Anonyimouse

Opinions please. If I make a purchase with my credit card in Europe, I end up paying a 1% currency conversion fee. That's not a big deal. When I use my debit card in Europe at an ATM, I pay a $3 surcharge because I'm not using my bank's ATM, but not a currency conversion fee. But if I use the debit card to make a point of sale purchase there is no fee at all.<BR><BR>So, here's the question. When I use either my debit or credit card online from the US to make a purchase in Europe for tickets for a show, to pay for a tour, etc., I also don't incur the conversion fee; can anyone tell me why? I'm not complaining, but the currency still has to be converted from a foreign currency to US dollars.<BR><BR>Thanks for your input.

curious

How do you know that when you use debit card in Europe you pay $3 surcharge but not currency conversion fee? <BR><BR>So how do you know when you purchase online from US, you aren't incurring the conversion fee?<BR><BR>Are you saying this because you do not see a line item your statement about the conversion fee? I have always found that they play game with the conversion rate and always bury the conversion fee into the rate.

Anonyimouse

Curious, to answer your questions, I have my credit card statements, and when I made purchases in Europe, at each transactional line item, appeared the conversion rate calculation for that day, plus the 1% surcharge. I had checked with Customer Service in advance of going to Europe to determine the fees, as I didn't want to be surprised when I received the statement.<BR><BR>Regarding online purchases from the US to buy a ticket to a concert in Europe, when the statement arrived, there was no conversion calculation for the purchase. I was able to determine this as the purchase was made during the same billing cycle as when I happened to be in Europe, however, I made the purchase before I departed from the US.<BR><BR>My bank recently was bought out by another bank, and when that happened the new bank sent me a booklet with all of the new rules and fees. In that description, it said that withdrawals from ATMs outside of the US would incur a $3 service fee, however, the conversion rate would be at the daily commercial rate posted by Visa, which is the emblem on the front of my debit card.<BR><BR>Anyway, I became curious as to why there wasn't the 1% surcharge for the online transaction from the US, which is why I posted the question here. I still think that the $3 ATM surcharge is steep, but I've seen posts where others have paid $5, so I withdraw the maximum allowable on my debit card, which is $400 US per day, and attempt to make a minimal amount of withdrawals to reduce the number of service charges. Actually, before my bank changed hands, I didn't have a service charge for any withdrawals using my debit card because of the account that I had and the balances that I kept in the account, but things change when small banks are bought out by larger banks.

Christina

I can't explain it, but I also haven't ever heard of any card that does that and also wonder if that's really the case. The one pct fee is charged by VISA or MC and I've never heard of a card that doesn't charge that for a foreign currency transaction. However, my two CCs don't itemize that fee separately, most people who don't keep up on that wouldn't even know about it. <BR><BR>I read a good article on this recently in either NYT or Wash Post and it said that it is up to the card issuer to decide whether to pass that fee on to the cardholder, but I don't think they cited any card that did NOT pass it on (which would amaze me). <BR><BR>I guess I'm wondering if you really were buying something from a US agent or broker who simply posted the charge in US dollars -- there are plenty of places that do that, even if you are buying tickets to foreign events (I think Globaltickets is one example). Otherwise, it baffles me as I would think your credit card company just sees the charge coming through in a foreign currency from the foreign entity, I don't think they would even know where you were physically when you made it.<BR><BR>I have made foreign purchases from the US on my credit card but there isn't any way I could compare because my cards don't itemize that one pct separately anyway, so I couldn't know for sure the rate at a particular point in time within a 1 pct margin of error. <BR><BR>

Duke

Just carry all cash and you will have no fees.<BR><BR>Don't want to do this? Then you have to pay a fee to some company that is in the business to make it easy for you to travel in Europe. This is called capitalism. Get over it. The fees ain't that much and they will not kill your budget. Just price out what one ATM machine costs to install and maintain.

Bob Brown

I cannot fully answer the question because I don't know the exact circumstances surrounding the use of your cards. I can, however, offer some of my experiences.<BR>Recently I obtained cash from an ATM in Canada. I did not have access to Internet at the time, so I did not know the exact rate of exchange at the precise time of the transaction; the best I could do was find out the closing rate for that date.<BR>Using that information I decided that I paid a 1% fee or charge to obtain the currency from the bank ATM. At the time there was no indication on my receipt of the rate, nor is there an indication of the rate on my bank statement. I would have no idea of the fee I paid UNLESS I knew the exchange rate in effect at the time of the transaction. <BR>Unless you know the rate you were paying at the time, I don't see how you can establish the amount of the fee.<BR>I measure the fee by comparing what I actually paid with the wholesale bank exchange rate. <BR>Most credit cards do not post a line item fee; they simply adjust the exchange rate in their favor and pass the difference on to you. It is very subtle. Again, unless you know the bank wholesale exchange rate for the time of the transaction, you cannot deduce the exact fee. At best, you can normally only approximate it.

Anonyimouse

I'm not complaining or concerned about the fees, I was just wondering why when I made a purchase online from the US on my credit card to a business located in Europe, that I did not incur the 1% surcharge. By doing this, it works to my benefit, because if I did make the purchase directly at the tour booth I would have incurred the 1% charge. Might this have something to with the information on the barcode when the card is scanned at point of purchase?<BR><BR>By the way, I have a Providian Visa, and each European transaction had very detailed information regarding what the daily conversion rate was, and then there was an additional information adding the 1% surcharge. The conversion rate was very close to the commercial sell rate that I checked each day on Oanda.

Bob Brown

I wish I knew the answer. Moreover, I wish I knew how to do it!!<BR>If you know the exchange rate at the bank wholesale level, and know exactly what you paid, then you have the facts!!<BR>So yes! Incredibly good point you raise there. <BR>I hope someone who knows the full answer contributes. <BR><BR>I hope my MBNA card does the same as the Providian card because both Wachovia and Bank of America levy the extra 2%.<BR>OK, so it is only about $60 for my trip, but I get nothing for it!! And the banks also charge the merchant a fee. It is also sort of a game with me! I'll be darned if I am going to pay something for nothing!! The 1% is unavoidable as far as I know, and I admit that even that much is a little much for essentially a nano second, or less, of time on the computer while it multiplies the coversion figures. <BR>

Leslie

Bob, the merchant makes less money when it accepts credit cards, because it has to pay anywhere between 3-5% (negotiated on sales dollars) just for the luxury of taking credit cards. The credit card companies have become greedy. I think the % figure is even higher with businesses that accept AMEX.<BR><BR>Bob, are you getting frequent flyer miles or a cash back incentive with the credit cards you have? I also have a Providian credit card, and although I don't get any miles, I don't pay any annual fees, and that 1% surcharge is why I have the card, as it is the one with the lowest rate for me to use in Europe.