Both methods work in Thailand, but they’re not equal. For most travelers, a credit card is safer and often cheaper overall—especially once you factor in deposits, dispute rights, and exchange costs. Cash can still make sense in a few cases.
When a credit card wins
- Safer deposits: Rentals place a refundable hold instead of keeping your cash. If anything goes wrong, you have chargeback rights.
- Better paper trail: Itemized receipts and digital records help with disputes.
- Extra perks: Some cards include travel protections or collision coverage (check your issuer’s terms).
- Convenience: No need to carry large sums or visit ATMs.
Potential downsides:
- Foreign transaction fees if your card charges them.
- Dynamic Currency Conversion (DCC) at the terminal can add hidden costs—always ask to pay in THB, not your home currency.
- Holds can tie up your limit for several days after return.
When cash might make sense
- No card or low limit: Cash can be a practical fallback for deposits or small balances.
- Avoiding card surcharges: Some local providers add a small card fee—ask before you pay.
- Immediate deposit return: With reputable rentals, cash deposits are often returned on the spot at checkout.
Risks to watch:
- Safety and loss/theft when carrying large amounts.
- Weaker dispute position if charges are contested.
- Exchange rates and ATM fees can quietly wipe out any “savings.”
Debit cards
- Often accepted for payment, but not always for deposits.
- Holds on debit cards lock up your actual funds and may take longer to release than credit.
Cost traps to avoid
- DCC: Always choose to be charged in Thai baht (THB).
- Unexpected surcharges: Ask about card fees, admin fees, or “loss of use” charges.
- Deposit timelines: Confirm how much, how it’s held, and the release time.
- License requirements: Lack of a valid license/IDP can void insurance, making any payment method irrelevant in a claim.
Practical recommendation
- Use a credit card with no foreign fees; pay and authorize deposits in THB.
- Carry a small amount of cash for parking, tips, and emergencies.
- Get a written, itemized agreement and keep deposit/return receipts.
- Photograph the car at pick‑up and return to reduce disputes.
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