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Foreign Currency Transaction Fees List

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I just made a trip to China and one of the interesting things I learned before I left was that a credit card will often tack on a foreign currency transaction fee if you use your card abroad – this fee is tacked onto the cost of the purchase and is used to cover the foreign currency exchange, in theory. No matter what the reason, the fee still exists and it certainly would be helpful to know which card issuer charges the most and which charges the least right? So, check out the table below:

Card Issuer Fee
Capital One 0%
Discover 0%
Wachovia 1%
Washington Mutual 1%
American Express 2%
Bank of America 3%
Citibank 3%
JP Morgan Chase 3%
Wells Fargo 3%
US Bank 3%


Visa and Mastercard automatically charge the card issuer 1% for the foreign currency transaction itself so a lot of the Visa/Mastercard cards will pass that onto the end user (which is included in the number above). Capital One is the lone exception, eating the fee, and Discover and American Express obviously aren’t on that network so don’t have that extra overhead.

It looks like Capital One and Discover are the best for this though I’d argue that you likely want to get a Capital One card because Discover isn’t as widely accepted overseas. It’s the reason why I chose a Capital One card as the best international credit card on my trip to England.

{ 49 comments, please add your thoughts now! }

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49 Responses to “Foreign Currency Transaction Fees List”

  1. Patrick says:

    Thanks for the research! My wife and I are going on a Mediterranean cruise this fall, and this will be helpful for our planning. :)

  2. Triston says:

    The banks and credit cards love these fees because nobody knows about them. Thanks for posting this. I’m actually working along side the Merchants Payment Coalition to educate consumers about interchange fees, one of biggest hidden fees out there. The industry makes over $30 billion a year off of these fees. The kicker: Only about 13 percent of the fee actually goes to transaction processing while the rest goes toward funding reward programs and direct mail campaigns.

    Thankfully, congress is starting to pay attention and is willing to tackle interchange and other hidden fees the credit card companies cherish.

  3. tinyhands says:

    The fees are relatively new, since using a credit card overseas used to be the best way to travel and still get the interbank exchange rates. I was in China 3 years ago and found it difficult to use my card anywhere but ATMs (even the domestic airlines wouldn’t take them).

  4. For myself, I didn’t realize those fees existed until I went on my honeymoon last August. It was a bit of a surprise when I got my bill at the end of the month.

    Thanks for the list; next time I’m travelling abroad I’ll have to look into it again.

  5. Kurt says:

    The implicit assumption here is that the exchange rate each one uses is the same inter bank rate? Any reason to believe one company might have a systematically higher rate (upon which the fee is added)?

  6. ordinary credit card holder says:

    I did not know about those fees. Thanks for useful information. Perhaps, it will be really better to apply for Discover or Capital One to go somewhere abroad on vacation to save some money.

  7. plonkee says:

    I’ll second the suggestion that Discover isn’t widely accepted abroad by saying that I’m in the UK and before I started reading pfblogs I’d never heard of Discover and until reading this I had no idea it was a separate card network, I thought it was just a brand of Visa.

  8. traveler says:

    Thank you for your timely info. I am about to go abroad to Taiwan and Hong Kong for a month. After reading your article, I will try to use my Discover card rather than my MC, but like the previous poster said, I don’t think Discover is widely accepted outside the US. Probably non-existant in Taiwan, I’m guessing.

  9. Hmm, if I’m looking like i’m going to be doing some out of state travelling, I’ll definitely pick up a Capital One card. Although, since I earn 5% cash back on some things via my Chase, I could still make out – if reward points are counted in foreign countries.

  10. Scott says:

    Jim, you should put another post about foreign ATM fees, especially since you just went to China where it’s mostly a cash-based society (can’t get cash back on that knockoff Coach purse!). I know BofA has agreements with a very small number of foreign banks in particular countries, like 5, and I capitalized on that in the UK (Barclay’s) and China (China Construction Bank) but sometimes those particular ATMs weren’t easy to find. And the deal is only good for specific ATMs in specific countries (a Barclay’s ATM outside of the UK will still charge you).

    Anyways, my brother who is now going to work in Europe for the next eight months claims that Washington Mutual is the best. I think he said they don’t charge fees for money taken out at foreign ATMs. Most other banks charge at least 2% and most do 5%.

    And in case anyone didn’t know, NEVER EVER EVER exchange foreign cash unless you have to. Those booths you see in airports or train stations (or even your local bank back home) will charge ridiculous fees for exchanging cash (I was left with less than $10 after exchanging $20 USD to Dutch back to USD). Stick with the ATM withdrawals in well planned amounts so you spend exactly the amount of foreign cash you take out.

  11. Note that there’s also the BMW Visa that has 0% foreign exchange fees. Also, using it earns you 1% toward a new BMW. (Granted, not quite as useful as Cap One’s 1%.)

  12. Kevin says:

    Do they show this fee as a separate line item? Just about to go to India this week and would like my company to reimburse me for the fee that Citibank is going to charge me. Thanks for the heads up. Maybe I will find a different credit card to use.

    • jim says:

      I think that depends on the company, American Express does not (but does put an asterisk and say that they charge a fee) and I’m not sure about any others. In the beginning they didn’t even note it, the just added the fees and didn’t mark it with anything!

  13. Hi! Travelling abroad is always great and we always need money as much as possible. To pay additional fees…Now I will be more accurate in choosing credit cards on vacation. Thanks for sharing this information.

  14. Anonymous says:

    I also have a discover card and the reason they don’t have a transaction fee is because you cannot use the card in China or Thailand, as they have no relationships with banks there. I called internationally to check specifically.
    Regards cheapest international banking, HSBC has branches all over asia, such as India, Bangkok, Chengdu (gateway to Tibet) etc where one can access one’s savings or checking for free cash advances, or just simply a withdrawel from other cirrus etc. ATM’s at a nominal fee. HSBC’s service for international customers in BKK is exceptional. Unfortunately the US service is one of the absolute poorest.

  15. Anonymous says:

    Capitol One appears to have removed this verbage of no foreign transaction fee from their new card disclosures, such as No hassle Miles Ultra Reward card.

  16. Jptag says:

    I’m living and working in Beijing and Discover is by far the most widely accepted American card in China. Discover has an agreement with the national payment network China Union Pay and is accepted at almost every legitimate business in the country. Most merchants outside of tourist areas don’t know this however, and unless your Mandarin is decent, expect confusion and possibly yelling. The awkwardness is definitely worth it on larger purchases.

  17. Sam Hall says:

    This clearly shows that Americans have no guts – or they are simply too stpuid to realize they’re being screwed from behind. Anywhere else in the World the people would have united in an outrage and simply stopped using the services. There are always an alternative.
    The best example of this, although not directly comparative, is in Italy where they some years ago raised the price of public transportation significantly. People did not accept that and simply started not buying tickets (but still getting on the trains/busses). When they were fined, they did not pay the fine. Eventually, it all collapsed in a horrific administrative chaos and no income and they rolled the price increase back.
    This sort of thing is called civil action and I don’t think Americans have used it since the 60′s. Since then, they’ve been affraid of any authority.

  18. Bill F says:

    It’s a little more complicated than just getting a Capital One card and leaving home. We recently spent two weeks on Ukraine and Russia and had no problem using our Capital One card. Then we fly to Amsterdam expecting to withdraw Euros at the airport. I got a minimal amount from one credit card and then planned to 250.00 Euros on Capital One. It was denied. This left us without enough cash to leave the airport. The Capital One office in the US was closed (time difference) and gave us only a recording when we called the 800#. We had to wait at the airport until 7 AM ET before we could talk to someone with Capital One. They said they were sorry for the mistake and we were able to withdraw the needed cash. We were great inconvenienced and lost nearly a day. We had advised Capital One before we left home of the Countries and dates we would be visiting. Next time we travel abroad I will leave home with a fair amount of cash of each country we plan to visit.

  19. elman says:

    Capital One Canada charges a 2.5% foreign exchange conversion fee
    I just applied online for one and I decided to read the disclosure agreement before I submitted my application and I saw 2.5% foreign exchange conversion fee for foreign transactions. Maybe US capital one is the only one that dont charge foreign exchange conversion fee

    • canada01 says:

      Thanks for the info about Capital One Canada. Does not surprise me to hear you state that the foreign exchange rate is 2.5%. MOST Canadians get hosed (compared to our neighbours in the USA) when we compare costs like this, or books, magazines, autos, clothes, cell phones — ‘system access fee!!’ etc etc). Canadians wake up, pay attention to the fees you are being hit with, and complain. The banks are raking in the profits off your backs. Speak out and save your money. And on that note, ING informed me the other day that they have NO fees for RSP account deposits, withrawls, closures. Shop around.

      • elman says:

        I just found out another thing. In Canada, Visa/Mastercard will charge 1% conversion fee and the bank will charge their conversion fee ~1.8-2.5% ***ON TOP*** of the 1%, so in Canada the actual foreign exchange conversion rate is 2.8-3.5%

        • Canuck says:

          I hold a CIBC Aerogold VISA card and following a recent trip to Europe, I found that the rate on my VISA statement is 4% (that’s right, 4!!!)higher than the Interbank posted rate for that time period (a 24-hour span between the transaction date and the posted date).
          Just got off the phone (the whole morning) with CIBC Visa and Visa International back and forth, and after speaking to a number of clueless agents, I was FINALLY able to determine that:
          1) Visa Int’l charges CIBC 1% for the conversion process
          2) CIBC charges me an arbitrary conversion rate (NOT the Interbank rate) and they will NOT disclose how that rate is arrived at or how it relates to the published Interbank Rate
          3) CIBC then charges an additional 2.5% admin. fee on top of that elusive rate, which already contains their cost recovery and a profit margin.
          When I asked how I, as a customer, can assess my transaction cost BEFOREHAND if CIBC will not disclose their formula for their own conversion rate, I was told that this may be fuzzy, but that is how it is spelled out in the cardholder’s agreement.
          When I asked what service I am receiving for the 2.5% admin. fee, since the cost of conversion (and profit) is already factored into their conversion, I was told that this is how it is, that I have been notified in the agreement, and then the manager went on to agree with my that it is not a good idea to use my Visa card abroad, that it will be more expensive than using cash! Unreal!!! How can an electronic, cash-less conversion be more expensive than a physical cash exchange??? How? Simple, it’s called billion-dollar quarterly profits…
          So for those of you, esp. our American neighbours, who thought that 3% was an excessive fee, try 4%!!!

          • Cheap Bastard says:

            If I were a Canadian resident, this is what I would do:

            Get an Interactive Brokers account. It’s a hassle to get it open and funded with $10k, but once you have it you can convert your money at market rate, with a flat commission of $2.50.

            Buy a lump sum the amount in euros that you expect to spend overseas.

            Open a non-resident euro account somewhere, and fund it from the euros in your IB account. Non-resident euro accounts will have a monthly fee, but you can close the account when you’re done with it. Wire the unspent euros back to the IB account and let them count toward the minimum balance.

  20. Cheap Bastard says:

    Is there a Capital One or Discover card equivalent for Europeans (ie. no exchange overhead)?

  21. Ray says:

    Had same problem as Bill F. On two trips to Hong Kong within the past year, Capital One denyied the card despite our calling ahead both times with our travel dates and destination. When I called from Hong Kong, Capital One acknowledged having a record of our calling ahead, but one large charge on our second day triggered their security dept. blocking charges — apparently they don’t check whether you had called ahead or not. Had to call from HK to correct — although they do accept collect calls for this.
    Reply

  22. Andy says:

    Capital One claims to not apply any fees to currency conversion when using their credit card for international charges. My experience with Capital One has been that they do not convert the currency using the daily bank rates and that Capital One uses conversions that are at higher rates than the daily bank rate and that is how they can claim they do not charge a currency conversion fee. I have taken international travel in 2008 to a number of countries and used the Capital One credit card only to find out that after I receive my Capital One statement, the currency conversion is significantly higher than that used by several other banks. When trying to resolve my issue/concern with Capital One, they first claimed they used the daily exchange rates from Wall Street Journal. When I have provided the daily currency conversion exchange rates provided by the Wall Street Journal, they then claim to use another source. When requesting their source, they claim their conversion rate is determined from multiple sources and refuse to provide their “multiple sources.” I believe I have lost hundreds of dollars from Capital One as a result of my international charges that actually reflect currency conversion rates that are much higher than the rate provided at other banks. If you plan to use a credit card for international charges, I recommend that you contact Capital One to determine how they determine their source(s) for currency conversion and make sure they document the conversion for you, so that when you receive your credit card statement, it will reflect a verifiable conversion rate. Unfortunately, I suspect Capital One will not be willing to provide you the information to your satisfaction. Good luck.

    • Cheap Bastard says:

      Andy, I used the calculator at http://www.xe.com/ccc/ to compute the cap one fees, and that tool determined that cap one charged around -1.3% on top of the wholesale exchange rate. Who knows what interbank rate they get (it seems all banks try not to disclose that), but I suspect that sometimes the difference will work in your favor, as it did for me. BTW, consider getting a Charles Schwab credit card. The schwab card also has zero commission on currency exchange, plus you get rebated 2% into a brokerage account. So schwab is the better deal because the kickback is higher. Check out http://flyerguide.com/wiki/index.php/Credit/Debit/ATM_Cards_and_Foreign_Exchange because Cap one and Discover are not the only banks offering zero commission.

      • Cheap Bastard says:

        Another thought… Capital One doesn’t do the conversion, do they? I think the conversion is done by visa, because visa charges 1% commission to Capital One (who then eats the fee).

  23. Rebecca says:

    Would love to know the same data for Canadian Banks – these extra fees really push my buttons!

  24. Bill says:

    Jim Wang obviously works for or is connected to Capital One. Read his other posts. It has been well substantiated here by other posters that Capital One uses a higher conversion rate than its competitors thus making the “free foreign transaction fee” a misnomer. It appears that Wang has an ulterior motive.

    • Jim says:

      I currently don’t have any relationship with capital one other than having a credit card. Read the USA Today article before throwing out such accusations please.

  25. Cherie says:

    I’m hoping that you will do an August 2009 review of the currency conversion and fee rates that credit cards charge in foreign lands. I am going to Europe in October and wish to know which cc I should use.

    Thanks!

    • Jim says:

      I’m in Europe now (returning home tomorrow) and we’ve been using a Capital One card exclusively.

      • Mark says:

        Jim – you are probably the best qualified to answer this, having just returned from Europe. I recently received my Capital One card and am headed to Europe in Oct. Can you tell me whether the exchange rates CO applied to your euro purchases was consistent with those published in the WSJ, cnbc.com, investor’s business daily, etc. or was actually higher? Customer svc. at CO told me that they would be using these same published rates, but others on this board seem to believe this isn’t true. I’d love to hear it straight from you.
        Thanks!

        • Jim says:

          Mark – As far as I can tell, the rates are consistent with published rates. In fact, on your bill, they tell you the rate they used on each transaction. I can’t confirm that the rates were identical because I didn’t compare them on a day to day basis (and I suspect they aren’t a daily match).

          • Mark says:

            Jim – thank you. Sorry to beat the dead horse (my wife regularly refers to me with the “A” word), but I was looking at historical US/Euro rates for the first (2) weeks of Aug. and note that they fluctuated (officially) between approx. 1.413 and 1.442. I would be curious to know if, during this time, the CO exchange rates on your statement generally fell within this range. Below is a link to where I found this data – if you have any purchases that cleared on one of the days you were there, you could certainly compare it with one of the table entries to see how close it was, if it’s not too much trouble. I don’t know whether these table entries constitute a daily average, open or close, but I don’t think the rate varies that much (lately) intra-day, so your comparison will probably be within a half percent accuracy or better, I’d guess. Thanks again! http://www.exchange-rates.org/history/USD/EUR/T

          • Jim says:

            Mark, you’re not beating a dead horse at all, this was a good exercise for me. CapitalOne only puts the conversion rate on the paper statement (or the online PDF), so I looked at conversion rates of GBP/USD for that period. The tricky part about the statement is that it shows when the transaction was posted, not when it actually happened so I have two transactions on 20 July with different conversion rates. One transaction actually transacted 19 July and the other was actually 20 July, here’s how they compared:

            19 July – Listed Rate = 0.61216, CapOne Rate = 0.614203455
            20 July – Listed Rate = 0.60485, CapOne Rate = 0.607533414

            In the 19 July rate, the difference was 0.3% in CapitalOne’s favor. In the 20 July rate, the difference was 0.44% in CapitalOne’s favor.

            Incidentally, I had another 20 July transaction that got a 0.607679466 rate (same day, difference in time by about four hours).

            I used the rates quoted from the site you mentioned and it appears to be within half a percent accuracy.

            I hope that helps, please don’t hesitate to keep asking.


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