggest problems you might face is
Speaker 2: one connection to the internet. I was in the U
Speaker 2: S and I wanted to fill up the gas in
Speaker 2: the car. So I was at the petrol station and
Speaker 2: I needed to exchange a certain amount of money. So
Speaker 2: I think
Speaker 2: pay and I had already probably expanded everything in my
Speaker 2: account by the time or maybe I didn't have enough. Right?
Speaker 2: So if I didn't have internet connection or if it
Speaker 2: wasn't very stable, then I couldn't make that instantaneous transfer
Speaker 2: from my Singapore dollar account into my, I was using
Speaker 2: you trip at that point into my youtube account and
Speaker 2: then make that conversion on the youtube app and then
Speaker 2: use my card to pay. Right. So there's a way
Speaker 2: you can do it very
Speaker 2: seamlessly and not have to keep additional foreign currency then
Speaker 2: you absolutely need. So internet connection is one of them.
Speaker 2: The other one is certain places might not accept cards.
Speaker 2: You know, if you go to a market, you go
Speaker 2: to certain countries where you can't really find a widespread
Speaker 2: availability of card acceptance.
Speaker 1: The digital infrastructure is not quite there.
Speaker 2: Yeah. So that might be an issue
Speaker 1: as well. I think it really depends on where you're going.
Speaker 1: You need to be really
Speaker 1: at the end of it all. It doesn't hurt to
Speaker 1: have that standby cash in your pocket.
Speaker 2: Yeah, I mean, I would advocate everyone brings standby cash
Speaker 2: for sure. The cash kind of supplements the cards you
Speaker 2: spend primarily on the cards and then your cash is
Speaker 2: just back up emergency, whatever you call it. Was it
Speaker 1: strange to have to whip out cash to pay for
Speaker 1: stuff when you are traveling? Do you think you'll ever
Speaker 1: travel without cash ever again?
Speaker 2: It was a recent trip. I went to Langkawi. It
Speaker 2: was a very last minute trip for me. Actually, I
Speaker 2: booked on the day itself. My wife was actually supposed
Speaker 2: to go and one of her friends backed out on
Speaker 2: the day. Itself. And then my wife was distraught and
Speaker 2: just looked at me saying she can't travel. I was like,
Speaker 2: yeah, sure, I'll go booked on the day itself. I
Speaker 2: didn't have any Malaysian ringgit with me and I went
Speaker 2: there at the airport. I didn't have any money to
Speaker 2: take local cab back to the hotel, but I could
Speaker 2: book it on, grab link my card and just pay
Speaker 2: for it in foreign currency.
Speaker 1: So this is what you mean about gaming the system, right?
Speaker 1: This is another way of doing it without actually having
Speaker 1: cash available.
Speaker 2: So you wouldn't
Speaker 2: to be able to pay for cap right in your car, right?
Speaker 2: But since I had no other choice and grab is
Speaker 2: available there, I could have linked it to any other.
Speaker 2: Let's say I was in the U S. I linked
Speaker 2: it to the lift at at the airport itself. So
Speaker 2: that was fine. So in the digital age that we
Speaker 2: live in today, I don't think it's a big barrier anymore.
Speaker 1: On that note, you said you have to at the
Speaker 1: current moment and you've tried about half of what's out
Speaker 1: there in the market already.
Speaker 1: Should we be getting more than one multi currency card
Speaker 1: or account? The same way some of us have multiple
Speaker 1: credit cards and multiple bank accounts
Speaker 2: for me. I say why not? So I do use
Speaker 2: to predominantly but you could even want something that's linked
Speaker 2: to your local bank account. So even DBS and you'll be,
Speaker 2: they have,
Speaker 2: there are multi currency accounts and mobile apps as well.
Speaker 2: So if you use, you'll be bank and you want
Speaker 2: your multi currency to be quite seamless, then I think
Speaker 2: it makes sense. So you don't need a separate app
Speaker 2: as well. But if you already comfortable using an app,
Speaker 2: there's no reason that you need to immediately change. I
Speaker 2: think it's based on how comfortable, how convenient it is
Speaker 2: for you.
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Speaker 1: So I read that I can also use a multi
Speaker 1: currency card to shop online. So right now when I
Speaker 1: shop overseas website, so any foreign website where I'm looking
Speaker 1: to buy something
Speaker 1: right now, I'm just paying the converted sing dollar price
Speaker 1: on the website because it detects where I'm located, which
Speaker 1: is Singapore. So it shows me the sing dollar denomination.
Speaker 1: That's the converted price I'm paying when I'm buying a
Speaker 1: bag or clothes from my favorite brands overseas. Am I
Speaker 1: losing money
Speaker 1: doing that? Should I have used my multi currency card? Instead?
Speaker 1: We
Speaker 2: did do this experiment a few years ago now where
Speaker 2: we tried to buy the same pair of shoes three
Speaker 2: different ways. So we did it with like credit card,
Speaker 2: we did it with a multi currency account and we
Speaker 2: bought it in a local versus foreign currency.
Speaker 2: And we did find like one of the most cost
Speaker 2: effective ways is to use your multi currency account to
Speaker 2: pay for it in that foreign currency.
Speaker 1: How was it more effective? Okay. You
Speaker 2: don't save a huge amount. I personally believe you should
Speaker 2: always choose the foreign currency because you might get a
Speaker 2: little bit of a better deal. But in any case,
Speaker 2: I think if you use the website often enough, you
Speaker 2: can flip between the
Speaker 2: to rates and then actually check on your phone whether
Speaker 2: you're getting a better rate. You can literally do that
Speaker 2: within a few seconds nowadays. So you can actually negate
Speaker 2: the effect of that when paying with a foreign or
Speaker 2: multi currency account. The part about credit card, I think
Speaker 2: you definitely worse off if you pay through credit card
Speaker 2: again because of the same charges that we think it
Speaker 2: still counts as a foreign currency transaction and then their
Speaker 2: conversion fees
Speaker 2: involved as well.
Speaker 1: Have you ever encountered paying for something online using the
Speaker 1: multi currency card and it gets rejected because I know
Speaker 1: that there are some U S websites that don't even
Speaker 1: accept our Singapore credit cards. So, have you heard of
Speaker 1: any stories or experiences where the multi currency card gets
Speaker 1: rejected for the same reason?
Speaker 2: Yeah, I'm just reaching out for my multi currency car.
Speaker 2: It states Mastercard on it. So it should be on
Speaker 2: the Mastercard Network. I haven't encountered it to be honest
Speaker 2: and I think it shouldn't be a big problem because
Speaker 2: it's on either the Visa Mastercard Network as well, which
Speaker 2: is globally accepted or available.
Speaker 1: So then would you say that multi currency apps or
Speaker 1: accounts take all the boxes as the top choice to
Speaker 1: pay for things when traveling or are there certain things
Speaker 1: that
Speaker 1: people need to keep in mind,
Speaker 2: you need to know what you're using the card or
Speaker 2: account for? So once you know, using it from my travels,
Speaker 2: then it's a good way to like exchange money without
Speaker 2: having to keep stacks of it. Maybe you're going to
Speaker 2: Japan this year. You see a good exchange rate today.
Speaker 2: Sometimes we get very caught up in the situation. We
Speaker 2: just want to change our money as soon as possible
Speaker 2: or other times like me, I just don't know when
Speaker 2: is the best time to change it? I don't think
Speaker 2: anyone would know because it's hard to guess. Right. So
Speaker 2: what you can do is you can dollar cost average
Speaker 2: into the foreign currency,
Speaker 2: right on your phone itself. So you don't have to
Speaker 2: continuously go down to the money changer, whether it's arcade
Speaker 2: or somewhere closer to your place. You don't have to
Speaker 2: worry about that because you're never going down anyway, just
Speaker 2: logging into the app and then just exchange it periodically
Speaker 2: until you actually travel. So then you don't have to
Speaker 2: worry about. Are you getting the best exchange rate? You
Speaker 2: just averaging out the exchange rate that you get? It
Speaker 2: gives me more comfort knowing I'm doing that. Then secondly,
Speaker 2: if you want to send it to a bank account overseas,
Speaker 2: so I actually helped my helper in Singapore send money
Speaker 2: back home. I think it's
Speaker 2: much cheaper or more convenient way for her to do it.
Speaker 2: I think she gets a better deal as well and
Speaker 2: she doesn't have to queue up foreign currency transfer or
Speaker 2: use some other methods at home. Sometimes that's costly.
Speaker 1: Um I mean, I've heard of digital remittances. It's a
Speaker 1: very well developed infrastructure now so they can send money
Speaker 1: across and have it converted at more competitive rates. So
Speaker 1: we've talked about using it for traveling. We've talked about
Speaker 1: using it for online shopping.
Speaker 1: What are the other various use cases of multi currency apps?
Speaker 1: What are the transactions? Can we use a multi currency
Speaker 1: account
Speaker 2: for? I think we can think of it to other
Speaker 2: ways if we just want to hold a foreign currency.
Speaker 2: My wife is from Hong Kong. So actually just holding
Speaker 2: or being able to transfer between Singapore and Hong Kong
Speaker 2: dollars as and when we need so that we can
Speaker 2: transfer it to her local account of her parents context
Speaker 2: in Hong Kong or do it similarly in Singapore, except
Speaker 2: the Hong Kong dollars quite easily.
Speaker 2: I think that's important if you are maybe an expert
Speaker 2: or if you have a very deep connection to another country.
Speaker 2: So I find that that's a useful account to have
Speaker 2: other use case scenarios is maybe you just want to
Speaker 2: hold the currency. So if we have a strong conviction
Speaker 2: that another currency will appreciate or will perform much better
Speaker 2: than Singapore dollars, that's an option. Another scenario that I
Speaker 2: can see as benefiting is if we just want to
Speaker 2: fund our investments with foreign currencies
Speaker 2: because we're getting a poor rate with our brokerage is
Speaker 2: when we make investments. So we want to fund our
Speaker 2: brokerage account with us D rather than funded with S
Speaker 2: G D and then transfer it, make the foreign exchange
Speaker 2: transfer within the brokerage itself. Okay, tell me more about that. Okay.
Speaker 2: So in the past, what was common is you just
Speaker 2: fund your account or pay for your investments in Singapore dollars, right?
Speaker 2: By your investments could be a US dollar or Us
Speaker 2: stock or
Speaker 2: GBP or Hong Kong dollars could be any of these
Speaker 2: foreign currencies, but you have to pay for it or
Speaker 2: you typically pay for it. So the price obviously is
Speaker 2: charged to you after the foreign currency exchange has been applied.
Speaker 2: So if you feel like I'm not getting a good
Speaker 2: deal on this foreign currency exchange that my broker is charging,
Speaker 2: you could opt for other brokers that accept you to
Speaker 2: fund account in USD itself. So
Speaker 1: that means you are sort of
Speaker 1: cutting out the middleman in a way or you're just
Speaker 2: choosing, cutting out the uncertainty of different exchange transfer, maybe
Speaker 2: sometimes you don't really know what the amount is going
Speaker 2: to be. But when you do it yourself, you know
Speaker 2: exactly what the
Speaker 1: amount is okay. That's good advice. Any final parting thoughts
Speaker 1: as to how listeners can think about using multi currency apps,
Speaker 1: things like safety risks. For
Speaker 1: example, I mean, if you're using a smartphone app to
Speaker 1: transact a lot of stuff, obviously, cybersecurity comes to mind
Speaker 1: your money is in there, your card details are in there,
Speaker 1: your personal info is in there. Is that a risk
Speaker 1: we should look at as well? Yeah,
Speaker 2: I think that you hit the nail on the head.
Speaker 2: You have to take cybersecurity very importantly because there's always
Speaker 2: a case where you get scanned or there's a fraudulent transaction,
Speaker 2: which is also why multi currency is great actually because
Speaker 2: you can think of it as you can only lose
Speaker 2: how much you already have in your multi currency account.
Speaker 2: It's not like a credit card where someone's going to
Speaker 2: charge you up to your limit. You can only lose
Speaker 2: what you have inside. Whereas credit card, there might be
Speaker 2: some ways to get back your funds, you know, to
Speaker 2: report the transaction that's fraudulent, you can get it back.
Speaker 2: Whereas in multi currency accounts, you may lose that funds
Speaker 2: and then
Speaker 2: take it up with the provider and then see what
Speaker 2: they can do about it. Right. So there's two ways
Speaker 2: to think about it passing ports. I think once when
Speaker 2: I use my multi currency account, there were some like
Speaker 2: suspicious transactions going on. But as soon as I reported it,
Speaker 2: I think they got to it fairly quickly and they
Speaker 2: reversed the transaction fairly quickly. So I think the ones
Speaker 2: that in Singapore regulated by Singapore authorities, you can trust
Speaker 2: them a little bit. They also don't hold your
Speaker 2: funds, those that aren't banks, they also don't hold your
Speaker 2: funds as part of their operating cash flow. So they
Speaker 2: hold it separately. So they're not using your funds. So
Speaker 2: in case you're worried that company ever goes back to
Speaker 2: what happened to your fund, it's not part of their assets, right?
Speaker 2: They're not going to lose it. And the last thing
Speaker 2: I have to say is that the seeing works very
Speaker 2: well for me because I never know when the best
Speaker 2: time is to exchange my money. And at the same
Speaker 2: time when I come back in the past,
Speaker 2: I always tend to feel like I need to spend
Speaker 2: all my foreign currencies at the airport now because what
Speaker 2: am I going to do with this? Yes,
Speaker 1: you're always looking for the donation tin in the airport
Speaker 1: to get rid of your final bits of cash.
Speaker 2: Correct? Either donated or by a drain. Find something that
Speaker 2: cost the exact amount or as close to the exact
Speaker 2: amount that you have. I think we've all gone through that.
Speaker 2: So two things, multi currency account helps their one.
Speaker 2: You can just not think about spending it. You can
Speaker 2: just transfer everything that is important country back to Singapore
Speaker 2: dollars to use it here without much of a transaction cost.
Speaker 2: I think it's quite competitive.
Speaker 2: Secondly, you can always just hold it there. It's not
Speaker 2: like something physical that you store in your drawer once
Speaker 2: you're home and lose it or forget about it. It
Speaker 2: still always sits there and whenever you make a foreign
Speaker 2: currency transactions, let's say you're spending rather than traveling there,
Speaker 2: you can also use it.
Speaker 1: That's right. I guess in a way you can think
Speaker 1: of it as still physical cash that you come home.
Speaker 1: You do put it aside except this time it's not
Speaker 1: going to take up space in your drawer and collect dust.
Speaker 1: It's digital. You don't have to think about it and
Speaker 1: you can just keep it
Speaker 1: and you don't have to worry about whether you're going
Speaker 1: to get laughed at when you bring that small little
Speaker 1: amount to the money changer to get it changed back
Speaker 1: to S G D.
Speaker 2: Yeah. Exactly. You can just change it on your app
Speaker 2: or even spend it
Speaker 1: convenient, cashless and creative. Perhaps multi currency apps are the
Speaker 1: new three CS in the digital age. But are they must? Well,
Speaker 1: if you're into financial hacks could be worth the time,
Speaker 1: we hope you gained some nifty tips and tricks on
Speaker 1: using a multi currency app. And for those, we thank Danny,
Speaker 1: co founder of Financial website Dollars.
Speaker 1: And since, and thanks to you to our listener. If
Speaker 1: you've enjoyed this episode of Money Talks, there's more content
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Speaker 1: or Spotify and give us five stars or leave a
Speaker 1: review while you're there. The team behind Money Talks is
Speaker 1: Joanne Chan, Jacqueline Chan Christina Robert and I'm Andrea Ping.