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Holy Cow! Credit cards and foreign currency transaction fees

Holy Cow! Credit cards and foreign currency transaction fees

Jul 29th, 2005, 06:28 PM
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Holy Cow! Credit cards and foreign currency transaction fees

My VISA and American Express have started charging transaction fees (2%) of every foreign currency charge. Are there any cards that don't charge this fee? How do you avoid this fees otherwise? We use our card for 85% of trip expenses;these fees will really add up.thanks!
Tuni01 is offline  
Jul 29th, 2005, 06:59 PM
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here's just one of recent threads on this topic
If you do a search on <transaction fee>
you will find more threads

elaine is offline  
Jul 30th, 2005, 03:55 AM
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Hi tuni,

Amex has always charged a 2% transaction fee for foreign currency.

Visa and MC have always charged 1%.

If you are seeing a 2% fee on your Visa, it is because your bank is adding 1%.

>How do you avoid this fees ...?

It is not unreasonable to pay 2% above the daily bank rate for currency conversion.

If you brought cash to Europe and changed it into the local currency it would cost 6-10%.

ira is offline  
Jul 30th, 2005, 06:33 AM
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Yes - 2% is quite good. Some are now up to 3% or more.

There are costs whenever you move from 1 currency to another. Credit and ATM cards are still the cheapest way to go. 2% is definitely not excessive.
janis is offline  
Jul 30th, 2005, 06:41 AM
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I think, too, that it points to the value of a card that earns points of some type. We just got back from Paris, and had a card that limited to only 1% (due to a relationship with the bank) AND it gave us points toward future travel, while also getting us an excellent conversion rate. All in all, we weren't unhappy.
jo_ann is offline  
Jul 30th, 2005, 07:31 AM
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Jo ann has a good point. If you check on previous threads, there are some people who are willing to accept the higher (3%) add-on charges of their CC because they derive a lot of points benefits from them. Then there are those of us just want to pay the lowest add-on fees.

There is a Capital One points card that adds only a 1% foreign conversion fee. You can see if this is a good card for you. USAA has a MC that also adds 1% only. I don't believe they have any rewards card but not 100% sure.
nibblette is offline  
Jul 30th, 2005, 07:48 AM
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We always use Capital One card and they do not have any transaction fees for foreign countries. We just came back from Paris last week and everything went smoothly.

NMIRA is offline  
Jul 31st, 2005, 05:52 PM
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>USAA has a MC that also adds 1% only. I don't believe they have any rewards card but not 100% sure.

USAA offers cards with both cash rebaates and "mileage type" points. My plain vanilla USAA MC offers a 0.75% cash rebate that nearly offsets the 1% foreign transaction fee.
topcat is offline  
Jul 31st, 2005, 06:33 PM
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Salomon Smith Barney FMA Master Card charges zero, zip, nada for purchases.

Flat $1 transaction fee for ATM withdrawal, any amount.
Robespierre is offline  
Jul 31st, 2005, 07:19 PM
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Is that Saloman Smith Barney card a debit or credit card?
platzman is offline  
Aug 1st, 2005, 09:14 AM
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I was freaking out a little about all the fees and then came home and did the math. I had a Visa (BankOne) that charged me 2%. So at the beginning of July, everything was being charged about 1.24 dollars to the euro (it was about 1.21 wholesale). This was almost the same as what I was being charged to take cash out of ATMs with a withdrawal fee.

The cheapest thing was to use banks that had agreements with Bank of America (BNP Paribas, Deutschebank, Barclays). Then I was getting cash at very close to the wholesale rate.

In any case, 2% of, say, $3000 in expenses winds up being $60. Nothing to sneeze at, but nothing to get worked up over. I felt much more ripped off at some of the bad restaurants we stumbled on . . .
fakemark is offline  
Aug 8th, 2005, 02:57 PM
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VISA is lying about the fee being a currency conversion charge. I just got my statement with a charge from a trip to Panama where they use the U.S. dollar and the 3% fee was added. This fee is just another way for them to siphon money out of cardholders and apparently most people are happy to just go along. If you only travel a couple of times a year it probably isn't worth the effort to complain, but I live overseas and travel constantly so I am not happy about this surcharge for the convenience of using my credit card.

Unfortunately, I don't really know where to complain to.
liefsimon is offline  
Aug 8th, 2005, 03:07 PM
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Was that VISA or your bank that charged the 3%? There is a difference between the two.
Michael is online now  
Aug 8th, 2005, 03:15 PM
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I think you do have to be careful as some place use various terms which are not correct on this -- such as "overseas", when that has nothing to do with it, it is just an addon fee for charges made in another country whether over a sea or not.

Now that's an interesting point about it applying to countries where the USD is the local currency, they shouldn't be doing that. That is lying about calling it a conversion charge when it's just a foreign charge. Panama isn't a US territory, either. It isn't really Visa, though, it's your bank who is the sponsor of the Visa--Visa is responsible for one pct of that charge.

I would start by complaining to my bank about it, especially if they referred to it as a "foreign currency conversion charge" in their notification.
Christina is offline  
Aug 8th, 2005, 03:24 PM
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Unusual, no. Unreasonable, yes. It just doesn't cost the banks that much in labor or anything else to process these electronic communication of debts and payment. Outrageous IMO, and they're doing it a) because they can and b) because others are doing it.
Aug 8th, 2005, 04:37 PM
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My credit card Visa and Capital One Visa - no additional charges whatsoever!

Also, I find the XE.com Credit Card Charges Calculator to be quite handy. Check it out at:

DeeDee is offline  
Aug 8th, 2005, 05:18 PM
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As Ira said above, if you take a wallet-full of dollars to Europe, and then change them into euros, you'll say more than 'Holy Cow!'
adeben is offline  
Aug 8th, 2005, 06:05 PM
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USAA charges 0%..zippo!
There is always the 1 % charge from MC or Visa, but that is all.

Another card I have, CitiBank, charges2% , then the 1% ...so there is 3% conversion fee.....BUT we get airline points!

So, for overseas travel we use the USAA! They are very nice to deal with also.

AND, don't let a hotel overseas try to bill you in dollars! Always in Euros (or the local currency)/. They will tell you that you come out better, but you don't! (THEY do)
mari5 is offline  
Aug 8th, 2005, 06:15 PM
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I dislike the fees as much as anyone, but I can't get over the people who think it's some sort of ripoff. Do you really think that $2.00 cup of coffee at Starbucks costs them that much to make? Wouldn't it be wonderful if everything we bought was only marked up 3% over actual cost? Banking is a business just like other businesses. Do you also object because they don't provide you with a home mortgage for free? It surely doesn't "cost them" 4 or 5% for the time and paperwork to provide you with that money, does it? While some people are finding credit cards that still only charge the 1% imposed by Visa or Master Card, I strongly suspect those days are coming to an end soon. Many former "free" credit cards have now started adding the extra charges.

What I think is funny is that some people who complain about the 3% charge are the same ones who think nothing of paying their bank or some agency up to $15 to get them 100 euros of spending money before they go. They say it is for convenience. Well isn't 2% a fair fee to pay a business for handling our exchanges for us and lending us the money for up to five or six weeks before we have to pay it?
Patrick is offline  
Aug 8th, 2005, 06:19 PM
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Speaking about USAA, they will also give you up to a 1.25% rebate and/or mileage reward benefits on all your purchases.
Budman is offline  

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