Foreign exchange fees on credit cards

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Dear Keith

Thanks so much for compiling your Point Hacks Master Overview Table of credit cards which is incredibly useful.

Would you be able to add FX conversion charges and overseas ATM withdrawal fees to your table as I travel overseas a lot and have found that the FX conversion fees charged by some credit cards can be up to 3% on each transaction.  By comparison, the 28 Degrees MasterCard (issued by GE Money) doesn’t charge an annual fee, nor any FX fee on overseas transactions.  However, the downsides are that it doesn’t earn any points and from 1 Jan 2014 it charges a cash advance fee of 3% or $4 whichever is greater.  I’d love to know if there’s an even better card for overseas travel that doesn’t charge FX fees or ATM withdrawal fees, but that does earn points.  That would be my Holy Grail!

Many thanks

redmia

  • Yes, I’m definitely going to add these in! The other answers are all excellent and outline the cards which do offer more points or no fees very well.

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Great Response
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Hi redmia,

As a regular but infrequent overseas traveller, I have been keeping an eye on these charges too.  The vast majority of cards charge 3% with the main exception being 28 Degrees (as you mentioned).  AFAIK, the only mainstream cards with better than this are the Bankwest Platinum cards (0% on both QF and their own Rewards). But the higher annual fees on these cards don’t offset the savings for me though may be worth it for those with higher overseas spend.

However I have noticed that some cards are now charging 3.3% for overseas transactions.  Hopefully this isn’t a trend.

Some cards do offset these fees with Bonus Points as listed in the Table.

All in all, I suggest that the overseas fees and cash advances charges are added the “Master Credit Card Table” by exception, i.e. where they offer significantly better or worse rates.

Andy

  • Actually, Bankwest Zero Platinum is a $0 annual fee card which has a 0% FX rate. So definitely a good deal if you’re looking to minimise exchange fees. Anecdotally, it seems like they’re more reasonable on credit limits than the 28 degrees card (have heard of a number of ridiculously low limits – e.g. 20% of comparable competitors – being applied to friends applying for 28 degrees).

  • Good spot! Thanks

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Great Response
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Most charge in the range of 3 to 3.5%.
The best option for points collectors overseas (in my opinion) are the Citibank Prestige and Signature (not the Citi Qantas Signature version). Yes you pay the FX fee, but if you just see it as buying points, the value I personally get from the points for me outweighs the FX charge.
It works out at buying points for 1.1c for Signature or 0.9c for Prestige. So if you transfer to the right points programme, you’re paying (in FX fees) the equivalent of $898 ($1,123 Signature) for enough points for a one way in first class to Europe from the East Coast and it’s even cheaper from the west coast…
So you can ask yourself the question would you rather pay zero FX fees and stump up a similar amount for an economy ticket or pay the FX fees and fly first class?
For me it’s easy. You may have different travel requirements or destinational aspirations so it’s for everyone to make up their own mind on what’s best.
Hope that helps!

  • I think that’s spot on – except if your points are stashed with Qantas. If you’re with the right programme (Velocity and KF especially) as Dave notes, then you can get a lot of value from overseas spend on the Citi card.

    However, if you spend with Qantas, you don’t get bonus points for overseas AFAIK so you’re effectively buying points for the FX conversion fee (3% from memory?). In that case, it’s not worthwhile unless you value QF points at 3c plus (I don’t).

  • Note that the Citi Signature only earns good points on international spend when enrolled in the Citi Rewards program. No bonus points when using Qantas program.

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To add another option: I use an ING card when overseas: 2.5% on purchases, and a flat rate of $2.50 for international ATM withdrawals. When I last did my research I found this better than the big bank fees or various ‘travel’ credit cards.

This is a winner if you need some local currency on the ground. Other cards charge a %age of your cash withdrawal as well as an ATM fee.

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