Credit card that doesn?t charge 3% fee for converting Euros
 

Seems both my credit card and bankcard charge a 3% fee to convert from Euros. Are there any credit cards that don't have a fee or have a lower fee? Also, how is it best to pay for things? Charging, paying w/cash, paying with travelers checks. And what about getting US$ traveler checks and converting in europe, vs. getting euro travlers checks in the US? Which has the best exchange rate?
Thanks

A while ago someone posted that an MBNA Mastercard charges perhaps 1% exchange rate. You could see if that is available.

I am in Canada and every card I have seems to charge in the range of 2.25-2.75%. However, my American Express gives cash back so I use that one anyway.

Check with each of your credit cards, but I think it is across the board now. You might want to see what your bank's ATM charges are- mine were prohibitive, so I have opened a different account for this purpose.

This 3% fee started about 2-3 years ago. I had called my credit cards to authorize the foreign use, and never knwe anything about this policy. I came home to a bit of a shock. Luckily I didn't spend much, just a few meals. Everything else was in cash.

Visa & MC charge 1%. Most banks add another 2% just for the heck of it. MBNA, USAA & Capital One don't (at least last time I checked). Amex has a total of 2%.

Don't bother with TC. Difficult to use and expensive. Just use your ATM card everywhere to get cash in the local currency. You'll get the best possible exchange rate. Just ask your bank how much they will charge for withdrawals from banks out of their network. European banks won't charge for using their ATMs, but your bank might.

Anne

Do check with your bank and see if they have reciprocal agreements with other banks in europe for ATM use. Bank of America does not charge if we use BNP Parabis in France or Barclays in the UK.

Just checked this a few weeks ago before an overseas trip. Three of mine charged a total of 3%...Only USAA (Mastercard) charged the lower rate of 1% !. The 1% is MC, and USAA charged 0%.
Most banks charge an additional 2% on top of the usual MC and Visa charge of 1%.

I did call and ask my bank about ATM withdrawels. I am charged 1.50 fee from them, plus whatever the fee is at that ATM machine, plus a 3% fee. So once again I get hit with the 3%. And that is with the banks that 'share' the same system as them.

We are going to Europe for a month, so we are going to have a lot of expenses. So I'm willing to open a new checking account for an ATM card, or open a new credit card if it will help save some money.

Is there any ATM cards that don't charge a fee plus 3%??

Maybe I'll call Bank of America to find out about their ATMS... any other ideas are appreciated!

I can confirm that MBNA and Capital One do not charge extra % for foreign purchases. They will charge their customary cash adv fee if you use them at an ATM.
My Wachovia check card allowed 3 free non-Wachovia withdrawals/month, then a $2 fee per withdrawal was assessed for ATMs in Europe. Purchases (ie. hotel room) are treated like credit-card purchases, no extra fees.
Once you go to Europe, and think you will return, get 100E or so before leaving to fund your first day the next trip. Much better than a)buying in the States before departing or b)finding ATM at airport - I like to hit the ground running.

My bank doesn't charge a 3 pct fee for my ATM card, I know because I just used it in Europe about a month ago. It's a local bank in Maryland, though, so I don't know that I would change banks just for that. They do seem to charge about a one pct rate over the interbank rate, though, from my calculations.

I have two credit cards and neither one charges more than the one percent MC/VISA fee -- I have a AAA VISA and a Capitol One Miles One Mastercard.

The AAA Visa card is issued by MBNA.
Last I asked, it charges 1% for non US dollar transactions. No add on.

I just checked with AAA Visa (MBNA),
and was told zero conversion fee.
My American Express wanted 3%.

MBNA doesn't charge you any "additional" fees, but the standard 1% is there in the conversion rate.

My Amex cards definitely have a 2% charge in the conversion, no more no less.

My bank, a local bank in Massachusetts, does not charge a fee for ATM withdrawals abroad, nor does it add 3% for conversion. It is definitely worth shopping around and opening an account to avoid these fees.

Although I knew different banks charged different rates on overseas credit card transactions, I never enquired which had lower rates, etc., so am very glad that I can benefit from the collective knowledge on this thread! Travelnut- I too, have a Wachovia ATM card, and was wondering what they would charge me, as I just returned from Asia, where I used my ATM card a number of times, so that info. was very useful to me, and the MBNA card info. as well. thanks!

They all charge 1% as MC/Visa when converting foreign charges to US currency add a 1% charge to the interbank rate. This is reasonable as it is MC/Visa who are assuming the risks of currency fluctuations.

Once the charge has been converted within the MC/Visa system, the charge reaches your bank, assuming you are in the US, as a USD amount. At that point it makes no difference if the charge was incurred in London, Paris, New York or Timbuctoo. It is here that banks have figured out a way to rip off their customers. Many of these near criminal banks now add a 2% fee. Try to get them to tell you what this fee is for; they have no currency fluctuations to worry about, they don't have to move different currencies from branch to branch which are things which they use to justify the high fees they add on when exchanging USD bank notes for Euro or Sterling or whatever.

Just once, I would love to know what people are being charged for when the banks add an additional 2% to their charge which is what it is, a surcharge for using your credit card. Something banks prohibit merchants from doing (ah the hypocracy).

Of the big credit card banks, only MBNA and Capital One do not add an additional 2%. Yet many people call them and are told there are no currency exchange fees; there sure as hell are i.e. the 1% Visa/MC asses.

OTOH there are the ingorant fools who brag that they use Citibank credit cards (or Chase or Bank America or Bank One) and don't pay an additional fee. They don't read bulletin boards, they don't read inserts, they don't read articles on the net.

The banks lost a multi million dollar law suit because of their failure to notify customers about these fees; and they fought it like the dickens. Imagine, they don't want people to know how they are being ripped off.

The other problem, of course, is that when the fees were first instituted, they might have been still born if people had all voted with their feet and told these banks to shove it and moved to the banks, at least for their foreign charges, that don't asses an additional 2%. But the banks' surveys showed people are idiots and don't mind being ripped off.

Incidentally, just for the record, Amex charges 2% above the interbank rate. But do remember, there are many merchants in Europe who take MC/Visa but won't touch Amex with a 10 meter pole.

Also be aware that many credit union banks do not charge the additional fee; but some, who depend on the near criminal banks to do their credit card processing, do.

Hi eb,

As noted:

VISA and MC charge 1% over the bank exchange rate.

MBNA does not add an additional fee.

AMEX charges 2% above the bank rate.

European ATMs do not charge a fee to give you Euros. Your bank will charge you a fee for "out of network" use of your card. This can be anywhere from 0 to $3.50 each time you use it.

Your bank may add 1 - 2% above the exchange rate for ATM withdrawls.

Traveler's Checks, denominated in dollars, are useful for emergencies, but not much else.

We charge as much as possible and use ATM's only when necessary.

MBNA Mastercard and State Farm Visa don't charge the extra amount. Chase Freedom charges the 1% but then they tack the 2% on top of the amount that already has the 1% added so it's really more than 2%. That doesn't sound like much, but if you have a large hotel bill it makes a big difference.

I have found USAA FSB to be unmatched in terms of customer service. They are not a local bank, so they are used to dealing with people around the world.

Their credit cards give the very best exchange rate.

Their ATM cards have no fee for ATM usage, and they actually rebate any ATM fees imposed by local ATMs, up to, I think $15 a month. Of course, there is no local ATM fee imposed by european ATMs, anyway.

You can access your accounts on-line, and even transfer funds on-line.

We have used their services in travels to Europe, Asia, and Kentucky, and have been very satisfied.

I second the comments about USAA FSB out of San Antonio, TX. We live in Washington, but still use them.

A bit over a year ago, because of a thread here on Fodors very much like this one, I obtained a Visa card from the Motley Fool, the financial radio program. The card is issued through MBNA, so there's no additional fee beyond the 1% Visa fee, and the card pays 1% cash back on all purchases. Unless there's some hidden charge somewhere that I'm unaware of, that nets out to zero surcharge on foreign purchases.