Which is better??

Just like anywhere else you might go at home or abroad, use whatever you want, cash or credit card. Smaller shops where you will make small purchases would often rather that you pay in cash, same as where you live.

To save money, do what all smart travelers do: get your cash from an ATM over there, using your debit card from home (give your bank a heads-up before you go so they won't lock your card suspecting fraud). Find out what your bank charges for foreign currency withdrawals (if there are any per-withdrawal fees - there shouldn't be - and if they impose a foreign transaction fee - good banks won't.)

Use credit cards that have zero foreign transaction fees (find out if yours does, and also give them a heads-up about your travel plans).

Bring at least 2 credit cards and 2 ATM debit cards, so if one goes belly up, you still have backup.

Don't throw away money by "exchanging" it, ether at home, at an airport, or after you get to your destination.

In general (not specifically in Scotland), we use credit cards for flights, hotels, car rentals, and sometimes an expensive dinner or major purchase. We use cash for everything else, and also for smaller B&Bs that prefer it. Some hosts and merchants put a surcharge on prices when paid by card, to cover the fees they must pay the card issuer. We get the cash from local ATMs, taking out as much as possible at a time since there's usually a fixed fee for a withdrawal.

The "exchange rate" is a daily fluctuating ratio between currencies which none of us can control or predict, but it seldom varies more than a small amount from day to day, or month to month. You'll get the best exchange rate, the one banks use between each other, by drawing cash from an ATM. But what really matters to the bottom line are the fees banks and card issuers charge, which are separate from the exchange rate.

Frequent travelers sometimes recommend credit cards and banks that don't charge foreign transaction fees. I think one of these is Capital One, others are certain credit unions. We just use the cards and banks we use at home since we don't travel enough, or expensively enough, for those fees to make much difference. Other posters will probably share what they know about this.

EDIT -- Also, what David said above.

Both have their place:
https://www.ricksteves.com/travel-tips/money/pay-credit-cards-vs-cash

A card with no foreign transaction fee is a good thing to have, and plan on getting cash from an ATM after you land. Many people like to have a small amount before they travel, but £ will cost you more if you buy them at home, so don't get too much.

Scotland has its own currency which is supposed to mirror the cash used in the rest of the United Kingdom. There are stories, however, of merchants down south giving the evil eye to Scottish pounds. I don't know what Scottish ATMs will cough up, but for the sake of easy exchange before departure, I think I would prefer UK sterling. If you are only visiting Scotland, I would give some attention to how much cash you need so it runs out more or less when you are running out of vacation. But certainly depend on ATMs, which offer pretty uniform exchange rates whatever the currency. And keep in mind it is usually your own bank that imposes user fees.

Scotland has its own currency

No it doesn't. It uses the pound sterling like everywhere else in the UK. Three commercial banks are allowed to print their own pound banknotes and are acceptable throughout the UK.

Hi, ramblin' on,

True dat, but don't ever try using a Clydesdale Bank 10 pound note in Cornwall! :)

@Kathy,

Everyone has given good advice - Scottish banks don't charge for a withdrawal from an ATM, so if your home bank does charge a fee for a foreign ATM transaction, take out as much as you feel comfortable carrying with you each time you make a withdrawal.

As you get closer to the end of your holiday :( take out just as much as you think you'll need to tide you over until you get to the airport. The Scottish banknotes are very colorful and provide brief history lessons. You'll probably want to take a few back with you as souvenirs, or to save for your next holiday. And there will be a next one!

Bank of America's Travel Rewards card is another good card which doesn't charge foreign transaction fees. No annual membership fee, either!

Best wishes,

Mike (Auchterless)

One additional consideration you might want to think about is that fewer places in rural Scotland accept American Express than Visa/Mastercard. This is because of the high commission rates charged by American Express to businesses. For example here on Skye the only places I know of that accept American Express are the COOP supermarket and the Three Chimneys Restaurant.

Scottish notes are accepted throughout the UK, although some very small establishments might turn their noses up at a Scottish note. ATMs in Scotland dispense Scottish notes.

Thank you all!!!!

Thank you for all your comments!! I have checked with banks and credit cards and their fees - NO FEES!!! It would be just as easy to get money out of atm's there it seems , as it would to exchange before I go. I like the comment about using credit card for the hotel and car rentals(big expenses) and cash for everything else.

I have read on RS sites about being very careful of carrying money, that there are lots of pickpockets(Not exactly sure which areas of Europe) around. Would it be ok to use a small carry bag for daytime or a bag similar to a Vera Wang fanny pack, like this -

https://www.ebay.com/itm/233191010306?ul

Thanks!!
Kathy

There are no more pickpockets in Scotland than anywhere else in the civilised world! Indeed I feel safer here in Scotland than in many cities in the USA (NY, LA, San Francisco, etc etc). Just take sensible precautions as you would at home.

Any Scottish bank printed notes I had, I tried to use before reentering England, but didn’t have any problem spending the rest in England; £20 is £20. Anyway, we use a mixture of cash and credit cards on trips. There are still some mom and pop places that don’t accept credit cards. Pickpockets can be anywhere and everywhere. That advice is general advice to be aware of any time you travel. There are places where you should watch your belongings more, e.g., busy trains, crowds, festivals, etc.

@Kathy,

If you're at all concerned about carrying large amounts of money around in Scotland, you needn't be. Outside of the major cities, you don't need to worry about pickpockets, and even in the cities, only if you're in a crowded situation. Just take the same precautions that you would anywhere - don't leave your purse out in the open, and don't flash a lot of money in public places (shops, restaurants, etc.).

B&B owners will appreciate cash, so that they don't have to pay the 3% merchant fee. I see that now some B&B owners will add that fee to the cost of the room if it's paid for using a credit card.

BTW, best not to refer to a "fanny pack" in Scotland, as "fanny" has a whole different meaning in Scotland than it does in the US. The Scottish/British term is "bumbag."

Slainte!

Mike (Auchterless)

Hi, ramblin' on,

True dat, but don't ever try using a Clydesdale Bank 10 pound note in
Cornwall! :)

Done that. The reply when they look at you funny is 'of course it's genuine, I only printed it this morning'

That said Andy Murray's mum had trouble buying some donuts in a shop in London with an RBS £10

And yet earlier this month I spent Scottish 20-pound notes all over Cambridge and London. :) One person took an interested look at it, but no problems with acceptance. I always have about 50 pounds with me when I arrive. I guess I will always remember running into problems with ATMs on one occasion and the last thing I want to do after a trans-Atlantic flight is, hunt down an ATM! It's my insurance money. On this last trip, it was left over Scottish 20 pound notes from a too exuberant withdrawal in Scotland last year.

Also, the exchange rate has been within a few cents of 1.30 for the last year. I know this as I am in sales for Cambridge University Press and we do parity pricing for our books. (Which BTW has been a great deal for North American students ever since we figured out what Brexit was doing to wholesale purchasing patterns. It's been an education! Our finance author told me that I now had a better understanding of arbitrage which has been a lot for this former biology major.) So, basically, I expect until they resolve Brexit the exchange rate will hover around 1.30. If someone has other info, let me know, so I can check my pricing. :)

Thank you all!!!
Thank you for all your comments and advice!! PLEASE let me say that I, in no way, meant any disrespect to the country or people of SCOTLAND with my comments about pickpockets!!! I guess I read to much of RS's book!!! I am sure that there are mischievous people every where that want to help themselves to others belongings if they can. ( And for those that do...hopefully for them payback/justice is soon coming). I rarely carry more than a small wristlet anywhere I go. That is my purse. And THANK YOU Mike, for the comment on the term "fanny pack"", I forgot that it meant something ENTIRELY different in Scotland :))
I do like the idea of having a little bit of the country's currency with me when we arrive, but if ATM's are readily available, then it might be ok to wait until I get there to get money. With all the advice about B&B's, I believe I will contact each one and ask which payment type they prefer. If cash, so be it! That might be better anyway since my friend and I are both paying the expense. Again, if I offended anyone, I seriously apologize!!! No offense meant.

Thank you all (AGAIN)!!!!
Kathy

As a matter of practicality, my husband and I have developed a routine. While he is waiting to grab our bags at baggage claim, I am getting cash from an ATM. That way we are ready to head out without delay! We are only taking carry-on on our next trip, so I guess we'll just have to find an ATM and off we go!