List Of Credit Card Foreign Currency Transaction Fees

Published 3/8/08 (Modified 6/24/11)
By MoneyBlueBook

Not too long ago I went on vacation in East Asia. While I was there I had the fortune to be accompanied by local friends who could spot me so I didn't need to convert my American dollars into local currency. However there were at least two occasions when I glanced upon several beautiful small wooden art pieces that I wanted to buy. While I had a few local currency bills on me, it wasn't enough to buy the slightly expensive art pieces. So I had to resort to what I ordinarily would do back home in the United States - pull out my trusty cash back credit card. Fortunately, I had the foresight prior to traveling to another country, to research and familiarize myself with credit card foreign currency exchange fees.

Watch Out For Hidden International Credit Card Foreign Currency Exchange Charges

While foreign currency exchange fees are now generally listed and disclosed by credit card companies, card issuers rarely publicize these hidden charges, preferring to leave them in the fine print. While some complain that the majority of these interchange fees are not used to process the actual currency exchange, but rather used to fund credit card reward programs and other direct advertising campaigns, the real concern is the lack of education when it comes to incurring these fees. Frequently, consumers who use their credit cards overseas come home to the unwelcome surprise of costly fees on their billing statement.

The foreign currency transaction fee for credit card purchases is comprised of two parts - the fee percentage charged by the card payment network (such as Visa, Master Card, Discover, American Express) and the fee percentage added by the card issuer (such as Citibank, Chase, Bank of America). Visa and MasterCard impose a standard 1% fee on all foreign currency charges to cover the expense of converting your foreign currency purchases back into U.S. dollars. The fee is imposed on the card issuer, but the expense is usually passed onto the consumer. Banks and card issuers that issue Visa and Mastercard also tack on their own additional transaction fee to the total - usually another 2%.

American Express does not have an extra card issuer fee, but it does impose its own foreign currency conversion charge of 2%. Previously, Discover Card was the only major card payment network that levied no foreign purchase transaction fees, however they have now updated their policy and tacked on the nearly ubiquitous charges. But then I challenge you to find a place overseas that actually accepts Discover Card. I think those living abroad probably have never heard of Discover before, likely thinking it's some off shoot of Visa or Master Card.

Credit Card Issuers That Have No Foreign Currency Transaction Fees

Capital One credit card is one of two major issuers that charges no foreign currency transaction fee for credit card purchases made abroad. While Visa and Mastercard still levy fees on Capital One - the card issuer has made the conscientious decision to waive the fees as a cost of attracting customers. Thus it looks like your best foreign purchase bet would be to apply for a Capital One Visa Or Mastercard to avoid the expensive and cumulative currency exchange transaction fees. I personally have the Capital One No Hassle Miles Card, which I use to earn 1.25 miles on each dollar spent, good for any airline with no seating restrictions, mileage cap, or expiration date on miles earned.

List of Credit Card Foreign Transaction Fees Sorted From Lowest to Highest

Today, most of these foreign transaction fees are laid out in more readable form on your monthly credit card statement. Sometimes they are denoted by a simple asterisk indicating the fee percentage that was levied, while some card issuers will list the actual dollar amount of the transaction fee portion. The transaction fees I've provided below include the total combined charges imposed by both the card issuer and the card payment network. Pay attention to some of the hidden special offers out there, especially the ones from more obscure credit unions and brokerage/banks.

Credit Card Issuer/Offer
Fee For Foreign Currency Transactions
Capital One 0%
Affinity Federal Credit Union 1%
NASA Federal Credit Union 1%
SunTrust Bank 1%
Discover Card 2% - Not Generally Accepted Overseas
U.S. Bank 2%
American Express 2.7% - Not Generally Accepted Overseas
Bank of America 3%
BB&T Bank 3%
Chase/Washington Mutual 3%
Citibank (Citi Card) 3%
HSBC 3%
TD Bank 3%
Wells Fargo 3%

Reminder Before Using Your Credit Card To Make Foreign Purchases

Modern credit card programs today implement sophisticated transaction software to detect fraudulent and unauthorized credit card activity. If your card has always been used in the New York tri-state region for example, but suddenly credit charges start streaming in from some place like Thailand or Indonesia, your card issuer may raise an eyebrow and start declining those international charges as part of their anti-fraud measures. A quick e-mail or phone call to your credit card company before you travel should prevent such an inconvenience from happening.

Credit Card Users Who Have Made Credit Purchases Abroad May Be Entitled To A Cash Settlement

If you made a foreign transaction using your Visa, Mastercard, or Diner's Club credit card at least once between February 1, 1996 and November 8, 2006, you may be entitled to claim money from a legal settlement. In response to an anti-trust class action lawsuit brought against Visa, Mastercard, and Diner's Club for alleged fraud and conspiracy to fix and conceal foreign currency transaction fees on credit card purchases to the detriment of card issuers and consumers, a legal settlement has been worked out. Under the settlement terms of In re Currency Conversion Fee Antitrust Litigation (MDL 1409), those who fall under the plaintiff class have three ways to participate and claim their settlement money.

While two of the options require that you gather your billing statements and receipts to verify the estimated value of your foreign credit card purchases, the simplest method for most is to file for the Easy Refund option, which is the route I personally took. As noted, this option is recommended if you traveled outside of the U.S. for less than one week or had foreign transactions of less than $2,500 using your eligible cards during the 1996 to 2006 period.

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151 Responses to “Foreign Transaction Fee | Credit Card Fees | Money Blue Book” 

  1. ultra says:

    i just called Fidelity Investment Amex card service, and they told me 0% FTF for my trip in Cananda

  2. Oralito says:

    Citi Visa just slapped me with.... 3% 'Foreign Transaction Fee' for buying tickets from Air Jamaica online. They stated 'If a merchant bills Mastercard/Visa from a foreign country, there will be a Fereign Transaction fee imposed. What's next? If a US company uses a foreign country based sweat shop to do their billing... Bam, 3% charge! This surely makes one feel cornered and helpless... like fish being shot in a barrel. To think that I had my Capital One in my wallet to boot!

  3. Raymond says:

    Oralito,

    This is definitely a very troubling trend in terms of foreign currency credit card charges. I recently received an email from a reader who informed me that he was charged one of those foreign transaction fees by CitiCard when he ordered extra digital phone minutes online through Skype.com while visiting relatives in East Asia. If that's true, that is a rather disturbing trend in practice by a major credit card issuer. How are we supposed to know when any particular transaction will be assuredly free of such extraordinary penalties?

    Perhaps it's best to stick to only using the credit card offers that expressly waive those type of fees for its cardholders.

  4. York says:

    I frequently travel to Japan and China. The Citi credit card hit me once, but only once. I am not going to give it any chance. I use traveler's cheque wherever accepted. Some hotels (not all) in Japan give me even a better rate than Master/Visa. I also found at least one big enough bank in China can exchange my traveler's cheque at no fees. Absolutely zero! And the rate is the same day rate. Starting from this year, I try to use my capitalone debit card to withdraw cash overseas. I don't have much experience so far. I took 20K Yen from a CitiBank ATM in Narita airport and saw $210.22 posted to my checking account. That's about right. Not sure if there will be any separate fee posted later. Bank of America confirms clearly the fee would be posted even I used a debit card. Before I see any surprising fee, I will stay with captialone debit card and traveler's cheque.

  5. Robert Hendrick says:

    My wife and I just spent three weeks in Africa and used my CapitalOne Visa (Platinum NoHassle Miles) for many significant transactions (hotels, restaurants, etc). In the US we are almost exclusively loyal to AmEx, but cannot tolerate the international fees. Before we discovered this CapOne feature, we intended to use cash exclusively during our trip. I found the FX settlements by CapOne to be completely fair, compared to the FX rates I was monitoring during our trip. My only complaint about the whole affair is that (after 3+ years of having the card with always-low balances) CapOne suddenly lowered my credit limit by over 60% DURING our trip, without any notice. I only discovered it when I had trouble paying a hotel bill in Cape Town! Not sure whether it was the sudden heavy use, the economy, or what, but it was really poor form by CapOne, and left me with a sour experience in the end.

  6. Travis says:

    that is happening to all of the major banks, Delta's Amex, Chase, GM card(GE Money bank), has all cut my credit limit to either zero or to what i owed and GM card wanted me to pay them back in full by August 1st. I do a lot of international traveling in South Korea and Japan, which left me with just my Debit card and Company AMEX. hows that for business.

  7. Ted says:

    Amen to those who said Capital One is a pain in the ass with fraud over-protection! I love the fee-free foreign transactions, but am starting to wonder if it's worth the price.
    I have had calls from their fraud dept. when in France after notifying them I'd be there demanding I verify my information, orders with merchants in the UK where I live part time denied as "possible fraud" and at least five times in the past two years, they have denied payment for my UK cable TV bill because of "possible fraud" after there's been an established pattern (I've used this same outfit for TV for years and every month they charge the fee the final business day of the month).
    They are always very apologetic and even refunded a $128 charge for calling them from France (the French system declined to accept the call collect option Capital One offers) but it's becoming a headache. At a certain time, one has to say time is money and move on and I am getting perilously close to that as with a global economy and internet purchasing and patterns being established if they STILL can't understand I'm in the UK a lot and have standing orders there for TV etc etc then maybe it's time to move on and just pay the stupid 3%.

  8. RAUL says:

    John:
    Although you do no live in the US at the moment, all you need is any friends US Address and their telephone number. Thats it; Card in the US are more reliable than in Panama; if you ever have a dispute with a merchant or stolen card; the banks in Panama will not help you, you will be stuck with the charges, that is why they want a deposit of 120% to guarantee ther funds. I am going to go with capital one.
    lets see if they dont get greedy.

  9. Ralph says:

    After reading this article, and the comments, I got my USAA card out of storage, and plan to use it for our three week trip to Italy. 1% is not as good as zero, but they're the best around as far as customer service. I like the other cards for the FF miles and other benefits, but 3% is outrageous! I recommend them to anyone who can qualify for their credit card.

  10. Peter says:

    Not a few of you seem to be confusing whether or not the card carries a fee on the one hand and what exhange rate it offers on the other. I recently checked with Bank of America. They have no "fee" but the exchange rate they quote is %5 higher than what I see on Yahoo financial.

    If I am correct--and please correct me if I am not--b anks which charge "no fee" really do charge a fee by padding the exchange rate in their own favor. Five per cent is pretty hefty.

  11. Ted says:

    You are not correct as far as I know....the fee (*annual fee) has nothing to do with whether they add a charge to convert foreign currency or not. That's totally separate and paying a high fee each year doesn't save you a penny on that foreign currency add-on. In fact the cards with the highest annual fees also seem to have the highest currency conversion fees, too.

    What all the banks we have checked do regardless of if they charge an annual fee for the card or not is go by an official foreign conversion rate from Visa/Master Card and THEN those who add a fee add a percentage to that, thus say the Visa/Master fee is 1% and the bank adds 3% of their own, the total you'd pay would be 4% but the bank does NOT add 5% or anything additional and they do not advertise no fees. ONLY Capital One does advertise NO fee for foreign currency conversion so they merely pass on the 1% but add zero of their own.

    I have never seen anyone else say no expensive annual fees have anything to do with the currency exchange charges which is why I suspect you are confusing two different fees. Stick with Capital one!

  12. doris says:

    I got a HSBC Premier World Master card, which has no preset spending limit, 1% cash back, no foreign exchange fee and charges the published forex rate. Every issue I had was dealt with fast and professionally (even a rental car accident insurance reimbursement). I find American Express costumer service usually the best, but for foreign purchases of which I have a lot as we travel plenty and have a kid in school in Europe, I use only this card and I can very much recommend it!

  13. Jinal says:

    I got Foreign Transaction Fee charged by BANK OF AMERICA.
    I used my credit card to buy the VOIP Service from rebtel.com
    Even though this company has charged me the service in DOLLARS, how can BANK OF AMERICA charge me the FTF on this...?

    You won't believe this but, I bought the same service from REBTEL.com during the month of January 2009, on that transaction BANK OF AMERICA did not charge any FTF.

    THEN WHY NOW...?
    I Made this purchase on 8/24/09...and they applied 3% of Transaction FEE on my Purchase....i.e $0.30 on $10.00 Purchase.

    Please do let me know, if you find out any solution to this.

  14. Ted says:

    Ahem...Doris, what you failed to mention is that to even qualify for an HSBC Premier Mastercard one needs $100,000+ in associated HSBC accounts, thus while the foreign transaction fee is indeed not applied, to have to give $100,000 to the bank to "qualify" lets me (and I am betting many many others) out. I got the cash but it's elsewhere making me more in interest etc, so while I'd get a transaction fee free card the cost of lower interest etc for leaving it parked at HSBC would far outweigh any benefits. You must be one of their customers.

    Jinal, a lot of banks just started this fee in the past few months. I'm betting it was tucked quietly away in those "new terms" they send us all and which for the most part we don't bother to read!

  15. John Smith says:

    ENOUGH!!! Let's call our senators and representatives -and Obama, and ask for regulation. Just bought an item using paypal -a U.S. -based company to buy an item in U.S. dollars and I still got the Citibank MasterCard Foreign Transaction Fee.

    Next we'll be buying an item (say a Sony TV receiver) at the corner store and be charged for buying from a foreign based company.

    Ridiculous. The only way to force this money-addicts (and they still asking for millions from the tax payers to rescue them from their profit-seeking stupidities that almost broght the market to a collapse) is to get goverment involved and regulate the fees they can charge.

    Better yet: don't just call your senator-rep-WhiteHouse, also WRITE them and demand regulation.

    Concurrent option: let's organize and bring a law suit over them (Banks) to refund this Foreign Transaction Fee.

    Ugh!!! Turn out you don't need to be overseas to be charged with a Foreign Transaction Fee...

  16. Ted says:

    Instead of more regulations, just look at the list: Capital One wants your business. It is obvious that most of the others are mired in GREED and do not. i find the "big NY banks:" the absolute worst for any services and do all I can to avoid Citi and Chase which are what I hear complaints about on fees, returned cheques, overdrafts etc etc, almost every day. The only reason I can't use a small bank for my cards is that many go thru the big guys to handle it, then even if YOUR bank doesn't charge, the billing agency does, so you get stuck. I do also use one Midwest bank which refunds fees...last time we were in England and France, they gave back $84 in ATM fees and charges, and THAT's customer service but we do have all our accounts there and they know us personally even with 65+ offices in 5 states. Big is not better!

  17. Nancy says:

    Based on this post and the feedback, I decided to apply for Capital One. Here is the first line on their website:
    Capital One has suspended online credit card applications.

  18. Rob W says:

    Hey fellow travelers. Here's what I found out the hard way.

    I'm currently in Canada for several weeks. We've used our CCs in the past overseas with no fees. So I started using my AAA Visa card here for everything. It wasn't until a conversation with my brother-in-law did he mention the fees. So I used online banking and sure enough, there were fees for every transaction. No need to mention I was upset.

    So he said they started using their debit card and incurred no fees (his trip was last year). So I change to using my debit card, which is with Bank of America through Visa. But I go online and check that and THEY are charging me transaction fees, MORE than my Visa CC.

    I go back online and find out that as of June 2009, most major banks started charging fees for "international" use including Canada. I also find out that I can use my BOA debit card at Scotia Bank ATMs and there are no fees. So I start using the debit card at Scotia ATMs. But I check online again and THEY are STILL charging transaction fees and even higher amounts.

    So my wife in the states calls everyone and here's what we find out.

    My AAA Visa CC charges 2% on all out of country transactions. My BOA debit card charges 3% transaction fees (1% + 2%). But if I use the debit card at the Scotia ATM, where there is supposed to be NO fees, there is now the 1% + 3% equaling 4% fees on withdrawals. The only thing waived by BOA at Scocia ATMs is the $5.00 ATM charge!

    So it's back to using the AAA Visa for now since they only have a 2% fee tacked on. I have an email into CapitalOne to verify the no fee in Canada policy and will check out Schwab as soon as I can.

    I'll let everyone know what happens!

  19. Ted says:

    Funniest part of the your post is you act as though you were not aware Canada is a foreign country! I mean you do state, "...as of June 2009, most major banks started charging fees for international´┐Ż´┐Ż use including Canada..." Did you think Canada had become part of the U.S. when no one was looking?????

    OK on a more helpful and a more serious note, two suggestions:

    I deal with a regional bank here with local offices and they refund me ALL ATM fees and extra charges when I get cash as I travel. I just take the receipts in showing the amounts when I get back, and they credit the account. If you have the ability to use a local bank or make such an arrangement, that trumps ANY deals anyone else makes. It's the local guys who can do this, so don't look for any help from the folks at Chase, B of A or Citibank cause it ain't happening.

    As far as Canada, I go so often I have an account at Bank of Montreal which is nationwide in Canada. I just walk in, hand the first teller a large US cheque, have it converted (fee is like $5 for customers paid once) and then go around getting Canadian cash out of any of the Bank of Montreal's ATMs fee-free. I also use that account for direct deposit of interest from Canadian stocks I own, so that cash is also available to me thru the ATMs fee free.

    Capital One is the best deal if you go a lot, but barring that, try one of the above ideas and you can save some cash. Oh and yes, Canada is still not a U.S. state!

  20. Dan says:

    It's one thing to travel to a foreign country and incur fees for 'foreign transactions', it's another to buy something from an internet vendor who has a U.S. business presence and get charged for a foreign transaction. I recently renewed my subscription to PC Tools online and found a 'foreign transaction fee -finance charge' on my CitiBank Diamond Preferred card for that purchase because the purchase was processed in Ireland. I was not aware that I was buying this from Ireland nor was I aware that there was a fee if it was.

    This is absolutely wrong. At the least, I should have been notified that even though PC Tools has an office if San Francisco, they would be processing the payment in Ireland. I paid for the subscription from the US with US dollars. There should not have been any currency conversion that I was responsible for.

    Since there was no way to know that I was actually buying from Ireland, I don't have any idea how I could have avoided the fee. This is so wrong!

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