Scared of Money

This is about getting the most out of life for the least amount of money. And doing it with a bit of style.

Monday, April 03, 2006

Credit Card Companies Charge Extra for Using Cards Abroad

Be wary of using your credit card abroad, because almost all credit cards
tack at least an extra 1 percent transaction fee to your total purchase,
according to a recent report by Visa and
MasterCard charge a 1percent processing fee on international transactions,
and most banks add their own fees (for up to a total of 3 percent) on top of
Visa and MasterCard's fees. The only exception to this rule seems to be
Capital One, which doesn't even pass on Visa and MasterCard's fees. I'm not sure how Discover and American Express stack up since they aren't mentioned in the report but the list of fees that credit cards charge are listed below. I'd certainly avoid taking a Wells Fargo credit card abroad with me.

Capital One: 0% transaction fee. (Capital One does not charge its own fee or pass along the 1% fee that Visa or MasterCard impose.)
Providian: 1% transaction fee
American Express: 2%
Juniper Bank: 2%
Bank of America: 3%
Chase: 3%
Citibank: 3%
HSBC: 3%
MBNA: 3%
U.S. Bancorp (U.S. Bank): 3%
Wells Fargo: 3%

The New York Times ( had a great article on the cost of using credit and debit cards abroad. Apparently merchants can charge you extra for converting to dollars as well. They recommend using credit cards for the big purchases and using your ATM card to withdraw money for everything else.

Anyone else had experience with this or tips on how to control costs? I wonder if you could purchase a prepaid debit card abroad at the beginning of your trip, which shouldn't have additional costs associated with it. Hmmm....

PS - Sorry for the lack of formatting. Blogger is making me INSANE.


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