OneSmart, Air New Zealand's pre-paid travel card, sounds like a good idea. But what's it like when you actually want to use it? Does it work everywhere you want it to work? Is it cheaper than using a credit card, or using your ATM card to withdraw cash?
The answers are surprisingly complicated ...
In the last couple of months I've been to Holland, England and Australia. I gave both MasterCard and OneSmart a bit of a work-out and perhaps busted some myths.
Myth one: MasterCard is not as widely accepted as Visa. Busted. Everywhere I offered my MasterCard it was accepted, and that includes the US and Canada on a previous trip.
Myth two: OneSmart works in all ATM machines. Nope. Not at the first one I tried at Amsterdam airport anyway. But it did in the second brand of ATM I tried. Trying to buy a train ticket to get into the city proved challenging. It turned out that only Dutch debit cards work in Dutch ticket machines, so back to the MasterCard which copped a 0.5 euro fee plus the usual currency conversion charges.
Other than that OneSmart was reliable. Mostly I was asked for a PIN – I only met PayPass (no PIN required) twice, at a bookstore in Notting Hill and a bottle store in Adelaide. Surprisingly OneSmart worked just fine in the Australian outback. I withdrew cash at Marree and paid for camping at Wilpena Pound and for lunch at Parachilna. You can't get much further into the "sticks" than Marree – I was surprised to find an ATM. It had to be tested!
It's worth knowing that eftpos systems treat OneSmart as a credit card and you'll often get a message on the ATM screen warning you of cash withdrawal charges. ANZ machines at Sydney airport said there were two fees because it was a foreign credit card - $5 all up - so I chose not to withdraw. But despite a fee warning, there was no charge at a BankSA ATM in Adelaide. In outback Marree at an unbranded machine it was $2.50, but 50 cents more at NAB in central Adelaide. I can't see much logic to the fees, or a simple way to find out whether you'll be charged or not. Expect the worst when taking out cash.
So, the big question: is OneSmart cheaper or dearer than using a credit card or withdrawing cash from an ATM? I didn't try withdrawing cash using my eftpos card on this trip, but past experience is that charges are similar to the credit card.
Between a credit card and OneSmart, it depends mostly on what happens to the exchange rate. As an example, on the 7th of October I loaded Australian dollars to OneSmart's Aussie "wallet" at a rate of 0.7826, which fixed the cost of my Aussie cash dollars and OneSmart purchases. On the 8th and 11th of October I bought diesel on MasterCard at 0.7829 and 0.7830 (including taxes and conversion fees). So from the 7th to the 11th there was just 0.05% or almost no difference between the cards.
By the 19th of October, the exchange rate had dropped by 1.3 cents or 0.0130, which means MasterCard purchases would have cost 1.6% more than using cash from OneSmart. Luckily – we were back home! As one of our commentators has pointed out, being able to fix your overseas currency in advance is one of the benefits of OneSmart. If you can lock in overseas money at a good rate, it's even better.
Disclosure: We paid our own air fares to Adelaide on Air NZ and Virgin Australia. I’ve always wanted to write a travel article and say this at the end!