Comments on: Avoid Credit Card Foreign Currency Transaction Fees

By: WTF

WTF — Thu, 18 Mar 2010 19:40:00 +0000

So what if I am on a website outside US borders and the transaction is in USD. I can understand if the transaction is in British Pounds or Euros, but why should I have to pay a foreign conversion fee if the transaction is made in USD regardless of the site location?

By: ixus

ixus — Sun, 25 Jan 2009 10:11:02 +0000

I just purchased something from UK using Capital One, and I can say that their exchange rate is fair enough. The GBP USD rate on that day is between 1.375-1.385. I got charged with rate ~1.386. That’s better than I expected.

By: Mister Ed

Mister Ed — Fri, 23 Jan 2009 10:19:36 +0000

Growing Greed Among Credit Card Companies:
In 2008, Bank of America and other banks started charging their credit card customers fees for making certain internet purchases. For example, a 3% foreign currency fee is charged if the transaction is processed through a foreign bank, even if the transaction involves only US dollars. This is just plain greedy. But that’s not all. On the customer’s statement, the retailer’s name is printed next to the fee, as if the retailer (or “merchant”) charged the fee, not the bank. This makes it look like the retailer is charging the customer twice – once for the correct amount, and again for the bank fee, which is not identified as such. Consequently, our customers have been phoning us to complain. All we can do is tell them that Bank of America is responsible for this scam, not us. According to one article I found on the internet, the Bank of America’s practices are illegal. (The Truth in Lending Act – Regulation E and Regulation Z – and the Truth in Savings Act require banks and financial institutions to disclose when such fees are passed on to debit card and credit cardholders.)

By: Gloria

Gloria — Wed, 14 Jan 2009 18:44:50 +0000

I live in a foreign country on US Currency, British Virgin Islands. It is the only currency we have. For 8 years, I’ve charged food, gas, electric, phone, etc. on my Citibank card. They have now begun charging me 3%, even though the transactions are all in US Dollars to start with. They tried to tell me it was ALL visa and mastercard, but that is not true. So far, I have not found another credit card charging this 3%. Maybe because Citigroup is the only one (so far) who has gone up to Washington asking for a handout of taxpayer dollars! However, if I wanted to transfer a $20,000 credit card balance to them, the rate would be 0%. They are INTENTIONALLY going after the bad credit, and punishing people like me, who pay my bill in full each month. They should never have been allowed to make their business on finance charges on bad creditors. They were supposed to be happy with the 2.5% from vendors!! How did we get in such a mess? CONGRESS!

By: Elman

Elman — Mon, 01 Dec 2008 21:10:29 +0000

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

By: Money Under 30

Money Under 30 — Mon, 15 Sep 2008 20:59:19 +0000

You definitely raise a good point about the conversion rate—I’m not surprised Capital One charges a higher one if they waive the fee. The tricky thing is you never know conversion will be used anytime you use your credit card—or debit card—overseas.

I’ll bet there are a lot of cards out there that charge a full 4% fee and have a crumby conversion rate. All the more reason to really pay attention to the credit card fees you pay.

By: Dylan Hrncir

Dylan Hrncir — Sat, 23 Aug 2008 20:50:04 +0000

I’ve seen praise for Capital One a few times, and as a military person living overseas, I obtained a card and gave it a shot. To my surprise I found that the exchange rate that I was paying is about 1% higher than the current exchange rate given by the WSJ.

When I dug really deep into the terms and agreements for Capital One, I found this: “For international transactions, MasterCard’s currency conversion procedure includes use of either a government mandated exchange rate, or a wholesale exchange rate selected by MasterCard for the processing cycle in which the transaction is processed, increased by an adjustment factor established from time to time by MasterCard. The currency conversion rate used by MasterCard on the processing date may differ from the rate that would have been used on the purchase date or cardholder statement posting date.”

I’m guessing that the “adjustment factor” is about one percent. It’s defiantly a worse rate that other cards that I have that carry a 1% transaction fee.