Credit card and Debit/ATM usage in europe
 

Hello,

Last time i travelled, none of my banks hit me with the 3% fee that they all have now. It appears capital one doesn't charge this, but i don't know if i can get a capital one card in time for my march 8th departure.

i have a credit union, and i have citibank. i need cash for hotels since they give a cheaper rate with cash. i could pay debit the rest of the way.

what are people's experiences? i know it's been discussed on the board, but it doesn't seem to be a central topic anywhere. i don't like travellers checks and i'm not a fan of purchasing currency before i leave.

any thoughts?

There was a recent article in either CN Travler or T&L that discussed this very topic. Bottom line - you are going to pay service charges on both credit and debit card usage, it's a matter of how much. If I recall Capital One was among the lowest - you might try calling them to see about getting a card prior to departure.

I'd take enough cash out of ATMs every day to pay all my expenses in cash. Your hotel will probably accept payments on account each day so you don't have to carry a wad of bills around.

You may not pay anything at all. Look at the post by xyz123 towards the bottom of this thread:

http://www.fodors.com/forums/threads...p;tid=34744730

He paid 4&cent; on a $33.53 transaction. <b>One percent</b> of that amount would be 33.53&cent;.

CitiBank should not charge you any fee for using an ATM card, so removing money from ATMs and not using credit card should be the best bet.

You also get the best exchange rate when you use ATMs because they use the NYC rate and Italian ATMs don't change you if you aren't &quot;with&quot; their bank either. So you shouldn't get any fees if you have a Citibank card?

And obviously it converts it from USD to Euro, so just remember that the exchange rate isn't so hot, and keep receipts

There is a good chance the credit union DEBIT card will not pass on more than the Visa 1%, if you want to fund that account (make sure it is a checking acct, not savings).

If you shop around, you can find cards that don't even pass through the 1%. Capital One doesn't, among others.

How much cheaper are hotels with cash rather than credit cards?

Anyways, if you have to pay a couple percentage points for the convenience of a credit card, it might as be a card that earns you points or miles.

I have both a debit and a Visa credit card with my credit union, and I was charged 1% per transaction on my last trip to Europe to use them. I didn't realize I was being charged anything for the debit card (it does have a VISA logo); otherwise, I would have used that Visa credit card everywhere. Citibank said they would charge 3% for my Citibank credit card so I never used that; American express was 2%.

Andrew

I have a Capitol One card and called them last week. They charge 1-3%. If you find out something different, let me know. Direct Merchants will charge 2%. Bank of America for debit cards charges a flat 5.00 so does another small bank that I use. US Bank for their debit card charges 3%.

Don't ever use a credit card to get cash - this is a &quot;cash advance&quot; and all kinds of fees kick in with a cash advance. Use your Debit card. I have one from Morgan Stanley and also one from BofA. Visa &amp; MC charge a 1% conversion fee before your card issuer ever sees the transaction. My Morgan Stanley does not charge anything above the Visa/MC 1%. My BofA charges and additional 2%.

My Citi Bank credit card charges 3-4% (it's a little vague whether the 3% is the total, or added to the Visa/MC 1%).

If your Credit Union card is a Debit Card and does not charge anything above the Visa/MC 1%, use that for everything - cash and &quot;charges&quot;. If it charges 2-3% above the Visa/MC 1%, find a credit card that charges less, and use that for the &quot;charges&quot;, but still use the Credit Union Debit (or any other debit card you have ) for cash.

Stu Dudley

Cash advances may not necessarily be such a bad thing as everyone seems to mention on this forum. It all depends upon your individual credit card, its terms and fees, and its annual rate of interest.

For example, I have a USAA M/C with a cash advance interest rate of 9% per year. If I use it for a cash advance and pay off the cash advance within 30 days of returning to the States, I will end up paying the normal 1% conversion fee, and less than 1% in interest. That is far superior to the BofA or CitiBank examples stated above.

Again, it's all what individual banks will charge you and what you are willing to pay. My recommendation is to shop around. ((b))

<b>The Visa 1% is <u>not</u> mandatory!</b>

Read this: http://www.corporate.visa.com/pd/con...x_faq.jsp#faq6

My Schwab and Salomon cards give me bank rate with no fees except $1 for an ATM withdrawal of any amount.

&gt;&gt;The Visa 1% is not mandatory!&lt;&lt;

What's the difffference between a 1% International Service Assessment and a 1% currence conversion fee???? It's still 1% that will end up coming out of my pocket.

Visa has no possible way to charge a cardholder directly. They charge merchant banks, and issuing banks. The issuing bank is not going to &quot;eat&quot; the fee, so they pass it on to you.

If you read the Q/A directly above the one you provided the URL to, you will see &quot;why&quot; Visa is not calling it a currency conversion fee any more - in some cases they do not convert the currency, but they still want a piece of the &quot;international&quot; transaction.

Stu Dudley

Whether or not the ISA is passed through to the cardholder or &quot;eaten&quot; is at the discretion of the card-issuing institution.

Both of mine eat it.

If you will do the math as I did on this thread, you will find that Capital One also eats it:

http://www.fodors.com/forums/threads...p;tid=34744730

Robespierre

On the link you gave, I think you are referring to xyz123's example of purchasing something on 17/01/06. I think xyz123 is making a erroneous assumption that Visa is using the interbank rate, as displayed on the oanda.com web site. If you look at Visa's web site (http://www.corporate.visa.com/pd/consumer_ex_rates.jsp
where they display the actual conversion rate* that they will use on 2/20 (today) transactions, it is different from the interbank rate on 2/20 as presented by oanda.

Visa's rate - which INCLUDES their 1% &quot;fee&quot; is 1.1920333

The oanda rate is 1.1938 - which is HIGHER than Visa's rate

Let me know what you think - I may be making an incorrect assumption myself.

* to minimize rounding errors, use the euros for $300 to calculate the Euro exchange rate

Stu Dudley

Run the numbers through http://www.xe.com/ccc

&pound;19, January 17, 2006, $33.53

(Why is everyone making this so hard?)

from xe.com:
&gt;&gt;To see an estimate of the bank charges you paid for this transaction:&lt;&lt;

This site provides an estimate - like it says on the last line. I think you are assuming that this site knows what Visa actually used as the exchange rate in 1/17. I would not make that assumption. The site could be using the &quot;interbank rate&quot;, which apparently Visa does not use.

Try a transion with today's date comparing Visa's published exchange rate of 1.1920333 $/E (including the 1%) with the &quot;ex&quot; calculation. Use your card that &quot;eats&quot; the Visa 1% and has the zero issuer added-on percent.

Stu Dudley

I used 1000&euro; and $1192.03 and it told me the fee was -.21% (which is within the margin of fluctuation error - basically zero.

Well, there's a lot of background esoterica about &quot;mid-market rates&quot; and the time of day that the transaction took place that makes it impossible to nail down any rate to make an exact comparison with.

The xe.com/ccc calculator uses the day's mid-market rate to perform the conversion, then compares that result to what you actually got. The difference represents what you paid for the transaction over the bank rate.

If there isn't any difference, you didn't pay anything.

&gt;&gt;The xe.com/ccc calculator uses the day's mid-market rate to perform the conversion, then compares that result to what you actually got. The difference represents what you paid for the transaction over the bank rate.

If there isn't any difference, you didn't pay anything.&lt;&lt;

I got the same results you got. Remember, the 11920.03 INCLUDES Visa's 1% ISA charge.

I think this means that if you use the &quot;day's mid-market rate&quot; to calculate what your Bank &amp; Visa charged you, it will look like there are zero add-ons when it appears on your CC statement. However, Visa does not use the &quot;mid-market rate&quot;. They use something else to get the 1.119203 exchange rate - which is 1% LOWER than the &quot;Mid-Market Rate&quot;. So your issuer does pass on Visa's 1% to you, if you can believe the XE calculation.

The only way to really tell, however, is to do a transaction with our Visa card in Euros, and on the day it clears, record what Visa's exchange rate was - not the &quot;mid-market rate&quot; and see if it the same as Visa's rate (therefore it includes Visa's 1%), is lower than Visa's rate (your bank eats Visa's 1%), or higher than Visa's rate (your bank is lying to you if they claim they don't add any percents themselves)

End of today trivia quiz

Stu Dudley