Ugh: I Paid Credit Card Foreign Transaction Fees Today

Filed Under: American Express, Chase
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One of the many great improvements we’ve seen with credit cards over the past few years is that so many mid-range cards now don’t have foreign transaction fees. This makes it lucrative to use many cards when traveling abroad. For example, cards like the Chase Sapphire Preferred® Card offer double points on dining and travel, so not only do you pay no foreign transaction fees when abroad, but for many of us that means we’re earning double points on most of our purchases.

At the moment I “only” have 17 credit cards, and nearly a dozen of them don’t have foreign transaction fees. So when I travel I have no trouble avoiding those fees. However, today, through a series of unfortunate circumstances, I made several purchases with foreign transaction fees. How did that happen?

Well, first of all, I should explain my wallet situation. I have a couple of different wallets I use. I have one traditional wallet, which has my backup cards, plus a money clip, which has the primary cards I’m using at any given point.

Typically both are in my carry-on at all times, though when I’m out and about, I usually only have my money clip with me. I change which cards are in my money clip based on which cards it makes the most sense to put spend on at any given point. So in that money clip at the moment are the following cards:

Well, we’re in Italy at the moment, and today we went on a day trip. Unfortunately I made six purchases with the Chase Freedom Unlimited® today, which does have foreign transaction fees. While the amount wasn’t huge, this kills me a little bit inside.

So, how did this happen?

  • I can’t use the Chase Sapphire Reserve at the moment, since I had some fraud on the card and am waiting on a replacement, which I haven’t been able to get my hands on while traveling internationally
  • My backup plan was to use the Citi Prestige Card, though for whatever reason it hasn’t been working anywhere; the card has a funky design so I’ve had to show everyone how to insert it into the chip reader or slide it, but even the transaction doesn’t go through, and I’m not sure why
  • My backup then was to use the Starwood Business American Express, though not a single place I’ve been today has accepted American Express
  • With Amex cards eliminated, my only option left was to use one of my Chase cards with foreign transaction fees, so I used the Freedom Unlimited so I’d at least earn 1.5x points. The way I see it, the rewards are basically a wash with the fee, but I’d still rather use a card so I can keep track of expenses, rather than paying cash

I guess for the rest of the trip I should put The World of Hyatt Credit Card in my wallet, since it has no foreign transaction fees, is a Chase card, and offers 2x points on dining. It seems like the next best option in this case.

I never thought I’d be paying foreign transaction fees in 2017, especially when I have four cards with no foreign transaction fees in my wallet, but oh well.  You’d think I could follow my own advice!

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  1. If you call and explain that your other Chase card wouldn’t work, they will waive the fees.

  2. You should add some cards in Apple Pay. In the case your physical card is compromised the virtual one will be remotely updated and you can continue using it. Almost everywhere overseas accepts tapping.

  3. Our Prestige cards have been failing also. Very painful to talk to the fraud Dept on every transaction. Faiked at dining and an electronics store in NYC. Also failed in MX. And….. The Citi Costco card failed at Costaco in MX. After 10 mins they removed the fraud protection. We are done with it unless booking hotels for 4th night free.

  4. The fraud thing is so freaking annoying. Especially given how frequently it happens.

    Last month I had a fraudulent charge on my CSR on Sunday and I left for a work trip on Monday. Chase “overnighted” the replacement card but it didn’t arrive until Tuesday. So a nice big hotel charge and restaurants from that trip all went on the Freedom Unlimited. At least it was a domestic trip…

  5. Lucky as a Chase Private Client you just need to call your CPC banker and they can get these fees credited back to your account. They can generally rush a card to replace the Sapphire Reserve in three business days even internationally. These are just a few of the perks for Chase private clients.

    Love your posts

  6. I had a similiar experience yesterday, in the Netherlands, where none of my “no forex fee” cards would work. Oh well given the favorable exchange rate, I shouldn’t complain.

  7. Do you have the old Citi Prestige design with the mag strip on the front + chip on the rear? If so, you can call Citi and have them issue the updated design, which has the standard / “non-confusing” layout.

  8. In Canada, practically every card still has a foreign transaction fee, except for a mediocre Chase-issued Marriott Rewards Card. Every. Single. One.

    Add that to the mediocre selection of credit cards, Aeroplan going away, and the bloody dollar, it doesn’t make any financial sense for Canadians to travel at the moment.

    A small price to pay for having a Prime Minister who looks like the prince from Tangled.

  9. I ran into a strange problem a few weeks ago when I had to take a cab from Detroit to Windsor, Canada to catch a flight. Because I was outside the US, the taxi company’s POS system wouldn’t work. As a result, they had to use the old manual device to make an imprint of my card on the receipt. I couldn’t use CSR or Citi Prestige and instead had to use my Amex Platinum (thankfully haven’t received a metal card yet) because it was the only one I had with raised numbers. I ended up losing 3x points on travel.

  10. I did the same today trying to meet the spend threshold on my new AMEX Blue Business Plus. Oh well, so I am now out 82 cents, and I will never use this card for anything EVER after I hit the threshold. Stupid that AMEX charges the fee. Their loss in the long run.

  11. See, you can’t have too many cards 😉
    Actually, is is funny how the couple of bucks on a foreign transaction chaps our collective hide.

  12. @Gene I’m curious why you wouldn’t use the Blue Biz Plus for anything after hitting your signup bonus? I love the 2x MR on everything. My current card strategy is Amex Plat for air travel, CSR for dining and rental cars, Blue Biz Plus for all others. I like having the CSR and Amex since both can transfer to KLM/Flying Blue and I’m a Delta/SkyTeam flier.

  13. @Ladytravelbanker sez: “Lucky as a Chase Private Client you just need to call your CPC banker and they can get these fees credited back to your account.”

    I just became a Chase Private Client (CPC). They offered it to me very aggressively and even waived the requirement to maintain a minimum average daily balance of $250K across Chase deposit and investment accounts [I maintain only about 1/3-1/2 of that]. This supports the rumor that at Chase’s discretion the minimum average daily balance can be lowered considerably for long-time Chase customers with a solid credit history (that would be me).

    Anyway, in addition to the possibility of having the “5/24” rule waived me if it ever got in the way, I was excited about becoming a CPC because of associated banking and travel benefits, which include a host of fees waived:

    — No Chase Fee at non-Chase ATMs (including international ATMs). Will refund ATM operator fees up to five times per statement cycle.
    — No fee for non-ATM Cash transactions (e.g obtaining cash from a teller using Chase debit card)
    — No exchange rate adjustment fee for debit card purchases and ATM withdrawals in currencies other than U.S. dollars
    — No Chase fee for all domestic and foreign wire transfers, incoming or outgoing.
    — No fee for counter checks, money orders or cashier’s checks
    — No fee for personal style checks when ordered through Chase.
    — No fees for stop payments
    — No fees on deposited items returned, cashed checks returned and collections (domestic and international)
    — No fees for insufficient funds and returned items, Overdraft Protection Transfers or extended overdraft.
    — No monthly fee (waived on linked savings accounts and linked business accounts)

    As you can see, one fee that is apparently not waived is the one you claimed @Lucky could get back by calling his CPC banker. My understanding is that for a CPC, foreign transaction fees are waived ONLY for ATM or non-ATM CASH transactions, and NOT for foreign CREDIT CARD transactions.

    It would be too good to be true, but maybe you know something that we do not…

  14. If they don’t have transaction fees then they probably tack on 2% to the exchange rate. Six of one of a half dozen of the other, you make the call.

  15. This will be a bigger issue in the case of they dying Citi Hilton Reserve vs. Amex Hilton. The Amex has a 3% fee.

    Charlie McMillan- I get interbank rates on the major currencies, I don’t find they make a spread that is noticeable.

  16. Dont know why bother taking Amex internationally- 99% of places dont accept bloody Amex outside America anyway

  17. As Seams said. Every Canadian cred it card has foreign transaction fees. Add to the fact that they make money on exchanging the currencies to CAD just means they’re gauging. There’s no need for the foreign transaction fee.

  18. @schar I travel in Europe with amex routinely, and rarely have a problem. I do carry a visa, as well, but rarely have to resort to it.

  19. As someone who works abroad and travels to some places that are even more remote places than where you end up, I can make a few suggestions to rectify the situation:

    When you report the fraudulent activity you can tell the representative that you are overseas and they can send it to you usually via DHL or UPS directly to where ever you are now or will be next (or perhaps will be in five days time). I have had cards arrive in Asia, Africa, and to some small towns internationally without a problem. They will send you the tracking information so that you can track it.

    Call Chase Customer service. Often times due to the fact that you have multiple credit cards and I presume more prestigious bank accounts, etc with the institution they can make an occasional allowance and reverse the charge.

    It is important to note that different from what some others imply, they will not turn your cards that charge a foreign transaction fee into a fee free card, but they can reverse the foreign transaction fee for some occasional mess ups.

    With this said, in this case, I would just tell them the truth that you made the charges there because of the promotion and because you did not have The Reserve card on hand, and forgot about the fees.

  20. This would require an intense study but I’m starting to wonder if my cards with lower or no fees don’t just charge less faborable exchange rates. I know that when a foreign merchant asks if you want the charge in local currency or US dollars, you always gok for local currency as they actually get a cut of the dollar transaction. But since my expense program, Concur, always makes an assumption on the exchange rate and I then have to correct it, the card company must be manipulating it to get some more juice.

  21. For Citi prestige, it works better overseas if you go online and put in travel notifications, less declining and fraud problems.

  22. I’ve had a problem with the Citi Prestige declining lately. Same card as I had a year ago and had no problems then (when I was in Turkey). I went to Guatemala about two weeks ago and did put in a travel notice. I got to the hotel and they ran it twice and it was declined. I had my phone with me and never received a text or anything about it. I ended up using my SPG Amex which went through fine. I called Citi the next day and they said it had been declined because of potential fraud. So you might want to call and check if that was your issue too. I explained to them that I was very frustrated as I had put a travel alert on and never received communication where I could authorize the charge. I was traveling for business so can’t go out with a card that could be declined so had to switch my spend. Not sure if Citi has changed something lately but it’s making me consider whether or not I should renew it in a few months.

  23. We have been traveling for a year now and enjoy your content. We love to use Apple Pay where possible. No need to take your money/wallet out so that stays secure. No need to slow things up while you wait to sign the receipt if not chip/pin.

    What I really hate and would love to hear what others feel is the 3% Conversion Fee that Airbnb charges you when you have a US issued credit card (CSR, Citi Prestige) and book a airbnb rental in a different country and currency. In my opinion it is a very hidden fee and when you combine it with the poor exchange rate it is a big airbnb rip off.

    Again…. would love to hear from others on this. It really does add up and was one big reason to have a credit card that does charge conversion fees – but airbnb does no matter what if booking outside the US!

  24. > This would require an intense study but I’m starting to wonder if my cards with lower or no fees don’t just charge less faborable (sic) exchange rates.

    I’ve often wondered the same thing. If the no fee card gets a lousy exchange rate, the fee-based card could actually be a better deal. No one likes fees so if you hide them (as is done with mutual funds) then consumers think they’re getting a better deal. One of these days when I’m abroad I’m going to make two identical purchases with two different credit cards and see what’s what. That would not be definitive, but it would be interesting.

  25. I don’t understand the comments about Canadian cards charging foreign transaction fees. I presume such a fee would be a separate line item, which I have never seen. Yes, they do probably charge a slightly unfavourable exchange rate, and my Amex converts foreign currency to US dollars before converting to Canadian dollars, which I assume would get me twice, but I have never seen a separate foreign transaction fee.

    Am I missing something?

  26. Load your cards onto Apple Pay, then you can tap anywhere and don’t have to sign. Useful in Europe and Australia because they tap their cards.

  27. It’s also worth to remember that even when you’re paying no FX fees you’re still losing money on foreign currency transactions due to spreads each bank / “point of sale” charge.

    For example you’re paying by your USD credit card in EUR and current rate is 1.11. You will be given 2 options: charge in EUR or in USD. In both cases the rate will differ from 1.11 due to either banks fx spread (they could buy EUR for 1.09 and sell for 1.13 let’s say) or PoS spread.

    Based on research you will get better rate from your bank on average – that means that you should ask to charge you in currency local to the PoS (EUR in our case), however you’ll still finish with incremental charge of about 2-3% which will make the transaction not worth the miles you’re earning. So cash is the best option here assuming that you could change with lower spread (which could be or could not be the case).

  28. AMEX is a pain overseas. it seem slike i am always trying to meet a min spend while travelling and i have to use a card i have already had for a wallet because almost no one accepts AMEX.

  29. I had a fraud issue shortly after getting my Chase Sapphire Preferred, while I was in Europe. I talked to the agent and explained that I really wanted to use the card while traveling, especially since I was trying to meet my minimum spending requirement. They said that since the fraud was happening in the U.S. they’d let me keep using it overseas and would cancel once I arrived home. It would not be good in the U.S. – only in the countries I was traveling (the Balkans). I was very happy with that solution.

  30. @Ed Juline @Robert F I monitor the exchanges rates pretty closely on my cards when I travel overseas. Sometimes I need to use a card with a fee because of specific insurance protection, etc. Over about 10 years, I’ve not noticed a material difference between the FX rate on cards with fees vs. without fees, whether I’m using a credit card or my ATM card to get some loose cash. It’s almost always been within a tenth or two of a percent of whatever the published bank rate is. The only time you’ll see a major difference is if a merchant tries to pull the “dynamic currency conversion” scam on you, in which case you’ll pay a penalty of anywhere from 6 to 10%. No joke, the rate really is that bad. I try to be extra vigilant but it’s easy to get snookered when you’re in a hurry.

    @Elmario The problem is that the spread you outline is exactly the same when using an ATM card to get cash, and usually far worse when exchanging money at a money exchange shop. The bid/ask spread is just how the currency market works. Unless you’re a currency trader and know how to work the system, there is no benefit to using cash, unless the merchant you’re dealing with is willing to give you a substantial discount vs. paying with a card.

  31. The Citi Prestige has become a joke in the “premium” card market and I’m not sure how it makes your “go to” card list. You can get more points on dining with the CSR and you get equal points on travel. Plus the redemption is much better as of this July. The benefits you frequently tout don’t relate to the point accrual but rather the concierge services of the 4th night free benefit.

    With the full impact of the devaluation in July, I hope it moves to a less premier spot. I’ve basically given up on it other than to access Admirals lounges

  32. Since you’re in Europe, I’m a bit surprised you don’t carry around one of the Barclaycard products that have chip & pin.

  33. @ Andy For the past two summers we have tried in vain to use our Barclay cards as chip and pin. Even when we ask the cashier to try to run it that way, it automatically defaults to signing required. 🙁

  34. @Robert Hanson the cards will default to chip & signature, but will “backup” to chip & pin if needed. For example, in a store, they’ll pop-out a signature paper, because this is the preferred transaction. However, in automated ticket machines/ parking machines/ toll kiosks, they’ll work with pin (while strictly chip & signature cards will decline or error out).

  35. This is why you get a First Tech FCU no-fee card (Choice or Platinum) as your travel backup card. It has no foreign transaction fee. It also has true primary Chip+PIN, like a European card, so it works everywhere.

    Of course, it might have killed you a little to use a card that doesn’t earn some kind of rewards, but saving the forex probably makes up for the 1.5X UR you get on the Freedom Unlimited.

  36. Ben,

    This might be where you consider switching to Samsung. With Samsung Pay, not only can you pay with NFC like Android Pay, but you can also use the magnetic function and pay when NFC doesn’t work.

  37. N1120A, I don’t think it would help in this case. Samsung Pay is functionally equivalent to swiping a card — whether via NFC or Loop, it transmits a card number, which the bank knows corresponds to your actual card number. In this case, none of Ben’s cards worked transactionally, so Samsung Pay probably wouldn’t have either. It would only help if the card couldn’t actually be read physically.

  38. Ivan – Except that it works using a virtual card, which would allow AMEX to be accepted.

  39. N1120A – How does that follow? It uses a virtual card number for each card you add — not some magic meta-card. A virtual Amex won’t be any more accepted than a physical one.

    (Btw, if you are trolling, nice work — I ate your bait.)

  40. I have been a steady Chase customer for twenty years plus. Suddenly I find several FOREIGN EXCHANGE RATE ADJUSTMENT FEE s charged to my debit card for some of my travels. There was NO notice of fee changes, just the charges. I travel a lot and the main reason for being a Chase customer was no fees other than ATM charge from another bank. I griped to customer service and a few fees were reversed for me. However the requested explanation for the bank to change policy and now charge me fee was explained as ” most other banks charge this fee now ” . I will shop for most other banks to see what I can find. Is this more banking deregulation ???

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