Card Currency Exchange
A credit card becomes trustier when a cardholder travels abroad.
Aside from booking flights and hotel rooms, there are just instances when one becomes more thankful for having a
credit card. Being able to shop in a foreign country is very appealing but having enough cash for it is difficult
to pull off. With millions of ATMs accepting Visa or MasterCard, taking cash advances has become a lot easier and
less stressful. However, with this ease and comfort comes the credit card currency exchange rate
that is bound to weigh down on a cardholder’s pocket when the bills start to come.
What is a credit card currency exchange fee? This is a fee that is imposed on every transaction that touches a
foreign bank at any point. Hence, a cardholder need not necessarily be on foreign soil to pay for a credit card
currency exchange fee. Most credit card currency exchange fees are taken from online transactions that use a credit
card for payment. So, when you buy a dress or bag from an online seller who uses a bank account in France, you are
bound to pay for a credit card currency exchange fee, even if the shop is addressed at another state or if the
currency used is US dollars.
Most credit card currency exchange rates are shared by two companies: the issuer of the card or the bank that
manages the card and the card payment network company (i.e. Visa, MasterCard, and American Express). Most card
payment network companies take an interchange fee of 1%. This, according to them, is done to cover foreign currency
conversion expenses. Card issuers and banks, on the other hand, also take a fee for every foreign transaction made
on the card, which according to them is done to fund rewards and maintain ATMs worldwide. Issuers usually have a
higher percentage in a credit card currency exchange fee, around 2%.
Most credit card currency exchange fees charged range from 1% to 3% of the amount. American Express and Discover,
which ironically are not usually accepted overseas, both have a credit card currency exchange fee of 2%. Bank of
America, Chase or Washington Mutual, Citibank, HSBC, PNC, TD, and Wells Fargo all charge a 3% credit card
currency exchange fee. Only a few credit card providers do not have a foreign transaction fee. These include
Capital One, Schwab Bank, and Stanford Federal Credit Union (SFCU).
However, before swiping your credit card in a far eastern store, you are advised to give your credit card company a
call in order to prevent suspicion of fraud when your card starts receiving transactions from a foreign country.
Sometimes, because cardholders do not give notifications, companies start declining the credit cards that are
suddenly used someplace else.
Source: Credit Cards For People With Bad Credit Rating
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