Which Credit Cards have Conversion Fees?
May 8th, 2000, 06:08 AM
#3
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Visa charges a 1% conversion fee on all purchases; the issuer may charge an additional fee on top of that. Trying to put together a comprehensive list is futile, because the rules change all the time. Call and ask before you leave. <BR>I don't know about AMEX or MasterCard.
May 8th, 2000, 06:14 AM
#4
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going anon here in case of ridicule (feeling fragile this a.m.) <BR>before going to Europe last summer, Ed, I read an article stating that while most/all cards had been at about 1% conversion, several of the real biggies (I seem to recall chase & citi) were going to about 3%. That did seem too high to me, so I called the one card that I use, they said they were sticking at 1%. <BR>Okay, so I would lose 1%: BUT one of my business class tickets had come from points on that particular card (about a $7,000 value) just by using it over time, plus my money stays in a money market fund until it sweeps the money to pay this card on the 28th of each month (so I make interest on this money before the credit card company gets theirs) -- frankly I am not concerned! <BR>Plus, by using the card for every charge I could while over there, I got a substantially more attractive conversion rate for myself versus bringing cash (as some people still do) in the form of travelers checks -- which of course, one has to pay for ahead of time, versus using the credit car company's money for a month or so. <BR>Anyway, my feeling is that I'm getting a pretty good ride with a quality card that I pay off every month -- can't sweat the small stuff. Can't agree with you that "as travelers we should stay awar from cards that charge these extra fees" But do recommend that you check around so you minimize the fee.
May 8th, 2000, 08:53 AM
#5
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Best bet is to call the providers of your cards and ask. When I called two of mine some months ago, each had a flat 1% fee plus an additional 2% foreign conversation charge. However, when I phoned them again last week, each advised only a 1% flat charge was being assessed to foreign transactions. In between, I had written each stating that I planned to use travelers checks (which we obtain in the foreign denomination from AAA at about 99% of the published rate) instead, because I was not willing to permit them to charge me 2% for virtually nothing - it's all electonic. I, personally, object to new fees and charges dreamed up by financial institutions once you've become accustomed to the services, but for which they have incurred no additional investment or operating expenses - just more profit. I have no problem with the 1% (which has been around for many years), but the 2% currency conversion fees were just ridiculous in my opinion.
Jun 7th, 2000, 06:19 AM
#6
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Update: Calls to Citibank and 1st USA and American Express revealed the following: <BR> <BR>Amex: 2% flat, unavoidable. Pfooey. <BR> <BR>Citibank (AAdvantage -- American Airlines freq. flyer card): Their own 1% plus another 2% that they claim "MasterCard" and "Visa" charge, over which they have "no control." Pfooey. <BR> <BR>First American United Mileage Plus: 1% plus nothing else for Mileage Plus cardholders (another 2% for "regular" cards). <BR> <BR>On the one hand, that's good news for travellers. On the other, what premium are they (the banks) getting in the mileage-rewards scheme that makes it okay to forego that added 2% (and excessive to charge it on top of the 1%)? <BR> <BR>In any case, I know which card I'll be taking to Italy next month.
Jan 6th, 2003, 02:53 AM
#9
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Basically the large credit card issuing banks, whether it be a mastercard or a visa card, add an additional 2% to the 1% conversion fee charged by MasterCard and Visa. Incidentally this 1% is on the interbank rate which is the best rate possible on foreign exchange conversions not on the cash rate you get from a bank which has a built in 8 - 12% mark up.<BR><BR>Of the big banks, only MBNA and Capital One are not charging the additional 2%.
Jan 6th, 2003, 04:42 AM
#10
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I have heard that Chase and First Card charge an additional 2%. (actually I hear that there are no conversion fees for Chase Visa but 2% for Chase Mastercard). US Bank (Northwest Airlines card) charged a whopping 3%. I know that MBNA does not charge the extra fees.
Jan 6th, 2003, 04:55 AM
#12
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It is my understanding that all cards charge the 1% and many charge the additional 2%, but there is a bigger picture. Traveling with a friend I learned later when we compared our cards that although my card supposedly charged the extra 2% and hers didn't, in many cases on the exact same date in the exact same hotel, I got a better rate than she did. Nothing is confirming what base rate these banks start with. It is clearly my belief that some of those banks that don't charge those fees do not start with the same "discounted" conversion rate that my bank starts with. We learned the same thing with our ATM cards withdrawing identical amounts of money from the same machine at the same time, yet costing us different amounts from our banks regardless of the fees or lack of them.
Jan 7th, 2003, 02:24 PM
#14
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Well, having put nearly $15,000 dollars on my citibank advantage card this summer during a three month trip, I'd still do the same thing. Let's see, it may or may not have cost me an extra $300 for all that charging, but the 15,000 is exactly one-sixth of my free business class ticket (90,000) miles I just cashed in for next summer, taking me first class from Ft. Lauderdale to New York for a stay, then business class New York to London for a stay, then BA business class London to Berlin, and finally business class Paris to Miami. I defy you to find me a ticket like that (flights spread out over two months, by the way) for $1800. So I think the extra $300 was worth it to help me get those miles. I ignore those figures of how little the miles are worth in pennies. You have to know how to use them! The best I could estimate for my total ticket if I were buying it would be a little over $8000. I could have used a different card and maybe or maybe not have saved $300 (not that much compared to the total amount I did spend), but then I wouldn't be able to head to Europe like I am next summer. I prefer to do the latter. Think I'll still use my Citibank card.
Jan 8th, 2003, 10:24 AM
#15
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Sometimes it can appear they aren't charging it or you're getting a better rate (in reference to comparing to friends), but that's probably a mistake in the date. The date you made a purchase is not the date the conversion is charged, it can be anywhere from about 7-14 days after the charge date. The date on your credit card is the date you made your charge, because you have to be able to match your charges to your bill. It is not necessarily the date the conversion was made, and probably is not. Exchange rates can easily fluctuate a couple percent within a two week period. <BR><BR>I know I made that mistake myself, assuming the date on my bill was the date of the conversion and called my Capital One Mastercard to inquire as the rate appeared to be 3 pct off interbank rather than the 1 pct I was expecting (as they do NOT add on the foreign conversion fee). I thought maybe they really did and were scamming people -- they were very helpful and told me exactly what day the conversion was made and the rate. I compared it to the historical interbank rate for that day, which I got online, and they were indeed only charging 1 pct.<BR><BR>So, I think my thoughts are -- yes, you really can get a two pct difference on cards, but the rate itself may have varied that much in a couple weeks and that isn't that much money overall (to me). I don't charge much on vacations, though, maybe $1000 a week at most (which includes hotel), so that's only an extra $20 a week charge and doesn't really matter much -- IF I liked my card for a lot of other reasons and wanted to keep it. If I didn't even care about that company and having that card, I'd just as soon get a different one. I just look at the big picture. <BR><BR>I did cancel my First USA VISA and get a Capital One, partly for that reason, but also because I wanted a Mastercard to supplement another VISA I had, and because I hate First USA for a lot of customer service and marketing reasons (they constantly do telemarketing even when I've requested they stop numerous times).
Jan 9th, 2003, 10:31 AM
#16
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To Patrick and Christina: Patrick-- as usual your comments are informational and to the point. Excellent! Christina: I, too, have been laboring along with the First USA Visa for many years (with its heavy annual fee), simply for the United miles. Seems like it's time for a change. Anyone: What cards give the best mileage deals? Thanks. Sal
Jan 11th, 2003, 02:29 PM
#18
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I don't want to give wrong information, but I recall that MBNA was one of the first to charge a conversion fee. The difference was that it was included in the exchange rate rather than listed separately and was therefore transparent to the card holder. I learned about it through an article in the N.Y. Times travel section. I'll accept a correction if one is in order.
Jan 11th, 2003, 05:27 PM
#20
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MBNA does not have a very good frequent flyer program. When pitching it to you they word it in such a way that is kinda deceptive. You have to use the airline they choose - or something like that. I forget exactly what the problem was, but I do know it was not what I expected and that I wasted a lot of miles/$$$ using MBNA VISA.<BR><BR>Make sure you TOTALLY understand their offer. Read between the lines. It's not 1 mi. per $1 spent for a particular airline.
