I think all cards—Mastercard, Visa, Amex (don’t try Discover overseas)—charge at least 1%, some are higher—maybe 2 or 2.5%—depending on your bank or creditor. Generally speaking, credit union-issued credit cards tend have lower fees—closer to 1%—and big chain banks tend to charge the higher fees.

The only thing you can really do to stay “fee-neutral” is to get a card that has a cash-back or points programme, no annual fee, and the lowest APR you can qualify for if you plan to carry a balance. I have a card from my credit union in the “Score Card” program, and I get one airmile per dollar spent; I’ve earned 2 free tickets with that card. No annual fee, 10.5%, 1 mile per dollar spent, and some travel perks with the card. That’s the best offer I’ve ever found for myself.

Airline-issued cards are another option. Northwest has their WorldPerx Visa, Delta has their Skymiles (Mastercard?), etc. so you could get an airline-branded credit card if you plan to track miles and play the promotions, otherwise the airline cards usually have annual fees, higher APR if you carry a balance, and full fees (2%) for foreign transactions; but you can earn miles quickly, towards a free ticket, via their promotions.

—————

A follow-up… Mastercard and Visa seem to have the widest acceptance in places I’ve been, mostly northern Europe, but some places (not particular “countries”) sometimes favor one brand over another. In Bavaria, for example, I was SOL with my Mastercard; Visa was all they took in the 5-6 places I visited.

The best plan, if you can swing it, is to have a debit card on one brand, and a credit card on the other brand. A Mastercard-logoed debit card, and a Visa-branded credit card, for example. If one system is “down”—and that happens—then you’ve got the other; if some place doesn’t take one brand, then you’ve got the other.

Yeah, I was gonna say that Leave your Discover and American Express cards at home

Every card is going to have a finance fee for overseas transactions, you kinda just have to live with it, unfortunately. I think mine was 3% on my last trip, but seriously, you really don’t even notice it; just keep it in the back of your mind that everything you buy is going to cost 3% more. It’s really not that bad though (unless you are TOTALLY broke, in which case you should probably put off your Euro trip, hehe)… I mean, 100 bucks becomes 103 bucks… like I said, unless you’re buying a house or something, you really shouldn’t notice…


Another thing: if you’re thinking of getting a 0% APR card to use on your trip, wait a little bit till you get it, I just figured this out the hard way. Last week I signed up for a Chase Visa card, figuring they’d give me at least a year free of APR since I already have a couple cards with like 15 months free… well, they gave me a $3,000 credit limit, but only 6 months, starting today. Since my trip isn’t until almost August… well, you get the picture
 
EDIT: That said, they still give good deals. I think the site is like www.chase.com/access …just follow the link that says something like “our credit cards” or whatever. There’s a whole list to choose from

Just a quick breakdown on fees. Both Visa and Mastercard add 1% foreign currency conversion charge. Each individual bank then adds pretty much what they want, with 2% being industry standard at the moment. That’s where 3% comes from.
I agree that 3% perhaps isn’t much to talk about, but over many trips that adds up.

capital one sucks for the most part, but their #1 perk is no charges on int’l purchases.

What sucks about them? (just out of curiosity…)

Here’s a table updating the fees various banks charge.

I tend to use my schwab debit card overseas as well as my capital one credit card.
cheers
howie

Just to clarify my post all those fees are just for atm withdrawals using for your debit/atm card and using your credit card to buy stuff. If you are using you credit card for cash advances you will also most likely pay a cash advance fee plus finance charges start from the moment you withdraw the money unless you have some sort of special offer.
cheers
howie

Can anyone confirm CapitalOne 0% fee? VISA and MC add their fees already, what does CapitalOne do about them?

I wonder the same thing, and my hunch is that the fee is hidden in the exchange rate.

I was thinking the same thing…

Credit cards generally give you the interbank exchange rate and I’ve noticed my c1 card to be pretty close to that.
cheers
howie

1) they don’t report your credit limit to the reporting bureaus, so people checking your credit will see $xx on your balance, but they can’t see what percentage of your limit you are using. this is pretty crucial to your credit score.

2) can’t convert credit card programs. i currently have a capital one card that i got when i was a broke college student, so i don’t get rewards or any other decent perks. now that i have a lot more money, spend freely, and pay my balances in-full and on-time every month, i’ve been pleading to convert to a rewards program with no success.

3) they are very stingy with credit limit increases (and limits in general).

4) capital one will do 3 hard pulls (each bureau) on your credit report pretty much any time they are legally allowed to. this can be brutal on your credit score if you have a short or mediocre credit history.

there are many, many more reasons why they suck. but when travelling abroad, i see no reason not to use their cards.

Thanks everyone for your input! I’m looking into Capital One and if not, I will just stick with what I have.

Hey, I have just a general question for anyone who knows the answer. Okay, so I have multiple credit cards (I think I have at least 4 or 5 right now) but I don’t use 4/5 of em AT ALL. Should I just cancel them, or does that “look bad”? Also, how exactly do you cancel one anyway (seeing as I’ve never had to haha) Thanks

looks better to keep it, even if you don’t use it.

Capitol One is the only card I have found with no transaction fees.  One poster wrote that some companies bury their transaction fees in the conversion rate.  They (all the credit card companies) used to not show the transaction fees then they were taken to court by a class action suit and they lost so they now have to show that fee.  One other tip for all travelers regarding ATM fees.  There is a bank in Maine called Bangor Savings Bank that has NO ATM fees anywhere/ever.  When a fee comes in on the paperwork they reimburse you into your checking account.  Sweet.  An account can be set up on line for the adventurous travelers not lucky enough to live in Maine LOL.. 

no need to go to maine.. i think commerce bank reimburses your fees as well.

Many travelers worry about using money belts, etc, to protect their money, but, in my opinion, these charges are nothing but legalized theft. Think about it: If you charge 1000 euros on your trip, and a computer does the “work” of converting the cost of your charges into dollars, and you’re charged $30, it seems like a small amout. But, multiply that by many thousands of travelers, and the credit card issuers are making a huge amount of money for exactly nothing. Suppose that you were the victim of a pickpocket who got away with a similar amount—- you’d remember that for years! Remember that merchants are also absorbing fees on your purchases!

I see your point, Basie, but not sure I agree. Who wrote the software? Who pays for the infrastructure that allows us to withdraw local cash from a machine in our own language half-way round the world? Who pays the bills, for the HR dept, for the intellectual property? It’s a legit charge, IMHO, but of course it’s always nice to have freedom to shop around and get the lowest charges possible.

if i didn’t have a capital one card, i wouldn’t mind paying 1% fx fee. just the price you pay for convenience. and all things considered, the rates are a lot better than what you’d get at most street exchange booths.

Min $1000 balance with commerce to get fees reimbused. I bank with charles schwab bank online and they reimburse atm fees with no min balance.
cheers
howie

Don,
About your comment about the mastercard and being SOL in Bavaria, you said that your mastercard didn’t work and visa did.. My wife
and I are traveling to southern germany this summer, and we only have a
MC, would you suggest us getting a visa also??
Thanks for your time

Don, I don’t get your point at all. Merchants who accept the cards are assessed fees by the banks that handles their transactions, and banks pass some of those to Visa/MC to pay for “the infrastructure, the bills, the HR dept, and the intellectual property.” Arguably, it is unfair that merchants have to pay for the convenience that we enjoy. But it surely does not cost Visa/MC entire 1 percent to make conversion, and it clearly costs US (and other) banks nothing extra to bill you simply because the transaction originated in a different currency. They do it just because they can!

About different cards being/not being accepted in different areas. I guess you just should not assume that credit cards would be accepted everywhere you go. In most of Germany, for example, very few clients in rural area restaurant would pay with plastic, so there is very little sense for an owner to set-up a terminal. You may want to have some amount of cash on hand, say to pay for your meals for a couple of days. When you check-in at a hotel, make sure it accepts your card, if not get money from an ATM before check-out.
(My combo is MC credit card plus Visa check card. But in German restaurants I normally pay cash anyway.)
 

that’s why their websites are visa.com/mastercard.com as opposed to visa.org/mastercard.org.. they charge a fee above cost because that’s how businesses work.

plus, conversion might not have direct costs that large, but what about setting up regional sales & support offices, taking on interest rate risk, hiring specialized legal/compliance teams to ensure that they’re in line with whatever business laws each region has?

i’m really not sure how you could whine about this.

I’m not wining about Visa and MC and the fees they collect. After all they make travelling and simply buying stuff lot more convenient. Still, participating banks charge the merchants processing fees of 2-5 percent, and clearly these fees offsets extra cost of currency conversion.

My point is that if a bank decides to issue you a credit card, and chooses not to collect any fees from you, when you use it in your own country, it implies that issuing credit cards is a profitable business. And it would remain equally profitable, even if the bank treated the transactions originated abroad the same way. So adding up its fee on top of Visa/MC’s fee has no economic justification. As you know, a few years back this practice was deemed illegal in the US, because the banks even did not bother to disclose those fees in customer agreements. So now they do and it’s all legal, but still IMHO unfair.

okay… take what i said and apply it to the banks instead of visa/mc. maybe less administration on their end, but in the end they’re still businesses.

if i ran a bank, and i had a choice of all of my customers using cards domistically or abroad (all else equal) i’d choose domestic. why? because who knows? things happen. that could justify fx fees.

if you don’t like it, then switch to capital one. call up your current creditors and cancel your cards citing fx fees as the reason.

i just keep a few cards and use whichever one benefits me for each particular transaction. it’s pretty simple.

Well, that was exactly the fate of my two MBNA cards. After MBNA was swallowed by Bank of America, I’ve called the behemoth, and told it that I’ve got my cards for all the perks they had, and that I did not want them anymore.

such is capitalism. you’re given tons of options, so take advantage. no damage done, everyone wins.

It’s very easy to find out what credit card you should use for your foreign trips, especially because this card might be different from country to country. I usually use this credit card comparison site. I recommend it to you!

Timada, that’s a great comparison tool. One note: Because of the way the merchants get paid, Discover and American Express are not nearly as widely or as happily accepted in Europe as MasterCard and Visa. If you’re staying at Hiltons it wouldn’t be a problem, but would not try to travel Europe with only a Discover or American Express card as a budget traveler.

My card wasn’t from a major bank like Citi so i asked them if there would be a problem with it being used over seas and thankfully i asked becuase they said if i didn’t and they saw transactions from some other country it would have been frozen because of their security policy. It worked while in Europe but with their fee’s and the cost of the Euro it was pretty expensive. Now when I go I just order euros from my bank to have cash on me and got some instant approval credit cards that are secured to have which don’t have interest i just load them with what i need.

I moved this reply so everyone will hopefully read it so everyone will learn and be prepared!
Please don’t ask legal banking questions to backpackers.
Call your bank directly and call VISA directly to find out all the fees first hand from the policy makers.
PLEASE NOTE TO ALL TRAVELERS that Each bank is different and many credit unions do not charge the 1%-3% transaction fees. (3% is $30.00 per $1,000.00USD spent in Europe).
Do NOT assume the answers given here are the same for your card – CALL YOUR BANK TODAY AND GET THE CORRECT ANSWERS FOR YOUR CARD.
If the customer service rep is not giving the information you need, kindly ask to speak to a supervisor or manager.
One female asked us about Gift Cards – CALL YOUR BANK!
Questions: VISA GIFT CARD (do again for your Credit Card)
Is there a limit one can place on a VISA gift card?
Is a person’s name printed on the card to prevent others from using it.
Can a VISA Gift Card purchased in the U.S. be used in Europe for all purchases, ie, hostels, restaurants, BARS, trains, museum admissions, etc.?
Can the VISA Gift Card be used at an ATM with the VISA logo?
Any fees added on to use as an ATM card?
What happens if gift card is lost or stolen?
Get phone numbers to call collect from Europe and ask if they have TOLL FREE/800 numbers to call from Europe?
When do I need to call you, the Bank/how far in advance to inform you that I will be using the card in Europe so that I do not get shut off for fraud/security alert/unusual transactions?
Can a replacement be shipped overnight to Europe?
Are there any Currency Transaction Fees or Foreign Transaction Fees when using a gift card in Europe?
Are there fees for minimum/small charges like 5.00, 10.00, 15.00 20.00?
(For example using it to buy a sandwich and a drink for less than $10.00)

Do us all a favor and ask the same questions for your credit card and ATM card and list the answers.
For ATM ask the following;
What happens if ATM card is lost or stolen?
Get phone numbers to call collect from Europe and ask if they have TOLL FREE/800 numbers to call from Europe?
When do I need to call you, the Bank/how far in advance to inform you that I will be using the card in Europe so that I do not get shut off for fraud/security alert/unusual transactions?
Can a replacement be shipped overnight to Europe?
Are there any Currency Transaction Fees or Foreign Transaction Fees when using a ATM card?
Are there any NON-BANK ATM charges. When you use your ATM at a different bank ATM, Post Office ATM, etc.
Do you have partner banks in Europe that will NOT charge the fees?
Any fees for minimum/small withdrawals/ like 20.00, 25.00, 30.00, 40.00 50.00???
Verify your pin # is 4 didgits.

Most banks now say that you should not sign the back of your card – write in SEE I.D.
Also place a piece of clear scotch tape over the 3-didgit security number on back so it does not wear off. If it does, you have to order a new card.
ATTN POSTERS: Please don’t confuse readers and give your answer, assumed answers or opinions to any of these questions unless you call your bank and post ALL your bank answers.

Thanks for the credit armageddon.

The Starwood Preferred Guest® Credit Card is one of the most popular credit cards among the really frequent fliers and travelers. This is because it has probably the best hotel reward program, but also allows you to transfer points you earn (at a one for one ratio) into miles of over 30 airline partners. Furthermore, you get a 5,000 airmiles bonus if you transfer 20,000 points into miles. Effectively, you only need 20,000 points or miles to get a free domestic flight (since most require 25,000 miles!). Many American Express Centurion and Platinum cardholders also carry this card. The $45 annual fee makes this card a great bargain even if you do not stay at any Starwood Hotel.

express blue

The newest rules on credit card which taken effect August 22 have been celebrated as victory for consumers since it offer protection in many ways. The latest rules limit late payment fees and other penalties. Charge card reform began with the Credit card Accountability, Responsibility and also Disclosure (CARD) Act for 2009. As of Sunday, all the new rules collection forth in the legislation has now been enacted. Average penalty fees for past due payments under new federal laws can’t exceed $25.New rules have been gradually introduced that are cutting into lucrative penalty fees. In response, credit card businesses have dramatically hiked interest rates. Another rule needs them to justify those increases to federal regulators.

This thread is nearly 3.5 years old. Time to check back in.

Using credit cards overseas, these are the variables:
1. Exchange rate
2. Foreign currency transaction fee
3. Cash advance fees (i.e. trying to use your credit card to withdraw cash—quick answer: don’t! You’ll get stuck with a fee from your credit card just for cash advances, plus you’ll be charged the APR until it’s repaid)

Using ATM cards overseas, these are the variables:
1. Exchange rate
2. Foreign currency transaction fee
3. Your bank’s fee for using an out-of-network ATM
4. The out-of-network ATM’s fee.

The best case scenario, in my opinion, is 1 Visa and 1 Mastercard. One card should be a credit card, and the other an ATM/debit card. ATM cards need a 4 digit PIN in Europe.

Shop the above mentioned variables — except #1 the exchange rate, which you can’t control, but is usually the best available rate, anyway. Visa and Mcard add 1% automatically on foreign currency transactions. Some banks issuing Mcard or Visa cards will add additional fees on top of that — 1, 3, even 4% more. Some banks don’t add anything, and some will “eat” the 1% that Mcard and Visa charge.

For ATM cards, also shop what your bank charges for out-of-network ATMs. Some banks add fees, some don’t. Look for partner banks and ATM networks with good availability where you plan to travel. Finally, some ATMs will add an additional fee regardless — usually disclosed before you decide to complete the transaction. Not so bad with occasional withdrawals, but on a long trip with frequent withdrawals, of course it adds up.

Fortunately, nearly all banks and credit unions have their card fees posted online, or just a phone call or email away, so it’s fairly easy to shop for the best overall rates.

The best card in the world? Maybe one that “eats” the MC/Visa foreign currency fee, has extensive overseas network of ATMs with no additional fees on either end, no annual fees, and that gives cash-back. I think Penfed has one like this with up to 2% cash-back.

Myself, I’m happy with my credit union cards which currently charge the MC/Visa mandated 1% on foreign currency transactions, allow me 5 free “foreign” ATM withdrawals per month, no annual fee, and earns 1 air mile per dollar spent. It’s the best among my local banks and CUs, but I could probably do better if shopped nationally.

————

Worth noting: US-issued cards still use magnetic strip technology. However, Europe is rapidly adopting chip + PIN cards. Technically, if MC or Visa logo is displayed, they are supposed to take your card, but in actuality, this doesn’t always work out. Before sitting down at a restaurant, best to show your card and ask if they will accept it, noting it’s not chip + PIN. Even if they say they will, it doesn’t always work, so best to spot nearest ATMs before going into a restaurant, or making a large purchase. I have never had a problem with ATM machines accepting magnetic-strip cards. Some train ticket machines also will take my ATM/debit card, but not credit card… go figure.

Also beware credit cards that allow cash withdrawal. They might sock you with hefty cash advance fees and charge interest until it’s repaid.

Call your card issuer before travel and let them know which countries you will be traveling in. Don’t just say “Europe” as most CR reps I’ve spoken with could barely name one country in Europe if their life depended on it. Break it down and name each country you plan to visit. Failure to do so will get you nice security messages left on your US voicemail (even if you gave them a foreign number) saying they will disable your card unless you phone them back to verify the suspicious overseas charges.

all of these credit cards will charge you