WITH the spread of electronic settlement systems linking banks across the world, plastic cards have moved closer in the challenge to travellers cheques as the best way to spend money abroad.

Holidaymakers visiting most of continental Europe and the US can rely on the same credit and charge cards they use at home. Such cards are widely accepted for purchases, and can be used to withdraw cash from machines using your normal personal identification number.

As more banks sign up to international payment systems - and offer cash machines badged, say, with the Access or Visa logo - this becomes easier. Last year cross-border cash withdrawal increased by 40 per cent.

In Britain and much of Europe, banks are now offering debit cards badged with the Visa logo. However, Irish banks are still looking at how they will develop these cards. Both AIB and Bank of Ireland have recently introduced "Laser" debit cards but these cannot be used abroad. A spokesman for Bank of Ireland said it is concentrating on getting the card off the ground and may then look at international badging.

Card acceptance varies. In Greece, two times as many cash machines accept Visa than Access - the Irish version of the Mastercard In the Netherlands two times as many take Access.

American Express and Diners Club, which are charge cards tend to be accepted in few cash machines in Europe, but lots in the US and Spain.

Eurocheques are cheque books, backed up by a Eurocheque card which can be used in some cash machines but a recent spate of fraud in France has made many banks there unwilling to accept them.

When you exchange a traveller's cheque or pound note for foreign currency you pay two costs - a commission rate (say, 1 or 2 per cent) and a load over money market rates (essentially a profit margin.) Exchanging cash a reputable bureau de change wild load rates with a charge of between 2 per cent and 3.5 per cent on popular currencies. Poor exchange rates suggest a fat load over the money market rate.

With plastic there is no commission as such - but you still pay in different ways.

There is no set charge for Visa or Access - it depends on the bank issuing the card.

The major banks charge one fee to exchange money, and an extra fee if you withdraw cash.

It is better to pay direct with a card than to withdraw cash and then pay for the same item in notes.

If using a cash machine, it is better to use a debit rather than a credit card. Most credit card issuers will charge interest from day one on a cash advance - even those that offer an interest-free period tend to backdate interest if you do not clear your balance.

One way around this is to lodge money to a Visa account before you go. If the card is then in credit you will not be charged interest on any withdrawals.

If you are travelling to most of Asia, Africa, Latin America, or eastern Europe, travellers cheques are a much better bet. In the remotest parts, just take cash - but not Irish pounds. Deutschmarks are king in the Balkans - elsewhere the dollar reigns.