What *IS* the exchange rate at an ATM?
 

Does anyone know what kind of exchange rate Bank of America charges at the ATM? I know that if you use an ATM in their network, such as Barclay's that they waive the $5 fee. I'm going to the UK in two weeks, and I've talked to three customer service reps, and have emailed their online customer service twice and a third time today and I keep getting different answers. No one seems to know anything!

One rep pointed me to the exchange rate on their site that is for getting cash in advance and told me that was it, a whopping 5.5% above the inter-bank rate! Wow. If I wanted to get ripped off I'd exchange money at the airport on arrival.

Has anyone here used a BoA card in the UK at a Barclay's ATM and figured out whether or not they are ripping people off with the exchange rate?

Thanks!

hmm, I've been asking some questions on another thread trying to understand who really is making the markup.

However, in your case, the five percent for getting a "cash in advance" sounds like you are talking about a credit card, and that's just a fee for getting a cash advance, which is a loan on a credit card. It's not an exchange rate thing. If you just mean for the bank to buy euro for you at home and you go fetch it, that is actually a pretty good rate for that service. Five percent isn't really that high for your local bank getting foreign currency for you.

I don't think you'd call using an ATm as getting "cash in advance".

The ATM charge I've noticed is 0.33% above the day's rate using http://www.xe.com/ccc/ for my benchmark.

That's using my ATM card <b>not</b> asking for a cash advance on my credit card.

&quot;<i>What *IS* the exchange rate at an ATM?</i>&quot;

There is <u>no exchange rate</u> at an ATM. You ask for &pound; you get &pound;. No exchanging going on. The rate is set by your own bank/system once the withdrawal is presented to be taken out of your account.

I'm not talking about a cash advance, I'm talking about using my check card at the ATM. Sorry for the confusion, when I said &quot;cash in advance&quot; I meant getting Pounds before leaving.

And I know that I'm not really exchanging money at the ATM, that it's my bank doing it. I just want to know what that elusive exchange rate is. Why does no one know at BoA? They set the rate! Maybe someone here has traveled recently and paid attention to this?

And with the exchange rate the way it is, 5.5% *is* a lot of money. Over the course of the trip, if the ATM is 1% over the interbank rate as opposed to 5%, I would have an extra $200 to spend. Maybe some people can just throw $200 away and not care, but I'm on a budget. I'd rather buy souvenirs than feed my bank.

Thanks!
--tracker

The exchange rate is at or just slightly above the interbank wholesale rate at the time when the exchange is made, which no one knows until that very moment, plus whatever service fees they add, usually 1-3 percent.

You won't find a better rate. Someone may come on there and tell you about their credit union or bank that charges lower fees than BofA, but it won't be worth changing banks. Stop stressing over it.

hi tracker. As far as I understand it, the exchange rate you get for your withdrawal is ever changing. What I mean is- you would be subject to the applicable exchange rate on the particular day the transaction hits your BOA account. A better question for you to ask BOA is- what is today's dollar to pound exchange rate? That would give you a ballpark figure to work with.

You are correct about the Barclay's withdrawal fee waiver.

No matter what the &quot;rate&quot; is you would not end up w/ $200 more to spend.

An ATM is the cheapest way to get cash. Whether it costs $20 over the course of a trip, or $200 - any other method would cost you more.

But just how much cash are you talking about anyway?? Unless you plan on spending thousands in cash your ATM fees will not be large - EVEN at BofA.

Not worth fretting over IMHO . . . . .

EricH: <i>You won't find a better rate. Someone may come on there and tell you about their credit union or bank that charges lower fees than BofA, but it won't be worth changing banks. Stop stressing over it.</i>

Yeah, I'm one of those people recommending his credit union. I'm in Italy now and have made two ATM withdrawals. They've charge me a 1% conversion rate fee (a separate debit on my statement for each ATM withdrawal, so I can see the exact amount). I calculated the conversion rate on each day and it is 0.2% or less difference from what I found on x-rates.com for those days - assuming they are using a slightly different method of rate calculation (one of the days the difference was 0.03% so very close).

And no ATM fees from either the ATMS here or from my credit union - sweet!

We've had this thread before, but I really can't see a reason to stick with a conventional back if you have the choice to join a credit union (not everyone can, but most people can). All a regular bank does is charge higher fees while offering the same basic services. Banks are for-profit businesses who are not making a large percentage of their profits from these fees alone. If you like fattening their profits, be my guest.

I can't imagine doing it any more cheaply than going the ATM route.

I posted this on another thread:

We recently returned from London and was pleased with using the ATMs for cash.

My credit union told me before we left that they could not control any fees the ATM owners could levy, but we never encountered a machine that charged an extra fee, so that worked out ok.

Our own credit union charges a $1 fee when we use a non-credit union ATM, but they refunded this fee when I returned (as was promised by the credit union before I left).

The exchange rate the credit union used was $2.03 for each pound - I don't know whether that included an additional charge or adjustment to the official exchange rate because I don't know what the exchange rate for that particular day was anyway. But it seemed pretty fair, and I am satsified with going this route (ATM).

tracker,
See http://www.bankrate.com/brm/news/cc/20050624b1.asp

Henry

tracker, you are confusing the exchange rate with the conversion fees, I think. All ATM traffic is exchanged at an interbank rate, you can get very close by just using a currency calculator on Yahoo!Finance...
At that point, all users are getting the same 'deal'.

The extra charges come into play in three parts:

1. Visa or Mastercard network - they pass a 1% fee to your bank for converting from &euro; to $ (or whatever fits). Your bank can choose to pass this 1% on to you (or not).

2. Your bank chooses to add an extra 1,2% to that of #1 for &quot;foreign transaction fee&quot;

3. Your bank chooses to charge you $x for using an ATM outside your bank's network (European banks do not charge you for using their ATM). Bank of America has a partnership with ?? bank in Europe, so if you use that bank's ATM, then BOA will not charge you the fee. Otherwise, BOA will charge you $x.

So the best you can do is choose the bank (or credit union or brokerage firm...) that adds on the LEAST of the above charges.

I used my BofA card at Barclay's in the UK. When I got home I looked up the closing exchange rate for the dates I used it and I was charged a 1% markup.

Actually, over the course of two weeks I will be spending *thousands* I'm paying for our accomadations and everything in cash.

And BoA is telling me that to get cash out of an ATM that it's the rate on their site which is marked up 5% over the interbank rate and that there's a 3% charge tacked on to that. I don't know that they know what they're talking about, or who to believe. I've talked to a bunch of different people and no one gives me the same answer. Methinks I'm going to check out another bank.

tracker, that sounds more like the rate you will pay to order currency from BofA and get it here in the US, not what you will get from an ATM.

That is simply ridiculous.

But as has been mentioned many times on many thread - the next US-based bank customer service agent who know what s/he is talking about when it comes to foreign -- will be the <u>first</u> one.

8% - that is plain nutty. Now - for buying &pound; in the States 7%-8% is about right. Go w/ your Bof A ATM card and use Barclay's machines and you will be just fine.

was posting the same time a P_M - I didn't mean her post was &quot;ridiculous&quot; :) (meant the 3% plus 5% being ridiculous)

But we agree - they were not talking about ATM costs.

I knew what you meant, janis. ;-)

tracker, this article was posted on another thread but I think it will be of interest to you. If you scroll down a bit you'll find the part about BofA and how there are no fees for ATM w/d's from a partner bank.

http://seattletimes.nwsource.com/htm...3_pucci30.html

Very same question I asked on a call to Bof Am. yesteday. They said 3%. Me, myself, I just drew out the cash today from my bank account, &amp; I'm going to the bank, exchange the dollars for Euros &amp; hope for the best.For me, it's too confusing to do it any other way. Good luck to you.

There are two parts to the &quot;exchange rates&quot; The first is the rate which VISA (or Mastercard) sets which you can find at:
http://corporate.visa.com/pd/consume...r_ex_rates.jsp

Quoting from the site:

&quot;Exchange Rates

Currencies fluctuate every day. The rate shown is effective for
transactions submitted to Visa on October 14, 2007.

1 British Pound = 2.04 US Dollars&quot;

The second part of the rate is the ATM fee your bank charges for use of a foreign ATM plus a percentage of the transaction which may be 0% (getting rare) or 1 to 3% more often.

BTW, every credit and debit card comes with an explanation of the foreign exchange policy. Who ever reads those?

Are we being penny wise here with this exchange-transaction fee issue? For me, it's confusing. Like I just posted elsewhere, I went to the bank and took out enough money for the 21 days over the three countries, (* I have 2 back-up cr. cards in case). So I figure, get to Germany with my dollars, buy enough Euros for the bus to get me to the hotel, in Frankfurt, then go to the first German bank, lay down my dollars and get the Euros. To me that sounds like the best way to avoid the additional charges by using ATM's and cr. cards. Donno- confused. Oh Lord, this is the most of the decisions so far!!!!

virgi, by exchanging cash you probably paid 7-10% markup plus any flat fees. By using my BofA ATM card I paid a 1% markup and no fees if I use a partner bank. If I'm in a country with no partner banks I use my credit union ATM which charges 1% plus a $1 fee. Sorry, but you lost money and you didn't save time, as an ATM withdrawal takes appx 30 seconds.

I'm no financial genious, but paying 1% at the ATM beats the crap out of paying 7-10% at a bank or exchange facility.

Yeah p-m No I didn't lose it yet - I leave Tuesday. I'm going to re-deposit the cash, and just go with the ATM. Luckily I found out from 2 fodorites just a while ago. By the way, B of Am told me (I called) that the transaction fee is 3%. I spoke with them yesterday. Found out from ira and j6 something.However, this subject is mentioned many times, I should be able to absorb it by now!

Sorry virgi, I thought you were speaking in past tense. I know the transaction fee for using a debit card for purchases is 3%, but when I used my debit card in Feb 2007 it was 1% for the ATM w/d. Of course it's possible they have raised it since then, so I will call BofA and ask about that. If it has gone up to 3% I will use my credit union account from now on.

virgi, I think you are wrong as BofA still only charges 1% for ATM withdrawals in Europe -- and nothing in Germany if you use Deutschebank ATMs which are everywhere. Even if they did charge 3% why would you think it's easier to pay 7 to 10% to exchange your dollars at banks or exchange booths over there? Are you pulling our collective legs here or what?

I meant to say &quot;and nothing extra&quot; (like the usual $5 per transaction charge for ATM withdrawals) when using Deutschebank ATMs.

virgi: As I said earlier, US banks simply do not give out accurate information about foreign transactions. Or hardly ever anyway. I am almost positive the customer service agent was talking about purchases. 3% is about right for that w/ BofA. maybe because you mentioned there was a visa logo on the card or something.

Good thing you are re-depositing the money into your acct. Carrying all that cash around all over Europe is a recipe for disaster. You might be able to put it in a hotel safe (not all hotels offere that service BTW) but not when you are traveling between cities/hotels.

Obfuscation! Or do the money changers explain clearly what their price will be? The question posted needs re-wording. The Automatic Teller Machine (ATM) has nothing to do with the Exchange Rate or Currency Conversion Rate. That rate is determined by the customer's service level and the bank making the conversion. A secondary charge is assessed by the customer's bank. The conversion rate changes daily! The customer's bank fee is fixed (at least until notice of a change is posted). Europe has many ATM machines that have no connection with a bank. They tend to charge higher use fees than captive/house machines. Please note; you are not being 'ripped off' at an airport or hotel exchange desk, you are paying for convenience and service.

BTW, every credit and debit card comes with an explanation of the foreign exchange policy. Who ever reads those?

OK, I'll answer my own question.

Apparently, nobody here.

From the VISA site today, 10/15/07

Currencies fluctuate every day. The rate shown is effective for
transactions submitted to Visa on October 15, 2007.

1 US Dollar = 0.49 British Pounds

The 'currency calculator' below gives you an indication of the cost of purchases you make when travelling internationally.

Effective: Oct 15, 2007
1 USD = 0.49 GBP / 1 GBP = 2.04 USD

British Pounds to US Dollars

1 = 2.04 50 = 101.78
5 = 10.18 75 = 152.67
10 = 20.36 100 = 203.56
20 = 40.71 150 = 305.34
25 = 50.89 200 = 407.13
30 = 61.07 250 = 508.91
40 = 81.43 300 = 610.69

Tracker -- simple answer to your question. I used by BofA ATM/debit card at Barclay's in London about 4 times during our stay there in June/July. All the withdrawals were done at the XE.com rate for the date and a 1% &quot;charge&quot; was added to that. There were NO other charges. Period.

We arrived in Mallorca yetsreday from the U.K. Although I had enough euro in hand from previous trips, it still seemed a good idea to get more, so it was off to the bank in Palma.

I was unable to get money at the first five ATMs. The transaction was cancelled by the machine. It was not a problem with my card, since a local resident before me had the same problem. Fortunately, my sixth attempt was successful, and my daughter had no probelms with her card later that afternoon. I rely on getting money from ATMs on overseas trips, and was glad to have some euro already with me.

Incidentally, the ATM offered to debit my account either in pounds or in euro, and quoted the exchange rate it would use. I have had the previous offer when using a credit card in a French hypermarket, and was similarly given the full details. This completely throws me, since I cannot recall the current exchange rate and work out which is the best option while standing in the street waiting for my money.

When a store or ATM offers to accept payment in pounds in a euro-country, you are falling victim to dynamic currency conversion, a good deal for the credit-card company, which charges extra fees for the &quot;convenience&quot; but a bad deal for you. The precentages vary but are usually significant ... considerably more than the 1 or 2% conversion fee that most banks or credit-cards charge to take money out of a foreign ATM or buy something with a credit card in a foreign currency.

So the answer is NEVER allow a bank or credit card to charge you in your own currency back hom; it's ALWAYS a better deal to be charged in local currency.

And almost always to your benefit to use an ATM to withdraw money in a foreign country, especially if you use an ATM that has a deal with your bank so you don't have to pay a withdrawal fee. As long as you don't get a cash advance on your credit card, you'll always do better than if you exchange money. You will usually have to pay a small percentage (often 1 or 2%) above and beyond the 1% that the processing company charges (usually another 1%), and some banks like Capital One don't charge anything.

i agree with janisj, it really isn't that big of a deal. use a b of a debit card at a partner bank (Barclays or BNP) or Capital One card and you will get competitive rates.

Some have mentioned credit union debit cards and they seem like a good way to go also.

Another caution about DCC-- having a transaction converted to your home currency-- the on-the-spot conversion rate will include a tidy percentage for the merchant, but to your credit card company it is still a foreign transaction, subject to the &quot;foreign transaction fee&quot; just as if it had been rung up in pounds or euros. You'd most likely be paying 2 or 3% to the merchant and the same to the card-issuing bank, for a total of 5% or more.

I really think some folks are mixing up &quot;plain vanilla&quot; ATM cards with debit cards, credit cards, and cash cards branded with a Visa or Mastercard logo.

To get the best rate, make sure you get a plain ATM card from your home bank--not a debit card, not a credit card, not a &quot;check card.&quot;

With a generic ATM card you should only pay a per-transaction fee for each withdrawal. The fee (often $5) is set by and charged by your bank. Conversion rates on currency should be the commercial bank rate, or very close to it.

I can verify this works with M and T Bank regular ATM card.

If your card has a Visa or Mastercard logo on it, all bets are off (and fees may be ON).

Frommer's Editor makes a good point about dynamic currency conversion on credit cards. Yet another way the money lenders can steal from you!

KidstoLondon, I don't know exactly what you are talking about. BankofAmerica's ATM card IS CALLED a Debit Card (also on the card mine is called a &quot;Platinum check card&quot;. I used to have an &quot;ATM only&quot; card from them, which you can get as a special request. But regardless, withdrawing money from an ATM is absolutely NO DIFFERENT with any of those. I gave up the ATM only card as some banks in Europe will not work with an ATM only card -- more and more they need to have a Visa or Mastercard connection (AND NO I'M NOT TALKING ABOUT BEING A CREDIT CARD).

I have no idea what you mean by &quot;all bets are off&quot; if your ATM card has a Visa or MC logo. Are you aware that Cirrus and Plus are also Visa and Mastercard logos -- that's what those names are? Having one of those logos on an ATM or Debit card will in NO WAY affect the charges for ATM withdrawals using that card. It would make a difference if it is a credit card, however.

The real way to tell the difference between a credit card and any form of ATM card is that if it is linked to take money directly from your own bank account for each withdrawal or purchase, then it IS an ATM card. If instead you get a monthly bill that you need to pay, then it is a credit card. Most (possibly all?) banks will charge no difference whatsoever in fees for ATM withdrawals from either their ATM only, ATM/debit, or ATM/check card.

I agree w/ NeoPatrick re ATM-only vs check/debit cards. No difference what-so-ever as far as I can tell. I've and had both types of cards from several different banks/credit unions. 6 of one / Half dozen of the other in my experience.

In terms of fees there is no difference between an ATM card and a debit card. But as Patrick and I learned the hard way, there are a few countries (Belgium, for example) where the ATM card does not work in the machines but the debit card does. That's when I switched from the ATM card to the debit card and I've had no trouble since. And once again, the fees are the same.