Best mode to pay in Europe/UK?

[Navneet]

I am planning a trip to Paris (France) and London (UK) in September’2010. Please suggest - What is the best mode to buy local stuff and pay for your grocery? –
1- Indian Credit Card
2- Cash in local currency
3- American Express Traveller Cheques

[Master]

Cash is BEST mode always. But because there are risks involve in carrying and keeping it safe, so you can split between all the three mentioned in your post. Most of the Indian credit card with International tag can be used but still you will have to pay the currency conversion charges. But always avoid withdrawing cash from the ATM using credit card, because you have to pay interest from the day you withdraw the cash. The drawback with Travellers cheques is that they cannot be encashed after merchant hours and not all outlets accept travellers cheques.

[Matrix]

You may also try prepaid currency cards. Just top-up and use as local debit card. Almost all the big banks issue them now a days. E.g. Citibank, HDFC Bank, ICICI bank etc.
Card ChargesHDFC charges Rs 150 on the USD card while ICICI Bank and SBI Bank charge Rs 110 and Rs 150 plus 12.24 per cent of amount respectively. The reload charges in case of SBI, ICICI Bank and HDFC are Rs 100, Rs 55 and Rs 100 respectively.

[Master]

Avoid using prepaid currency cards, they charge you at the time of loading the top-up, every time you use it and even when you surrender it back to bank after returning back to India. And one big problem with them is the run out of balance, when you are holidaying abroad. You cannot reload from abroad. What you could do, instead, is ask your family members back home to fill up the necessary forms for reload of your card.

[Navneet]

What is the difference between Credit Card and Prepaid Foreign Currency Card?

[Master]

What is the difference between Credit Card and Prepaid Foreign Currency Card?In case of an international credit card, you are billed at the rate of exchange prevailing on the date when you made the purchase on your card. However, in the case of a prepaid card, you would be spending at the rate as on the date you loaded your card, which would be much earlier than your journey date.

[Navneet]

Thanks a lot guys for your help in solving my queries!