Pay no foreign transaction fees when traveling overseas | finder.com

What is a foreign transaction fee?

Everything you need to know about foreign transaction fees and how to avoid them.

If you use your credit card overseas, a foreign transaction fee or currency conversion fee may be tacked on your credit card bill — adding to the cost of paying with plastic when you’re in another country or shopping online internationally. This page explains when these fees are charged, the potential cost and how you can avoid or minimize them.

Compare no foreign transaction fee credit cards

Rates last updated April 21st, 2018
Name Product Product Description Foreign Currency Conversion Fee (MC) Foreign Currency Conversion Fee (VISA) Foreign Currency Conversion Fee (AMEX) Overseas ATM Withdrawal Fee
Barclaycard Arrival Plus® World Elite Mastercard®
Enjoy 40000
bonus miles after you spend on purchases in the first 90 days — that's enough to redeem for a $400 travel statement credit toward an eligible travel purchase.
0% of transaction value
$0
United MileagePlus® Club card
Enjoy United Club membership, Premier Access® travel services, free checked bags, plus earn miles on every purchase.
0% of transaction value
Capital One® Venture® Rewards Credit Card
Earn 50000 bonus miles once after spending $3,000 on purchases within the first 3 months from account opening.
0% of transaction value
Chase Sapphire Reserve
Earn 50000 BONUS POINTS after spending $4,000 on purchases in the first 3 months from account opening* — that's $750 toward travel when you redeem through Chase Ultimate Rewards®.
0% of transaction value
Chase Sapphire Preferred® credit card
Earn 2X points on travel and dining at restaurants.
0% of transaction value
Southwest Rapid Rewards® Premier Business Credit Card
Earn 2x points on Southwest® purchases and points on all other purchases. Plus 6,000 anniversary bonus points.
0% of transaction value
Alaska Airlines Visa Signature® Card
Buy one ticket, get one for just the taxes and fees with Alaska’s Famous Companion Fare™ offer.
0% of transaction value
BankAmericard Travel Rewards® Credit Card
Ditch the restrictions of typical airline rewards cards. Any airline, any hotel, anytime. No blackout dates.
0% of transaction value
Platinum Delta SkyMiles® Credit Card
Earn bonus miles and 5,000 Medallion® Qualification Miles (MQMs) after you spend $1,000 in purchases on your new Card in your first 3 months.
0% of transaction value

Compare up to 4 providers

When is a foreign transaction fee applied?

couple_travel_shopping_ShutterstockCredit card providers may apply a foreign transaction fee for any of the following transactions:

  • Overseas transactions
  • Transactions made online in a foreign currency
  • Transactions made with a retailer outside of the US

Foreign transaction fees are most common for payments when you’re using your card overseas. It’s important to note that any payment that’s processed overseas can attract this fee, even if it’s made in US dollars. If you do swipe your card overseas, always pay in the local currency to avoid being hit with the currency conversion fee.

How much are foreign transaction fees?

In general, foreign transaction fees are 3% to 5% of your total transaction amount in US dollars. However, foreign transaction fees vary depending on your card and your card provider.

How do foreign transaction fees work

Let’s say you’re paying $1,000 for an overseas accommodation and use a card that charges a 3% foreign transaction fee, the additional cost would be $30. Similarly, if you were shopping online and spent $100 with a retailer overseas, you could expect to pay $3 extra. Even though this percentage can seem like a small amount, with large expenses like travel-related costs, these extra fees can add up to a substantial amount over time.

How can I avoid foreign transaction fees?

Here are some options that allow you to avoid or minimize foreign transaction fees:

  • No foreign transaction fee credit cards. These are credit cards tailored for international use and allow you to spend without any foreign transactions fees. Some of them, like the Barclaycard Arrival Plus World Elite Mastercard, come with complimentary travel perks.
  • No foreign transaction fee debit cards. Stay on the lookout for a debit card with low or no foreign transaction fees — some even waive international ATM withdrawal fees. The upside of using a debit card is that there is no interest since you’ll be spending your own money.
  • Prepaid travel money cards. Travel money cards offer the convenience of a credit card without the costs of international transaction fees or ATM withdrawal fees.
  • Foreign cash. Using cash eliminates bank transaction and ATM fees, but you may still have to pay a fee for the currency exchange. You could also use a money transfer service to send money to your destination and pick it up when you arrive. Be careful with large amounts of money — if you lose it, it’s not replaceable.
  • Traveler’s checks. These can help you avoid international transaction fees, but they are slowly being phased out because of other fees and limited acceptance.

Avoiding international transaction fees can result in some savings over time, but may not be the right option for every traveler. You should always consider a range of payment options before traveling overseas or shopping online to make the most out of your money.

Comparison of travel money products

Rates last updated April 21st, 2018
Name Product Foreign Currency Conversion Fee Overseas ATM Withdrawal Fee Overseas Cash Advance Fee Annual fee Product Description
Barclaycard Arrival Plus® World Elite Mastercard®
0% of transaction value
$0
$10 or 5% of the transaction, whichever is greater
$0 annual fee for the first year ($89 thereafter)
Enjoy 40000
bonus miles after you spend on purchases in the first 90 days — that's enough to redeem for a $400 travel statement credit toward an eligible travel purchase.
Simmons Bank Visa® Platinum
2%
of transaction value
$0
The Simmons Bank Visa® Platinum Card offers multiple perks, including one of the lowest available APRs on the market.
Chase Sapphire Preferred® credit card
0% of transaction value
$0 annual fee for the first year ($95 thereafter)
Earn 2X points on travel and dining at restaurants.
BankAmericard Travel Rewards® Credit Card
0% of transaction value
$0
Ditch the restrictions of typical airline rewards cards. Any airline, any hotel, anytime. No blackout dates.

Compare up to 4 providers

Promoted
Travelex Money Card

Why we like: Travelex Money Card

Load GBP, EUR, CAD, AUD, JPY or MXN onto this prepaid travel money card and use it at millions of locations worldwide.

  • Not linked to your bank account for safety.
  • Convert currency with a 5.50% Foreign Exchange Fee
  • Contactless payments
  • Reload, withdraw, or replace your card for free.

    Other costs to consider when using your card internationally

    couple_outdoor_with_iPad_ShuttesrstockOn top of the foreign transaction fee, the following costs could also apply:

    • Currency conversion. When spending overseas, you may be given the option to use local currency or USD. You could lose money as a result of the currency conversion before even being charged the currency conversion fee — always pay in the local currency if that’s an option.
    • Foreign ATM fees. This is a common fee when using your card to withdraw cash from an ATM internationally. Unless your bank is a member of the Global ATM Alliance that allows you to use other ATMs for free, this fee could be around $5 per transaction.
    • Cash advance fees. Another common credit card fee is the cash advance fee, which is typically around 3% to 5% of each transaction. Cash advance fees are not limited to ATM withdrawals — there are other transactions treated as cash advances as well.
    • Interest charges. If you don’t repay your balance in full and on time, interest charges will apply. With cash advances, interest charges apply immediately, so try to steer clear if you can.

    Pictures: Shutterstock

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    Kyle Morgan

    Kyle Morgan is a writer and editor for finder.com who has worked for the USA Today network and Relix magazine, among other publications. He can be found writing about everything from the latest car loan stats to tips on saving money when traveling overseas. He lives in Asbury Park, where he loves exploring new places and sipping on hoppy beer. Oh, and he doesn't discriminate against buffalo wings — grilled or fried are just fine.

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