Extremely high ATM fees in Portugal w/ Schwab debit card
 

Hi there, I have the Schwab high yield checking account and debit card that everyone recommends for international travel (no minimum balance & reimburses ATM fees worldwide.) I'm currently in Portugal and the ATMs are charging WAY higher fees than I've ever seen in Italy or Greece (12% to 14% of the transaction.)

I'm pretty concerned that these fees are different than what I've encountered in other countries (Italy and Greece,) and I'm wondering if I'm doing something incorrectly. Does anyone know how to just get charged a fixed ATM withdrawal fee like in the United States, and then just get the very low Visa conversion fee or whatever it normal is?

https://wise.com/us/blog/atms-in-portugal
Hope this helps. Lots of detailed info.

Perhaps you are asking for an amount in dollars, then it is being converted to euro. If so, you are being charged a conversion fee. Ask for money only in euro.

The question is, are you letting the ATM convert the money for you? As Sassafras says, this incurs a fee (but not as high as 12 - 14%.)

Always decline the "favor" of converting into dollars and choose the Euro option.

Usually there is a fee that is added by the issuing bank which you will agree to (like three or four euros) but Schwab refunds those fees at the end of the month. At least they do it on my account.

Sounds like you are a victim of DCC. If an ATM asks if you want the amount settled in $ or the local currency, always select the local currency. If you choose $ you will get a fixed rate, but it will be much higher than the rate that your own bank charges. Do a Google for “Dynamic Currency Conversion (DCC)” to get an explanation of how it works.

Also avoid drawing money from blue & yellow Euronet ATMs, which are privately operated and charge a higher withdrawal fee.

if you have a Visa debit card you can look up the conversion rate each day on:
https://usa.visa.com/support/consume...alculator.html

MasterCard has a similar website.

Thanks Sassafras, that is a good article, and it sounds like I should've attempted to find large banks like Deutsch if possible.

For anyone else finding this thread, the comments attached to this article (https :// www .portugalist. com /portugal-atms-guide /) seem like they may have the answer for those who cannot find the larger banks. I'll try to summarize my understanding in hopes of helping others avoid the ridiculous ATM fees I've been encountering. Still, I would recommend reading the comments on that article to gain a more thorough understanding.

If you go up to a Portuguese ATM and put in your card, you're going to be offered an absolutely horrendous rate (13.00% or so.) It will ask if you want to accept this rate. YOU MUST SAY 'NO' or select the option to REJECT the rate. It will likely show you a second screen that has some confusing information saying you've declined the rate and threatening you with an "unknown" rate or something like that. It again will be offering you the absurdly terrible rate that you saw originally. You need to say NO again (or reject their rate) -- read carefully because they're trying to trick you into clicking the button that will approve them to charge you your rate.

On one of these screens you should see the option to REJECT their scam rate and instead be charged the "unknown" rate. That unknown rate should be the market rate for exchanges, and will be MUCH more favorable.

To be clear, you'll still be charged the ATM charge (probably something like 4€ to 8€ if I had to guess) which is why you should use a card that refunds those fees worldwide, but the exchange rate will be much, much better.

Frankly I'm pretty appalled that the banking laws in Portugal allow for this dubious behavior. I've taken money out of sketchy looking ATMs in about 5 different countries, and at larger ATMs directly across from some of the largest tourist traps in Europe. Never before have I experienced such an abusive, and misleading process as I've encountered at every single ATM I've visited in Portugal. I hope that this type of abuse comes under legislative review at some point.

For the record, I've tried ATMs in multiple cities here, and and most recently sought out Multibanco ones located inside the doors of a bank. The result has been the same everywhere.

No it isn't the DCC from what I can tell. I'm well aware of that one and have been able to navigate it easily in other countries. This appears to be something different. Either that or it is the DCC fee and they've used MUCH more deceptive language and screens than what I've encountered before.

Something is going on, because Visa or MasterCard will charge what they show on the website when you add the bank fee %. Some ATMs use deceptive language, so you need to read carefully what appears on the screen. Some privately operated ATMs where I live try to sting you for charges, but thankfully British banks don’t have ATM withdrawal fees.

I have cards from both the US and UK, but hardly ever withdraw cash in the UK these days. I pay nearly everything by credit card, and my US bank has no foreign transaction fees, plus a 1.5% cash back on credit card charges. Since I always pay the balance each month, there are no interest charges either, so for me using a credit card is a no-brainer. Most merchants in the UK are happy to take cards for even small transactions, but that may not be true of Portugal.

Also avoid drawing money from blue & yellow Euronet ATMs, which are privately operated and charge a higher withdrawal fee.

I mistakenly took the bait and used one of these in Portugal in April. Fortunately, I used my Schwab card and was refunded the fee.

I use these all the time and the withdrawal rate is not that much worse than bank ATMs.

Banks are robbers. Unfortunately it is not just Portugal where these DCC rip-offs are going on.

In the past year, I'm beginning to be offered the DCC rate at ATMs in Italy, which I always decline. But when I've checked, it's not much different from the bank rate.

I encountered similar high fees, depending on the bank, not in Portugal but in France CDG and in Prague. From my trip reports:

The first thing we did after passport control and baggage retrieval was to get cash. Some service providers still appreciate cash over credit cards, in some instances credit cards are not accepted. Where you take out euros makes a difference, at times a big difference. The Euronet ATM machines charged me 13% to give me a receipt in dollars; I still get charged a 1% transaction fee by VISA. So we paid $364 instead of $321 (that day’s averaged rate). The statement printed on the receipt says that I chose that option as if another option were available; but my impression is that the only other option was to cancel the transaction.

I refuse to use free standing ATMs in the belief that they charge high fees for the withdrawal of cash even when asking for a receipt in the local currency. Our first withdrawal was with a Unicredit Bank which, they told us after we used their ATM, is not a bank but an investment firm and their ATM charged us 5% for the transaction. The Komercni Banka gives cash withdrawals with no fee, at least when the ATM attached to the bank building. When we left Prague we had requested at the hotel a cab that accepts credit cards. It was 7 a.m. when we left, and the cab did not accept credit cards. He stopped at a bank on the way out, a distance from the center of town, at an ATM , and this one charged us a whopping 18% fee on the withdrawal; the bank’s name is Česká spořitelna.

In case someone is wondering, I always refuse the DCC rate. I wonder if this wild variation in fees has developed recently. I recall variations in fees in Spain depending on the bank pre-pandemic, but usually between 3% and 5%.

Perhaps things have changed significantly during the pandemic, but I never recall these scams being so problematic. It used to be that if you had the Schwab card you'd just choose the amount you wanted, be charged a pretty small exchange rate, and Schwab would pickup the 5€ or so ATM fee. Seems like maybe it's back to having to really hunt for ways to avoid fees? Seems like a lot of steps backwards from where we were was travelers.... Pretty disheartening.

Has anyone tried using a euro based card in one of these machines? Do they get charged the same?
It could just be that Portuguese banks charge for ATM withdrawals no matter what.

Banks are businesses, like any other, they are no better and no worse than any other. Their aim is to make money, and I sometimes wonder how US banks do that with no fees, refunding fees, cashbacks, airline points etc etc. I guess we idiots in Europe are supporting a lot of that with our credit cards which don't offer such things and do charge an annual fee. Our banks also charge us for our accounts, pay miserable or negative interest rates, and often charge for ATM withdrawals.

I have always used the same Credit Union debit card and was always given the average daily exchange rate and charged 1% by Visa for the conversion. Depending on the bank and the country, that should still be possible. But I am excluding the possibility that the card holder's bank adds its own fee similar to the fee charged if one does not use the bank's ATM in the U.S.

That's a very gracious view of banks! One which I'm not sure a lot of people share....

Regardless, if Portugal treated their own citizens with these sorts of fees, you'd almost certainly had a disruptor enter and take over the market by now, forcing out these duplicitous business practices. Since that clearly hasn't occurred, I'd tend to assume that this is a targeting of foreign visitors; something I tend to believe should be spotlighted.

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I believe that European banks may charge a fee for an ATM withdrawal as long as that fee is also charged to its own customers.

I just got back from Italy and was offered DCC at an ATM--somewhere--can't remember where. The wording was different than whenever I've seen it before, so much so that I almost clicked "Yes." I may have encountered it one other time on this trip, can't remember which bank. I generally use credit cards, but like to have cash for taxis and other random purchases.

We ran into a few issues with ATMS in Switzerland last fall - we've been visiting for years, but this was new.

From my trip report:

The day we arrived, Bill encountered an ATM in the airport with a 4% surcharge. Say what? So he tried again at a different ATM in the Zurich train station, same thing. Then he tried again when we arrived in Grenchen, same thing. What the heck was going on? When it happened again at a fourth ATM (all different ‘brands’ mind you, bank, Post Finance, SBB, Credit Suisse), he went ahead with the withdrawal, still baffled, but thinking that Schwab might reimburse the charge, as they do with other ATM surcharges. But then we noticed the 4% did not show up as a separate charge, so Schwab couldn’t even see it; it was bundled in with the cash withdrawal.

This had never happened to us on our many visits to Switzerland; ATMs and credit cards have always had very similar exchange rates. But this time, at least on that first withdrawal, that upcharge led to a crap exchange rate, $1.08 for the credit card vs $1.14 for cash.

I posted this on TA and it was suggested we’d been the victims of DCC. I resisted, as we consider ourselves well versed in the DCC scam. This felt different.

Until…we both scoured the screen during an ATM transaction later in the trip, and there it was, a tiny box tucked away at the very bottom of the screen giving the option in CHF, the default option was USD. Sneaky. Sure enough, we had been DCC’d.

Note that this was not the case with every ATM. Some used CHF as the default option, which is what we'd come to expect in Switzerland. DCC is not new of course, but this appears to be a new technique in Switzerland to upcharge those using foreign debit cards.

This is a really informative thread, seemingly applicable to many places in Europe. Probably good to point out to new travelers and people who have not traveled in awhile. I don’t usually worry about a few dollars her and there, but this can be quite a lot if you need to pay for something big in cash.

During the pandemic I became accustomed to paying by card, and rarely draw cash from ATMs these days. Currency exchange bureaux in the UK are alive and well these days, and there are cash cards that can be preloaded with foreign currency. You may still need cash for a taxi or for small transactions, but I will use cards whenever possible. Reading the above replies, it seems ATMs are not the best way to go anymore.

Greece, where I have travelled for many years, recently began charging €2 -3 for ATM withdrawals. Merchants in Greece are now required by law to accept cards, in an effort to reduce tax evasion with cash sales. In South Africa, where I also travel, nearly everywhere cards are accepted. When I need a taxi I use Uber, and pay for the ride through the app. I still have a stash of leftover € and ZAR at home that I never got a chance to use.

Of course they are targeting foreign visitors, if people take out euros from a euro based account they would be be charged any conversion fee. But they would pay the use fee of 4 euros or whatever.

I was in Portugal in June and used the euronet machines. One withdrawal was 800 euros and I was charged $866 so the machine charged me $8 which is a bit higher than another ATM would be, but usually bank ATMs don't allow that much to be withdrawn at one time so for me it was more cost effective. I was not using my Schwab account though - I was using a different bank that gets me for another $5 every time.

I've read here that ATMs in Heathrow and other airports rip people off, but I got money out of one last week and there was hardly any fee at all.. I was a bit surprised by that.

People just need to be really careful - the euronet machine I know makes it very confusing and one wrong click and you have got a bad rate.

I think the key is that any time you are asked about exchange rate, it is DCC because no ATM is supposed to be converting your withdrawal itself, period. Your bank network does that later on. No ATM is supposed to be exchanging anything if you withdraw local currency. It doesn't matter if you have a US acct or not, if you withdraw euro, the ATM is not the one converting to USD. So if you are asked if you want the withdrawal charged in USD (assuming you have a US card) or asked about accepting exchange rates, it is DCC.

We were last in the U.S. in December 2018. I was charged $5 at a bank in Los Angeles when I drew csh using my U.K. devbit card. I was also offered DCC at a large store in Union Square, San Francisco. These financial charges are made in many countries. Go easy on the indignation.

I believe this DCC practice is a fairly new development for banks for the unsuspecting client making a cash withdrawal. My last visit to Europe was in 2019. I recall the warnings about DCC when making credit card purchases but not for banks. We should all de indignant.

Charging for a withdrawal is common in the U.S. Just as common is the client's bank to refund the charges depending on the circumstances. Depending on how much I keep in my account, my credit union will refund 5 to unlimited withdrawals done at a non-credit union ATM. My objections to DCC is that when I withdrew cash in CDG I was not given a clear choice between DCC or a statement in Euros, but rather a choice of getting the money or ending the transaction. Similarly, my 18% charge in Prague had nothing to do with DCC. I fully expect charges in Spain, and would recommend users of cash machines to avoid Santander Bank that had the highest charges.

All these charges, whatever the claim, have nothing to do with conversion since Visa still charges 1% conversion fee (listed separately in my monthly credit card statement) whether DCC was accepted or not.

It absolutely is not a recent development. Many Fodorites, people in travel journalism, blogs, websites, guidebooks etc have been warning about DCC for years -- decades actually. I first ran into it in Europe in 1999 or 2000. Nothing to be indignant about -- just be vigilant when looking at the cash machine screens and don't go into auto-pilot when withdrawing ££/€€.

janisj, you saw DCC on cash withdrawals more then twenty years ago?

DCC is not new....but the techniques have definitely changed in the past few years.

DCC is certainly not new. The first time I was caught by it myself was a meal at a Marriott in Tbilisi in 2009. I was met by an absolute refusal to redo the charge in the local currency (happily I wasn't actually sleeping there). It gradually became more common, until I encountered it everywhere I used a credit or ATM card in Switzerland in 2015. It sounds like the banks have simply gotten craftier with the wording.

I don't remember the exact year and it could have been in the early 2000's, but do remember it was the first trip I ever took where I used a debit card exclusively and didn't take any Travelers Cheques. It was a trip with two friends to London, the Cotswolds and Paris.

Curious I just did a quick google search and according to wiki (I know, I know - not necessarily the most reliable source ;) ) says it first appeared in 1996 and has been regulated in one way or another since 2007.

i believe it is the bank or entity that operates the ATM that benefits from the conversion. Declining the conversion allows your bank to be in charge of that.

“Dynamic Currency Conversion (DCC)”

This is not some "scam" by Portugese banks -lol! For sure it's something I've come across in Mexico.

Correct has nothing to do with the small fee most ATMs will charge (or if your home bank has a charge for out of next work). But none of these will clobber you like DCC can.

What happened to the OP happened to me in Greece about 10 years ago, twice. The first time, the ATM charged us $15 on top of the atm charges. The second time, I was ready, and kept hitting REJECT a bunch of times until it finally gave up and allowed the transaction to go through without the egregious charge. And, yes, it was DCC, which I knew about then so fought it like crazy!

I made sure before I signed ANYTHING charged with a credit card to review what I was signing. Because even though the vendors were supposed to ask you if you wanted to convert, as we all know, that did not happen all of the time.

When in Greece I’ve always used a bank affiliated ATM (Piraeus Bank, National Bank of Greece etc), and never was charged for the transaction. Visa and MasterCard add a 1% foreign transaction charge, but some US banks don’t pass on that charge. About four years ago Greek bank ATMs began charging €2-3 for foreign based debit cards. Withdrawals of larger sums less frequently helps to spread out the charge.

For those who travel internationally it is wise to check what your bank or credit union charges for foreign transactions. I currently use US cards that have no foreign transaction charges. My debit card passes on the 1% foreign transaction charge, but the credit card does not. My credit card gives me 1.5% back on every transaction, and both cards exchange currency at the market rate. If you have the discipline to pay off your credit card balance in full every month credit cards have several advantages over debit cards, but it’s best to use the debit card in ATMs and use the credit card in hotels, shops and restaurants.