Which exchange rate do you use when paying (zar to US $)?
 

Last time, I asked my outfitter to use xe.com. The rate today is 1:702 (dollar to rand). Does that seem accurate and fair to everyone?

That should read 7.02

oanda is showing 7.04ZAR/USD$1.

Doesn't mean that is what you'll actually get, but close enough if using ATM's. What's found on these sites is the bank rate in converting big numbers, not for us folks withdrawing a few hundred USD to ZAR.
For that matter any currency. These figures, whichever conversion site you use, is a guideline.

ATMs probably offer the best rates, then credit cards (but do remember the Foreign Currency Fee most CC charge); hotels are the worst.

Happy travels.

How are you planning to pay and in what currency?

In any case, that's not the rate that you'll be able to get through a bank or credit card company. There will be some conversion loss. The question is which party will bear that loss.

Hi Sandi and Patty,

It's time to pay my outfitter/TA who is in SA. She has listed the price in rand and then, last Friday, quoted an even 1:7 as that day's conversion. I recall in the past asking if she could use xe.com as she had quoted a rate that wasn't as favorable, and she did. She is very good to us and lets us pay with a credit card with no extra fees (because we are good clients, have sent referrals, etc.). So I hesitate to say anything as the diference is only $64. But I wondered how other's TAs (if abroad), did the conversion.

Are they charging your credit card in USD? If so, I think 1:7 is more than fair.

If the charge is put through in ZAR, you're credit card company will process the conversion and they'll charge you at least 1% up to 3% depending on the card.

AE Plat, do you know how much? We also have AE Starwood.

You also might want to double check that your credit card issuer doesn't tack on a 1% fee for <i>any</i> foreign merchant transaction even if the charge was put through in USD. I think some issuers started to do this though it may have later been rescinded. I haven't kept up because I've had very few foreign merchants charge me in USD. Of the rare instances this is happened, the last charge was on my Amex in Dec 2006 so I can verify that Amex doesn't add anything (at least at that time).

Amex charges 2% conversion but I'm still confused. Is your TA going to charge your card in ZAR or USD? Because if USD, then it doesn't matter what Amex adds because they won't be doing any conversion and at least as of Dec 2006, they don't add anything to USD transactions processed by foreign merchants.

If your TA is charging you in ZAR, then Amex will do the conversion and add their 2% fee. But if that's the case, she shouldn't be quoting you an exchange rate because that will be entirely up to Amex.

Thanks to one of Wendy Perrin's articles in Conde Nast Traveler magazine, I now use a Captital One card for all foreign travel (and only foreign travel) as they charge the least extra on international transactions -- no extra percentages. That's about the only good thing I have to say about them. They're awful to deal with, you MUST remember to call before you go or their fraud department will shut you off and you receive even more mail as a customer than you did as a prospect . . . They offer a zillion cards so of course you want one of the no annual fee card. I've heard also (from Wendy Perrin) that their miles are not &quot;real&quot; miles but I don't quite understand that. Caveat emptor, as always.

Patty, our invoice says: amount due in SA rand. But on the side she has done the conversion and said &quot;us exchange rate 1:7&quot; We have a choice of paying into a bank account but we prefer getting the ff mile points (membership rewards). I guess she was using an exchange rate so we'd have a concept of how much we are blowing on this trip! <s> 2% of this is not small change but maybe we'll get points for that too!

Pula, I almost got the Capital card for that reason. However, I found it wasn't going to be worth it as, yes, their miles are not &quot;real&quot; miles. So it's worth it to get a better card for the miles than for this one perk. Also, their customer service is a nightmare. </s>

Please ignore cross-out and read through it. I don't know why my computer does that sometimes.

If I understand correctly then, she will charge your card in ZAR. In that case, the rate she listed is just a guideline and pretty much meaningless? Or do you have some option to pay in USD at the 1:7 rate?

I figure now it was just a guideline.

I can ask but I worry that's pushing it since she's already waiving a usual 5% fee for using a credit card.... And I don't think her getting US dollars is any help to her, living in SA... or is there something I don't know?

My understanding is that charges even in USD in a foreign country (which is often done in Kenya) is still considered for and qualifies for the assessment of the &quot;foreign currency exchange&quot; fee. Amex will charge a fee to:
1) convert from ZAR to USD (whatever rate for that day, regardless the rate your TA advises... she has no control)
2) a fee, as it's a foreign transaction
3) even if charged in USD, you're hit with the foreign currency exchange fee.

They get you coming and going. With the exception of a credit union, Capital One is about the only cc that doesn't charge fees, but as indicate their card seems to be a shill and their customer services is awful.

Unfortunately, when dealing with SA tour operators/agent, most all deal in their currency, ZAR, unlike in East Africa where most TA/TO have USD accounts into which you can wire USD funds.

Assume a $10,000 invoice at 3% for that foreign currency exchange fee = $300 - I do not believe these qualify for FF miles.

While I no longer have an Amex card, friends have complained that when using Amex vs Visa or Mastercard in Eruope, splitting a hotel bill, evenly between the two cards, on the same day, same hour, Amex had the least favorable exchange rate Euro/USD, and a big difference at that.

Clem, I'd verify with Amex the rates they charge for the foreign currency exchange fees and anything else of concern, so you're not surprised.

Personally, for all the fees when using credit cards, even for the FF miles, it's just easier for $40 or less, to simply wire USD.

<i>3) even if charged in USD, you're hit with the foreign currency exchange fee.</i>

Amex didn't add anything to a USD charge from a foreign merchant that posted to my account in Dec 2006 (nor the ones before that).

My primary cards are Amex and Citibank. Citibank adds a 3% conversion fee and whenever I've compared same day transactions, the Amex charges were always more favorable. If comparing with cards that only add 1% or none (does the exist anymore?), then Amex will be less favorable.

Capital One's service IS awful, but for me , it's an acceptable trade-off to avoid the extra charges. I pay the international airfares on another CC so I get &quot;real&quot; miles on that transaction. I happily forgo the miles on the land charges using the (no annual fee) Capital One -- so we all make choices, well-informed ones, thanks to this board -- according to our circumstances.

It's great it's working for you, Pula. If someone doesn't care about the loss of frequent flyer miles, then the lack of the conversion fee is a benefit. But anyone considering this card should check www1.epinions.com. Three hundred people gave it 2 1/2 stars out of five. Recent posts there: &quot;Capital One, Can you Lend me a hachet and end my Misery?&quot; and &quot;The people at Capital One think you're stupid. How smart are you?&quot; and my fav - &quot;The Official Credit Card of Satan.&quot;

I have realized that regardless of whether you pay an overseas operator that has quoted prices in local currency by credit card or bank wire, count on a minimum of 4 to even 5% exchange rate plus fee cost.And for credit cards, the CC companies charge a minimum of 2% to the agent, which is typically passed on to you. This is in addition to the 3 to 4% loss.

I just wired a large sum in ZAR to our agent in South Africa for our upcoming trip this summer and the rate Citibank gave me was 6.73 when the official rate was around 7. They are making a minimum of 4%. I had mistakenly thought the bulk of the bank wire cost is fees, but learned the fees are relatively small- its the exchange rate where they get you. I have also noticed at least with bank wires, the bid/ask retail spread has been growing compared to previous years.

So, I guess the point is with the US$ sinking against most currencies, bank FX &quot;fees&quot; are adding to the cost of overseas travel for US based travelers. When comparing a US based operator that quotes in dollars to a overseas agent quoting in local currency, around 5% should be added to the overseas operators cost to make it an apples to apples comparison.

Clematis -- those customer service comments are too funny and yes, too true. Guess that makes me a bona fide masochist!

Patty - Your point is well taken. I believe a lot depends on the &quot;type&quot; of customer you are with any particular credit card/financial institution. And, as in your case there was no Foreign Currency Exchange fee with Amex on a foreign charge even if in USD.

My experience, which was a hoot, some years back before Europe went to the Euro, a friend and I, both with the same credit card, withdrew from the same ATM about 2/seconds apart, the same amount of French Francs. When our bills came in, she had a more favorable rate than moi. So we inquired, why? Well, knowing my friend, with lots and lots of $$$$ in her account, and poor me... very simple, she got the better rate. It didn't amount to a great difference, but gave pause to be on top of this.

Similarly, it can depend on the type of card you hold with a financial institution when it comes to fees (or not) - whether the basic, platinum, gold, black (oh, just pick a color :) ) card, there will be differences. It's just not the same for everyone.

We all have the responsibility to check for our specific needs, type of card and whatever criteria used when it comes to using credit cards.

As far as vendors/suppliers who accept credit cards (whether a shop, restaurant, tour operator, etc.), their fee for providing client the convenience, is included in their price to said client. That's just the way it is... no one gives anything away for free. But, we all know that!

Pula, you're a good sport with a sense of humor!

Akr, some great info there, thx.

Sandi, funny story about your different charges. Generally, in the US, I can use my AE card many places and there is no additional charge. But some small shops, (and this is rare), will say they will have to charge an additional 5% because that's what the card charges them.

In the case of my SA outfitter/TA, I have the choice of submitting the money via a bank transfer or the same amount via a charge card. She is distinctly waiving the usual 5% charge for us to use a credit card. So she is absorbing that cost. This is after the fact that she has given us discounts on camps and it's not like she can reconfigure our costs to reclaim it. Am I missing something here? I don't see where she is charging me for that 5%, as you suggest.

I double-checked and Patty is right, AE Plat will charge a 2% conversion fee when it's charged in rand. The exchange rate he said will be whatever the commercial banks are quoting at the time of processing. So knowing that a bank transfer is also costly, thanks to AKR, in my particular case I would rather use the cc and get my ff membership reward points for this purchase, as well as the airline insurance, and also not have to go to the bank.

Clem - As you indicated, you've used this agent previously, and referred others them, so it's most likely they have chosen to not charge the 5%. I've had that happen, when usin the same agent for a third or fourth trip; not a percentage, just given a lumpsum discount. Hey, go for it! The agent will make it up elsewhere.

Yup, that was oh so interesting with those French Francs ATM withdrawals. Though after-the-fact, told my friend that next time, we'd have her withdraw funds and then we'd split them. I'd pay her back in USD. Gotta find what works best.

What surprised me - your statement that a US shop that accepts Amex wanted to charge you 5% for use of your card to pay for your purchases. Believe it is illegal for a vendor/shop/restaurant, etc. doing business in the States... against the rules of their contract with Amex, Visa, MC. Naughty vendor!

Patty - The incident with Amex using a less favorable exchange over Visa, happened quite a number of years before those Foreign Currency Exchange fees and conversion fees were pretty much the same for Amex, Visa, MC... about 8/yrs ago. In that case, the Amex exchange was close to $200 more than the that of Visa. If it has been only $20 my friend would have ignorned it - in the scheme of the total trip this would be the price of a mid-day snake at a bistro (no big deal) - but $200 is a lot of money. You know Amex was read the riot act; the difference eing credited to his account.

Sandi,
I would've certainly contacted them too if the difference was that great. Sounds like an error may have been made since a few percent difference wouldn't have accounted for that much (unless your friend's half of the hotel bill was in the 5 figures ;) ).

Clem,
If you have to send the wire transfer in ZAR, your bank's markup may be even higher than Amex. I had to send a EUR transfer last year through Wamu and they're mark up was about 3%.

Thx, Patty. Sandi, maybe I'm hallucinating about it being an American vendor. It was a long time ago.
Since we are talking about Africa, I had to read this a couple times before I figured out it wasn't some expression! :D

&quot;in the scheme of the total trip this would be the price of a mid-day snake at a bistro (no big deal)&quot;

Patty, it occurred to me why my TA put the exchange rate. She has been quoting us in US dollars for each piece of our trip, so we can relate to it. So now we have a grand total in dollars. She then is using her 1:7 exchange rate to get an amount in rand. And that rand sum is what we will have credited to our credit card.