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Credit Card currency exchange rate, hidden charges?

Credit Card currency exchange rate, hidden charges?

May 4th, 1999, 09:20 PM
  #1  
John
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Credit Card currency exchange rate, hidden charges?

I always heard that the best exchange rate was available on credit cards because no commision and favorable rates.
On a different forum someone is venting about Amex charging a hidden 2% charge on all foreign transactions i.e they are increasing the exchange rate by 2%. I use Amex a lot in Europe and have never checked to see if there rate is differnt or too high compared to MC or Visa.
Has anyone observed this? Have any experienceor research ???
 
May 5th, 1999, 05:49 AM
  #2  
John
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John, the charges are not really hidden. AMEX fully discloses what they will be charging in those notifications they mail to us and what, probably, many of us do is not always read them. I just received one such notification last week, but don't have it with me. I think it did say they would be increasing their fee to 2% starting July 1. I don't particularly like it any less than you, but I still think it is acceptable and there are other benefits.
 
May 5th, 1999, 07:30 AM
  #3  
hcw
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I got the same notice from AmEx, saying that they are increasing their fee from 1 to 2 percent -- but I didn't realize that they were already charging a fee anyway. What is interesting is that, having used both AmEx and VISA extensively during my trip to Paris in March, I still got great exchange rates (better than 6 francs/dollar)even with that fee built in. It's not actually an "additional" fee, it seems just to be built into the exchange rate. So I guess that, since you're gonna pay somebody anyway, I don't mind this too much. It's still a much better rate than my bank gave me for the francs I got from them before the trip, and about the same as the rate I got using my debit card.
 
May 5th, 1999, 07:41 AM
  #4  
wes fowler
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John,
There's an interesting aspect to Amex's increase to 2% on foreign transactions. Amex states that the 2% will be based on an interbank, tourist or (where required by law) official rate of exchange. I think many of us have assumed that all credit card transactions would be based on an interbank (most favorable) rate due to the volume of transactions involved. Looks like we could be penalized if the transaction is booked at the tourist (highest) rate.
 
May 6th, 1999, 08:26 AM
  #5  
John
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Thanks for the info, I just returned from the Netherlands and used my amex and MC on the trip, I am going too compare rates and see what if anuy the difference is.
 
May 6th, 1999, 11:38 AM
  #6  
hcw
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So Wes,
Does that change your sentiment about the best way to pay? I gather that we have no way of knowing in advance how much "extra" we'll be charged? When I called AmEx for clarification, the person I spoke with reiterated what the notice said - that it could be "as much as" two percent. Does the same thing apply to debit cards? And are we likely to generate another hundred posts on this issue?

Thanks for your insight!
 
May 6th, 1999, 11:51 AM
  #7  
cheryl
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I'm beginning to think that we will just have to assume at least 3% on all credit card purchases. My one remaining card that didn't charge the fee just started 5/1/99. I believe if you use your debit card at an ATM, there is no percentage beyond the ATM fee. I don't know whether there is a fee for a debit card used elsewhere. However, a word of warning that I have never seen posted here, surprisingly, if you have a debit card that does not need to be used with a PIN#, I would not take it with me. In fact, I got rid of mine altogether. If these type of cards are stolen, they can be used by anyone, and that money comes directly out of your checking account and is gone for good. As I understand it, if I'm wrong, I'm sure Brian will let me know, there is no federal legislation regarding stolen debit cards, as there is with credit cards. If your credit card is stolen and used, you are only responsible for (I believe) $50 once you report it as stolen. This is not true of debit cards. Just a word of advice, for what it's worth.
 

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