Figuring out how you should pay for purchases when traveling abroad can be tricky, assuming a foreign currency is involved. There are many considerations, like how widely accepted credit cards are, how much you anticipate spending, how likely you are to return to that country, etc.
While I don’t think there’s an absolute right strategy of how to go about paying for foreign purchases and exchanging money, I do think there’s a wrong strategy. In this post I wanted to share some general tips for paying for purchases abroad, and then I of course welcome tips anyone else may have.
Below are some of my top recommendations for making purchases abroad as efficiently as possible. In no particular order…
In this post:
Use credit cards with no foreign transaction fees
Whenever possible, I make purchases abroad with credit cards. Admittedly credit card acceptance differs significantly around the globe, though it has come a long way over the years. Why do I pay with credit cards whenever possible?
- There are all kinds of excellent credit cards with no foreign transaction fees, so they allow you to get a fair exchange rate on your purchase
- Paying by credit card gives you great purchase protection (in case you need to dispute a charge), minimizes the risk of cash being stolen, allows you to pay exactly what you owe, etc.
- Credit cards are incredibly rewarding nowadays, especially for purchases that you might make abroad; for example, there are lots of credit cards offering bonus points on dining and travel, which may make up a lot of your spending abroad
As I’ve written about in a separate post, you’ll want to avoid dynamic currency conversion when paying by credit card. In other words, when you pay by credit card and are given the option of making a purchase in your home currency or the local currency, always pay in the local currency. If you choose to pay in your home currency, you’ll typically be charged a huge fee.
Withdraw money from bank ATMs at your destination
I always withdraw some cash in local currency at my destination, even if I’m in a country where credit cards are widely accepted. Cash comes in handy on every trip at some point or another.
I always get cash in the same way — I find an ATM upon arrival at my destination, ideally from a local bank, and I use the ATM card associated with my US checking account. This is both the most convenient and best value option:
- There’s often a fee of a few dollars per ATM transaction, though that pales in comparison to the fees you’d be charged at currency exchange places; furthermore, lots of banks (including my Chase account) reimburse you for these fees
- Assuming you decline dynamic currency conversion, you should get a rate that’s very close to the actual exchange rate between currencies
One challenge can be deciding just how much money you want to convert. After all, you’re typically being charged a fee per transaction, so how do you decide at the beginning of a trip how much cash you should get? Since my bank reimburses me for ATM fees, I usually only take out cash in fairly small increments. This way I don’t end my trip with lots of extra cash, and minimize the risk of cash being stolen.
If you don’t have waived ATM fees, you may prefer to just take out more cash at once.
Exchange money at your local bank before leaving home
Some people feel more comfortable if they can get cash in a foreign currency before even starting their trip. Personally this isn’t something I’ve ever done, and I don’t really get the point of it. ATMs are readily available on arrival, and personally I want to minimize the amount of cash I’m traveling with, since it’s just another thing that can be stolen.
However, if getting cash before your trip puts you at ease, just go to your local bank, and they should be able to get you foreign currency at a reasonable rate. There’s typically a small fee to do this, but then you’ll get the fair conversion rate, rather than some inflated exchange rate.
You’ll want to do this well ahead of your departure, because in some cases the cash may need to be shipped to your bank, so won’t be available immediately.
This is more effort than I’m willing to put in, but to each their own…
Don’t use currency exchange places
Broadly speaking, currency exchange places are massive scams, whether we’re talking about ones at airports or in cities. You see these all over the place, and they allow you to exchange cash in one currency for cash in another currency.
This entire business model essentially relies on consumers not being savvy, since the markup is typically 5-10%, or sometimes even more than that. The marketing around these is also often deceiving. You’ll see that they sometimes advertise “no commission,” but that doesn’t mean you’re getting the fair market exchange rate.
Only use any sort of currency exchange place as an absolute last resort (in other words, if you immediately need cash in local currency, and literally have no other option).
The only exception to this rule is in countries where the official exchange rate is very different than the black market exchange rate. Admittedly that comes with its own risks, but in countries like Argentina, you could come out ahead by exchanging money in more traditional ways.
How to get rid of foreign currency at the end of your trip
What should you do at the end of the trip if you still have some foreign currency remaining? There’s no right or wrong answer, though here’s my general approach:
- If the currency is for a destination I travel to often (for example, if I have Euro), I’ll just keep the cash in my travel wallet, and save it for the next trip
- If the currency is for a destination I don’t travel to often, I might settle part of my hotel bill or expenses on my last day with cash rather than credit card
- One other popular option is that you can generally go to a local Starbucks (if there is one at your destination) and load your foreign currency onto an existing gift card in your home denomination, and it will be exchanged at a pretty fair rate
Bottom line
I have a pretty simply strategy when it comes to paying for purchases abroad. I use a credit card whenever possible, and decline dynamic currency conversion. Then I use a local bank’s ATM to withdraw cash (from my account that waives withdrawal fees), and also decline dynamic currency conversion, if it’s offered.
To the experienced traveler, I’m sure this advice is pretty obvious. However, it always amazes me how many people I see using foreign currency exchange booths, where you typically get a horrible exchange rate. I’m also surprised by how many people accept dynamic currency conversion, throwing money out the window.
What’s your strategy for navigating foreign currency exchange?
I attempted to exchange a little more than €120 Euros at the Charlotte Airport recently after returning from Germany. They wanted nearly 30% on the exchange rate PLUS a nearly $10 usd "fee" per transaction (in my case only 1). I was to give them €121 euros (the exchange rate that day would have been $132 and change), they were going to give me back $80usd......OVER $50 IN FEES! Total scam, kept it for a future trip to the Euro Zone.
Schwab checking account!!! They will reimburse ATM fee from anywhere in the world.
In Vietnam, you will get better exchange rate at jewelry stores for USD. Most will have their daily buy and sell rate posted visibly. But make sure your 50s and 100s bill are as crisp as possible. Or else they won't get the highest rate.
Smaller bills get lower exchange rate.
Except new or like new $2 bills, they are worth as much as $5 before Lunar New Year.
Betterment now offer the same type of checking account as well.
The best card for foreign currency and travel is the debit card issued by Charles Schwab.
I have had it for 10+ years. Any country, any ATM, you get exact the currency and the exact currency value for the day (e.g. if 1 Euro is 1.11 USD, you will get 100 Euros to $111. All charges are levied (if ATM or transaction fees are involved) and put back to your account at the end...
The best card for foreign currency and travel is the debit card issued by Charles Schwab.
I have had it for 10+ years. Any country, any ATM, you get exact the currency and the exact currency value for the day (e.g. if 1 Euro is 1.11 USD, you will get 100 Euros to $111. All charges are levied (if ATM or transaction fees are involved) and put back to your account at the end of the month.
You can also use it as a ATM card at any domestic airport, Walmart, Target, 7/11 etc. in the States. They will refund you the charges at the end of the month.
Go open a Charles Schwab account and get the card now if you haven't already.
The one problem with using your ATM card associated with a bank account that reimburses ATM fees is that there's usually a minimum balance to maintain in that account to avoid fees. So it's packed with money - and if a scammer captures my card details and PIN, they could deplete the account. I prefer to use an account at a different bank where I keep a smaller amount of money. That way if someone...
The one problem with using your ATM card associated with a bank account that reimburses ATM fees is that there's usually a minimum balance to maintain in that account to avoid fees. So it's packed with money - and if a scammer captures my card details and PIN, they could deplete the account. I prefer to use an account at a different bank where I keep a smaller amount of money. That way if someone accesses the account I'm only out no more than $1000 or so. But that account doesn't reimburse atm fees, so I lose a few bucks. Worth it for the peace of mind, IMHO.
@Lucky old enough to see a Traveler's Cheque?
Just returned from Europe (UK and some EU countries) without ever using cash at all or withdrawing from ATM! Only had one case where a vendor wanted cash to buy a water bottle for 1 british pound which I didnt have and when offered USD refused and asked me to just have it for free. Otherwise for a few other instances of tipping hotel bellman who helped with bags I only had USD to tip with!
I can't see how you almost always use some cash on a trip. I almost never use any cash. If you travel to Norway, absolutely everyone prefers card - it's cheaper for the vendor than cash. Fewer and fewer places accept cash here.
The last four times I've been in the UK, I've brought £50, and returned home with the same £50.. no cash used. Hamburg, no cash. Denmark, Norway, Sweden, etc.. no cash. Two...
I can't see how you almost always use some cash on a trip. I almost never use any cash. If you travel to Norway, absolutely everyone prefers card - it's cheaper for the vendor than cash. Fewer and fewer places accept cash here.
The last four times I've been in the UK, I've brought £50, and returned home with the same £50.. no cash used. Hamburg, no cash. Denmark, Norway, Sweden, etc.. no cash. Two weeks in Italy, about €10 in cash. Even in Istanbul and Chicago the last weeks, I've used almost no cash. I just returned from one week in Brussels - no cash used, from high-end restaurant to street vendors and dive bars.
How do you tip people? Like a bell hop at the hotel for examo
I've experienced vendors particularly in India (and even at a 5 star hotel) process my credit card transaction in USD rather than INR without asking me and then on my argument insist that its their "mandatory" policy and/or the selection of USD was automatic (I saw them press the USD button in front of me before I could react!)
Don't sign.
All very good advice that I use often when traveling, however the Starbucks gift card is a new one to me and a great idea, so thanks for that little nugget…
Be careful, though. I once tried to use a Starbucks gift card at a location overseas and they refused it. Not sure if that's changed and their system is now better integrated. Or if it only works in one direction. Or if it doesn't work at all for some foreign locations.
Still doesn't work in some countries.
Finding a bank ATM can sometimes be tricky as they seem to locate non-bank ATMs next to bank branches. What I look for are ATM machines located inside bank lobbies or vestibules. Even if the bank is closed you can usually access the lobby/vestibule by swiping your ATM card on the door.
Also if I have a small amount of local currency left, I typically leave it as part of my tip to room attendants, etc.
In Germany you get a fair exchange rate at your local bank and the fee is nominal. On top of that, they allow you to exchange leftovers from your travel back for free. If your bank offers this it can be an advantage to get it before your travel.
Never, ever get foreign currency from a USA bank in the US. This is the WORST possible exchange rate you will experience. US banks simply don't want to be bothered with foreign currency or foreign money. Get a small amount of cash at the airport upon your arrival in a foreign country.
The 2nd worst places are airport moneychangers. If you need some cash for a taxi or such, limit your exchange to $100...
Never, ever get foreign currency from a USA bank in the US. This is the WORST possible exchange rate you will experience. US banks simply don't want to be bothered with foreign currency or foreign money. Get a small amount of cash at the airport upon your arrival in a foreign country.
The 2nd worst places are airport moneychangers. If you need some cash for a taxi or such, limit your exchange to $100 USD. BTW, ALL moneychangers want brand new, crisp $100 bills. Forget the $50s and $20s. They'll tell you to keep them in your pocket.
My 1st time in Warsaw, Poland last year the airport exchange rate was 3.51 zloty = $1 USD. At the largest moneychanger near the City Centre the next day I got 4.21 zloty.
In the Philippines when you're leaving the NAIA airport in Manila, there are about 6-7 moneychangers just inside the last exit door to the outside, including some banks. I found here the exchange rate was almost the same if not exactly the same as in downtown Manila. Also, in Manila use a moneychanger, not a bank. Banks want your Passport and other ID, and there's a pile of paperwork. The moneychangers will take your money and give you Philippine piso. No questions, no paperwork, no ID needed. And the farther away you are from a large city like Manila or Cebu you'll get a bad exchange rate. The Philippines runs on cash for everything away from the tourist hotels and tourist restaurants.
Prior to 2013 or so, I got my foreign currency pre-trip at Amex travel office with no fee for my card type. Exchange rate was fair. Since many of those offices closed, I switched to using Wells Fargo. Again, no fees with my account type. But then they stopped offering it on-site and now do home delivery only -- with a fee, of course. So now I just do local bank ATM upon arrival.
Whether or not you withdraw cash depends on how long you will be there and depends on how often you will return. It also depends on the currency. If Euros, for example, and you are American it would not likely be a big deal to hold on to, but for some small currency that is not widely known or accepted it may be different. I agree with the idea of using the ATM as usually...
Whether or not you withdraw cash depends on how long you will be there and depends on how often you will return. It also depends on the currency. If Euros, for example, and you are American it would not likely be a big deal to hold on to, but for some small currency that is not widely known or accepted it may be different. I agree with the idea of using the ATM as usually the exchange rate is better than cash and most places have ATMs that accept a visa or mastercard debit card. In some countries though where Dollars are valuable then it could make sense to exchange cash.
Usually the exchange rate is not good if you get cash before you leave. Your comment under the photo is incorrect. Many local banks cannot handle foreign exchange or you may have to make an appointment in advance. The photo shows the Chinese currency Renminbi and there are few places outside of China that can do the exchange and the rates are extremely unfavorable.
For most places I am going I will exchange at the ATM unless in a country such as the ones mentioned where one can get a much more favorable rate for cash. The amount depends on the factors mentioned.
Since the 90's I've used ATM's around the world for local currency. Usually airport ATM's tack on a surcharge and bad exchange rate but most of the time much less costly than trying to exchange at your local bank.
Except for the latest trip to Argentina where I felt it necessary to exchange $200 Cdn into Pesos. Large fee and the "official exchange rate". (Which is approx twice the "real" rate). Money exchange on the...
Since the 90's I've used ATM's around the world for local currency. Usually airport ATM's tack on a surcharge and bad exchange rate but most of the time much less costly than trying to exchange at your local bank.
Except for the latest trip to Argentina where I felt it necessary to exchange $200 Cdn into Pesos. Large fee and the "official exchange rate". (Which is approx twice the "real" rate). Money exchange on the street is legal and no problems. Taxi stand outside the cruise terminal gives a pretty good rate. There is a long pedestrian mall downtown that has what appear to be hundreds of exchange people that give even a better rate.
Credit cards also partake. ALWAYS pay in local currency. Mastercard will then charge your CC the official rate in your home currency and then within a short time give you back about 45% as the blue market rate in a credit transaction. Couldn't figure it out when it first happened in January. Visa, on the other hand, just charges your card in the "blue rate" so you get the discount. AMEX (for all of January, Debruary and March) charged the official rate. No rebate. As soon as I realized the benefit of Visa/Mastercard I stopped using AMEX. This week I received a refund from AMEX for the January purchases adjusting to the "blue rate". I guess irate customers had written angry that the competition was charging half the conversion rate.
Lesson - always charge in local rate. Check out ATM's as they are no longer as reliable as they used to be. Hopefully the web can advise if the official rate is not the real rate.
I wholeheartedly agree about foreign exchange establishments! I'm currently in Koh Samui (Thailand) and all the forex places - they're everywhere - are offering the seriously unattractive rate of €1 = 34.00 THB. As the rate on Google, etc. is around 37.5, that's close to 10%.
These places are not total trainwrecks, however. As my card (Wise) does not reimburse me for foreign bank fees and I also have to pay €0.50 + 1.75% on...
I wholeheartedly agree about foreign exchange establishments! I'm currently in Koh Samui (Thailand) and all the forex places - they're everywhere - are offering the seriously unattractive rate of €1 = 34.00 THB. As the rate on Google, etc. is around 37.5, that's close to 10%.
These places are not total trainwrecks, however. As my card (Wise) does not reimburse me for foreign bank fees and I also have to pay €0.50 + 1.75% on any withdrawal over and above the third, the economics of using of using a forex place are not quite so straightforward. Moreover, they will be useful at the end of the stay for changing back THB into Euros (39 THB to €1).
ATMs in Thailand charge a huge fee that is just incorporated into the amount you withdraw, so your bank can't waive it. For Thailand, bring cash. When you get to BKK, head down to the basement where the train station is and use the exchange counter called Super Rich (other counters around them showed up later and now are offering similar rates). The rate is pretty much the same as what Google tells you and...
ATMs in Thailand charge a huge fee that is just incorporated into the amount you withdraw, so your bank can't waive it. For Thailand, bring cash. When you get to BKK, head down to the basement where the train station is and use the exchange counter called Super Rich (other counters around them showed up later and now are offering similar rates). The rate is pretty much the same as what Google tells you and there's no fees. They have a few locations in the city as well.
I've just paid THB 220 for cash withdrawals. It seems to be a fixed fee so, if you take out a large amount, the percentage is pretty small.
I, too, go to the Super Rich counter en route to the train station to the city at Suvarnabhumi to exchange money. The rates are only a little off the official exchange rate and I do not feel ripped off. Of course, we are talking only about major currencies here. For folks carrying currencies such as INR or THB, you will get short shrift at 'international' money exchange places. Best to buy yen or dollars...
I, too, go to the Super Rich counter en route to the train station to the city at Suvarnabhumi to exchange money. The rates are only a little off the official exchange rate and I do not feel ripped off. Of course, we are talking only about major currencies here. For folks carrying currencies such as INR or THB, you will get short shrift at 'international' money exchange places. Best to buy yen or dollars locally, then, for exchange abroad but you are guaranteed to get shafted. Thems the breaks for people who come from poorer countries.
From my experience:
1) don't convert at your bank at home (at least not at BofA)- they give you a terrible rate
2) be very of careful using ATM's depending on your bank- chase is great if you are a "preferred customer" where they wave the ATM fee. Usually get a very fair exchange rate. BofA will wave ATM fee if you are Platinum customer, but they add a 2-3% exchange fee of...
From my experience:
1) don't convert at your bank at home (at least not at BofA)- they give you a terrible rate
2) be very of careful using ATM's depending on your bank- chase is great if you are a "preferred customer" where they wave the ATM fee. Usually get a very fair exchange rate. BofA will wave ATM fee if you are Platinum customer, but they add a 2-3% exchange fee of what amount you withdraw- total rip off
3) agree with always choosing option of being charged in local currency vs USD with credit card use.
4) although I use my credit as much as possible, you have to have some cash as you need some in instances where you can't use your credit card. In many countries, especially in Africa local craft markets, food stands only take cash.
5) one of exceptions I have found to your advice of avoiding currency exchange on the street is Bangkok, where the rate is almost the same as the official rate and no commission. I rarely, if ever use the currency exchange at the airport as you get a poor rate plus commission added.
They key is to have options. I carry $3K in cash, some local currency, Schwab debit card for ATM and a bunch of no exchange fee CC from Chase and Amex. For a large cash transfers Wise has been excellent but you need a local bank account.
I did notice one comment regarding Travelex and I agree with you. If possible avoid using Travelex because they charge high fees. They are also very sneaky in their approaches. For example; instead of saying that you get $1.10 USD per 1Euro, they will use a larger number (exchange 450 euros to get $460) to confuse you and scam you. If you are traveling to the UK, they are unfortunately, the biggest gig in town
I get foreign currency different ways, depending on the country. In many countries, it's not easy to survive only on U.S. credit cards. I find it comforting to have some US currency, particularly if not in Western Europe, Canada, or Japan.
1. get foreign currency in the US 0- I never do this. The rates are often poor.
2. get foreign currency at the VBCE in Vancouver. Their rates are decent.
3....
I get foreign currency different ways, depending on the country. In many countries, it's not easy to survive only on U.S. credit cards. I find it comforting to have some US currency, particularly if not in Western Europe, Canada, or Japan.
1. get foreign currency in the US 0- I never do this. The rates are often poor.
2. get foreign currency at the VBCE in Vancouver. Their rates are decent.
3. get a small amount of Indian rupees if arriving in India in the middle of the night, which is common. Get it in Canada or Singapore.
4. use banks in Taiwan. The rates seem very close.
5. use some currency exchange places near Victoria Station in London. Decent rates.
6. ATM
7. Know someone who came back and has extra.
It's a pain in the neck when a country's money is no longer legal tender, like Switzerland, Sweden, UK, India, etc. With Switzerland and the UK, you can change it at the central bank in London or Zurich. Singapore and the US has never done this. Old money is still legal tender. That is being reliable.
I currently keep stocks of money for Canada, EU, UK, Singapore, Japan, Korea, Australia.
Biggest downside of ATMs is that you don't get small denomination bills which is what I really want for tipping. That's why I'm generally OK paying a currency exchange fee in order to get small bills at the airport to get me tip money for the driver, hotel check-in, etc. Like others I keep some foreign currencies for future visits (Euro, Canadian Dollar, and Mexican Pesos though only in small denomination bills).
Keep in mind that although Starbucks is global, the Starbucks Card is not and will only work interchangeably in the US, Canada, Puerto Rico, United Kingdom, Ireland, Australia, and Mexico.
In Japan you have to make sure the ATM accepts foreign cards which makes it a slight hassle...
The banks in NRT/HND have fairly reasonable exchange rates to get you started if you need cash on arrival, but the Travelex marks up by upwards of 10-15% at times. I see this on the rates in the US too so I guess it's an airport Travelex thing.
I usually exchange extra at the bank when the forex rate is good and keep the cash since I will end up using it on my next trip.
I have had issues in the past using bank ATM's in Tokyo and could never get a reason why. However, there are plenty of 7 Elevens, and I have not had any issue using the ATM there. I think they charged a couple dollar fee on the exchange, but the rate itself was very good.
Use 7 Eleven ATMs, and also Japan Post ATMs for foreign cards.
I have always received a much better exchange rate at an ATM by declining the local conversion. I do have a no fee card (Schwab) but not sure if that is the fee you mention in regards to "dynamic conversion". I have actually done back to back withdrawals in Puerto Vallarta and compared the rates and fees.
When going to less developed countries, I find it better just to get USD as they are widely accepted as I might not be able to get their currency in my bank at home.
I can see a "Just Use US Dollars In Countries With Janky Foreign Exchange Regimes" coming in OMAATs future!
It's true, USD is so universally accepted to the extent that even terrorists accept it for ransom.
I always get a little cash from an ATM when I land. It always amazes me how many people I see using those scammy currency exchange places, most often there are several ATM machines mere steps away, especially at a major airport.
There are also numerous countries (eg. Nigeria, Malawi) where the official "cash" rate is 40-50% better than the official "electronic" rate. So you will get significantly less money withdrawing $100 equivalent from an ATM than if you had a $100 bill to exchange at a bank or forex dealer. The street exchange rate is even more favourable.
Also, if carrying cash, remember that US $100 bills in series older than 2013 are not usually...
There are also numerous countries (eg. Nigeria, Malawi) where the official "cash" rate is 40-50% better than the official "electronic" rate. So you will get significantly less money withdrawing $100 equivalent from an ATM than if you had a $100 bill to exchange at a bank or forex dealer. The street exchange rate is even more favourable.
Also, if carrying cash, remember that US $100 bills in series older than 2013 are not usually accepted in most parts of the developing world, and in fact are illegal to even possess in some countries (eg. Somalia).
Just curious, why is this 2013 so important? Design Update?
New design with many more counter-counterfeiting attributes
https://www.uscurrency.gov/denominations/100
Yes, new anti-counterfeit measures added in 2013.
Google for the full run down.
This - something no one tells you until it happens to you, so thank you Sean M!
Not just 2013, but also bills need to be clean and in good condition. I had huge issues in Myanmar and Cuba because I had money to exchange and many of my bills were either slightly ripped (barely noticeable) or had some ink/other drawings on them and they would not accept them. Make sure if taking bills out beforehand that they are crisp.
In Zimbabwe, they make a fuss if dollar bills are less than pristine.
Exactly the same in Venezuela
Bank Of America has Global Alliance with many banks, not charging ATM usage fees. they still charge foreign currency fee.
https://locators.bankofamerica.com/international.html
Barclays United Kingdom (England, Scotland, Wales, Northern Ireland, Jersey, Guernsey and the Channel Islands)
BNP Paribas (France)
BNL D'Italia (Italy)
Deutsche Bank (Germany and Spain)
UkrSibbank (Ukraine)
TEB (Turkey)
Scotiabank (Canada, Mexico, Peru, Chile, and the Caribbean countries: The Bahamas, Barbados, Cayman Islands, Dominican Republic, Jamaica, Trinidad &...
Bank Of America has Global Alliance with many banks, not charging ATM usage fees. they still charge foreign currency fee.
https://locators.bankofamerica.com/international.html
Barclays United Kingdom (England, Scotland, Wales, Northern Ireland, Jersey, Guernsey and the Channel Islands)
BNP Paribas (France)
BNL D'Italia (Italy)
Deutsche Bank (Germany and Spain)
UkrSibbank (Ukraine)
TEB (Turkey)
Scotiabank (Canada, Mexico, Peru, Chile, and the Caribbean countries: The Bahamas, Barbados, Cayman Islands, Dominican Republic, Jamaica, Trinidad & Tobago, and Turks & Caicos Islands)
Westpac Bank (Australia and New Zealand)
China Construction Bank (Mainland China, excluding Hong Kong)
Bank of America will assess an international transaction fee of 3% of the converted US dollar amount.Footnote2 Foreign ATM operators may offer to do your currency conversion for you, but they may charge a higher fee for conversion. To insure that your currency conversion does not incur a fee higher than 3%, you may refuse the ATM operator's offer to convert the amount of the transaction.
Thank you, @anonymous
I was prepared to offer an identical comment, but you kindly saved me the trouble.
Interestingly, the only time I have experienced an issue with this alliance, has been in the USA. There are still one or two states in the USA that do not have a Bank of America ATM presence. Solved by using a debit card for hotel stays and a Chase ATM with a small fee. But over...
Thank you, @anonymous
I was prepared to offer an identical comment, but you kindly saved me the trouble.
Interestingly, the only time I have experienced an issue with this alliance, has been in the USA. There are still one or two states in the USA that do not have a Bank of America ATM presence. Solved by using a debit card for hotel stays and a Chase ATM with a small fee. But over 20 years of international travel, I've never experienced a problem in the majority of the world's continents.
The US is pretty unique in the structure of its banking system: none of the big banks is yet truly nationwide. All of them have large metro areas where they have basically no presence on the ground.
One tip... at least in Europe use ATMs from banks and as a tourist at all cost avoid Euronet ATMs and always decline dynamic conversion. Actually, problematic are not only Euronet ATMs but all ATMs where only ATM is written on them (without a bank). They charge extra fee (besides usual fee that your bank charges, from 3 to 10 EUR extra on transaction!) and their dynamic conversion rate is as bad as it gets....
One tip... at least in Europe use ATMs from banks and as a tourist at all cost avoid Euronet ATMs and always decline dynamic conversion. Actually, problematic are not only Euronet ATMs but all ATMs where only ATM is written on them (without a bank). They charge extra fee (besides usual fee that your bank charges, from 3 to 10 EUR extra on transaction!) and their dynamic conversion rate is as bad as it gets. Unfortunately, now in Europe some bank ATMs also charge extra fee. However, at least in the EU an ATM has to inform you that it will be charging extra fee. If it does, cancel and find a new one. Problem is that those "chain" ATMs (like Euronet) give advantages to local businesses and in some countries they are taking over the most popular spots...
Also note, that sometimes locals are not aware of those extra fees as they are only charged on non-local banks.
This is a HUGELY important point! Euronet and some others really rip you off, they look like official bank ATMs but they are not. I've also found that in many European airports you only have these shady non-bank ATMs and its better to try to wait until you get to the city for a good bank ATM if you can.
My Credit Union refunds up to $20 per statement cycle on ATM fees however I pay a 1% fee on cash withdrawals. Since my cash withdrawals are never more than €200 per EU trip, the €2 isn’t a big deal. Thankfully you can pay for just about everything on credit cards in EU countries that I transit.
Well, I guess that most comments here are American ones. As a European traveling all over the world for business purposes, I always get some ATM money at the arrival airport, just in case of. Whenever I can avoid to use it I will. I use Debit cards at ATM, never Credit, which are much more expensive than Debit. But in Europe you have to ask your bank to deblock your Debit card for use...
Well, I guess that most comments here are American ones. As a European traveling all over the world for business purposes, I always get some ATM money at the arrival airport, just in case of. Whenever I can avoid to use it I will. I use Debit cards at ATM, never Credit, which are much more expensive than Debit. But in Europe you have to ask your bank to deblock your Debit card for use outside of EU.
If the money isn't used I do like Ben, clean my wallet at check out of the hotel. Even if I know next week I will be there again -of course depending on the destination. I have the experience that some countries don't like it very much to see you exporting their currency, especialy African countries.
Also in many cases don't wait to spend the money at the taxfree shops in airports, surely not worldwide but I know in Brazil at Duty Free they don't accept their own currency. Only Dollars, Euro's or Credit Cards.
I tend to do this as well if a hotel and not a rental.
ATMs in Thailand charge exorbitant fees for accessing foreign bank accounts; I have found over many trips that you can get a better deal by bringing cash and doing careful perusal of the forex places on the ground if you're in a heavily touristed area.
Some foreign ATMs have machines where it takes the card and ejects it rather than inserting it in and out which can be a pain. So now even at home, I use ATMs that have contactless readers where I can just use my phone and leave the actual card at home. As for excess notes, I have a collection of notes in a Ziploc.
Note to people to be careful with contactless ATMs. Some do not actively end the session after a transaction and it's easier to walk away when you're not waiting for card return. Always remember to wait to ensure the ATM returns to new customer prompt.
My bank asks if I want to do anything else before the transaction ends. And if you want to conduct a new transaction, it always asks for the pin. But yes, always make sure the transaction ends. It's always a good a idea to check your accounts every now and then at the very least. And I rather have one less physical card on my person. All I have in my wallet is my driver's...
My bank asks if I want to do anything else before the transaction ends. And if you want to conduct a new transaction, it always asks for the pin. But yes, always make sure the transaction ends. It's always a good a idea to check your accounts every now and then at the very least. And I rather have one less physical card on my person. All I have in my wallet is my driver's license, transit card, and one credit (not debit) card just in case the business does not accept contactless payments.
I disagree that all currency exchange offices are a scam. In Southeast Asia, Istanbul, the former USSR, and parts of Eastern Europe currency exchange can be a pretty big business. It's not uncommon to see buy/sell spreads of less than 1%, and as long as you're not in a country that uses a hard currency, commissions are rare.
The real tip for US travelers is to bring 50s and 100s. Some places, like Bangkok for...
I disagree that all currency exchange offices are a scam. In Southeast Asia, Istanbul, the former USSR, and parts of Eastern Europe currency exchange can be a pretty big business. It's not uncommon to see buy/sell spreads of less than 1%, and as long as you're not in a country that uses a hard currency, commissions are rare.
The real tip for US travelers is to bring 50s and 100s. Some places, like Bangkok for example (Superrich) will give great rates on all kinds of currency (USD, CAD, NOK, CHF, EUR, JPY, CNY). Using an ATM certainly is easy, but there are lots of places on Earth where currency exchange still makes sense and isn't a bad deal at all.
I'll second this with large notes. I was Zanzibar not long ago and the rates offered for large denomination notes were about 10-15% better than small ones.
I'm sure it's nothing at all to do with it being easier to smuggle cash in large notes.....
One thing to be aware of with taking cash from local ATM's upon arrival is your bank not approving the transaction, so best to travel with a couple of debit cards just in case. This is much less of an issue nowadays, since most banks don't require you to put in travel notices ahead of time, but still something to think about. I've only ever had this issue at more off-the-beaten path locations, particularly in...
One thing to be aware of with taking cash from local ATM's upon arrival is your bank not approving the transaction, so best to travel with a couple of debit cards just in case. This is much less of an issue nowadays, since most banks don't require you to put in travel notices ahead of time, but still something to think about. I've only ever had this issue at more off-the-beaten path locations, particularly in Africa and South America. Having to call Schwab or Chase from Togo and Paraguay was not time well spent...
Second this. Over a decade ago I was traveling internationally and my ATM card decided to stop working because they suspected fraud. It was a huge hassle to get it resolved and I had to rely on my traveling companions to float me cash. Since then I tend to like having at least some cash on hand before traveling to a country that prefers cash transactions.
Not sure about other banks but Bank Of America lets you set the countries you’ll be visiting in their app, so you don’t even have to call anymore. Very convenient.
While there are exchange offices that can be regarded as outright scams, there are many destinations, particularly in the Middle East and Asia, where exchange offices give an excellent rate. Actually so good that whenever I go to HKG, SIN, BKK, DXB I take the opportunity to exchange my Euros into whatever currencies I know I will be needing for upcoming trips. I save hundreds of euros that way, compared to rates back home.
In...
While there are exchange offices that can be regarded as outright scams, there are many destinations, particularly in the Middle East and Asia, where exchange offices give an excellent rate. Actually so good that whenever I go to HKG, SIN, BKK, DXB I take the opportunity to exchange my Euros into whatever currencies I know I will be needing for upcoming trips. I save hundreds of euros that way, compared to rates back home.
In general, countries with strong currencies have bad rates and countries with weak currencies have good rates. So if you need to change your EUR into THB, do it in Thailand, but if you need to change your EUR into USD, do it in Europe.
Congratulations on discovering the Hawala. These shops are fronts for underground cash transfers so they will give you a great rate to get more volume to hide their operations. Plus, they have almost scrupulous honesty and excellent safety to make sure their real clients don't get spooked. I represent the some US banks here in Vegas and we were discussing the know your customer rules with some casino execs. They were like in the US...
Congratulations on discovering the Hawala. These shops are fronts for underground cash transfers so they will give you a great rate to get more volume to hide their operations. Plus, they have almost scrupulous honesty and excellent safety to make sure their real clients don't get spooked. I represent the some US banks here in Vegas and we were discussing the know your customer rules with some casino execs. They were like in the US they only take wire transfers from a known account in the customer's name. In SE Asia if it comes from a certified foreign exchange office and they can verify the customer actually has a legitimate business, they don't ask how the money got from the business to the cage.
Bank of America app lets you order it easily and it usually arrives in 2 to 3 days at your home. The fee is usually like $7.50 for whatever amount you choose. Super easy and has been my go to for a long time.
Why would you pay $7 and have to wait a few days instead of just getting it in-country from an ATM?
Sometimes ATMs are out of cash or not working
I find it that ATMs in the UK are much less scammy than other Europe countries, as far as I know. I usually go to the Tesco ATM when I needed some cash while in England.
No fees.
Even a bit sketchy ATMs only charge 50p or less than a pound. Very fair.
my experience in the Persian Gulf is that the exchange houses (outside of airports) get you a pretty good deal. walk in, deal with a human, get your money, and walk out.
I don't think this advice is really accurate these days:
- retail banks frequently give horrible exchange rates (factoring in fees) because they don't do the volume
- currency exchange booths can be good or bad. There is no general rule - you need to do the maths at the specific location. It's not right to say they're all rip offs. And you can get quite good rates (sometimes) by ordering online in...
I don't think this advice is really accurate these days:
- retail banks frequently give horrible exchange rates (factoring in fees) because they don't do the volume
- currency exchange booths can be good or bad. There is no general rule - you need to do the maths at the specific location. It's not right to say they're all rip offs. And you can get quite good rates (sometimes) by ordering online in advance and picking up at the booth. This is true at Heathrow for example. Some booths offer very good rates because they are money launderers and not looking to make money on your transaction!
- ATMs are getting more and more opaque. Your home bank may not add a fee, but the ATM can add a fee. It is becoming more and more common to find a fee added at the final step for using the machine, and my experience is that this can end up being 5%. It varies from bank to bank, but unless you know the specific market well, you will waste time schlepping around to find a machine that doesn't do it.
- dynamic conversion advice is absolutely right.
Ideally carry as little cash as possible, but I struggle to get through even $100 in a fortnight in a modern city. Why worry about even 10% compared to the efficiency of the trip.
Getting a bank account that repays ATM fees (Schwab, etc) negates that whole issue.
I never use ATMs which charge a fee, unless it's an emergency. First of all, I try to avoid cash at all, which is mostly possible these days, but even if I visit a cash society (Germany, I'm looking at you), I always find an ATM which is free of charge - not that I mind a small fee, but I don't want to support banks getting away with these new charges which were unheard...
I never use ATMs which charge a fee, unless it's an emergency. First of all, I try to avoid cash at all, which is mostly possible these days, but even if I visit a cash society (Germany, I'm looking at you), I always find an ATM which is free of charge - not that I mind a small fee, but I don't want to support banks getting away with these new charges which were unheard of (at least in Europe) until recently. Banks which offer "free" withdrawals from their ATMs still get reimbursed and should be supported.
You don't mention the importance of finding a home bank that does not add (or markup) foreign exchange fees on foreign ATM withdrawals. This is frequently associated with premium checking accounts like Chase Private Banking or Citibank Citigold, but you also get this benefit (and reimbursed ATM fees) from Charles Schwab Bank checking accounts (which are free), and probably a number of other banks as well.
Having both an ATM card and a credit...
You don't mention the importance of finding a home bank that does not add (or markup) foreign exchange fees on foreign ATM withdrawals. This is frequently associated with premium checking accounts like Chase Private Banking or Citibank Citigold, but you also get this benefit (and reimbursed ATM fees) from Charles Schwab Bank checking accounts (which are free), and probably a number of other banks as well.
Having both an ATM card and a credit card that don't add foreign exchange fees is ideal.
I like to buy at least $100 in foreign currency from my local bank before my trip. Even though it is a bad exchange I end up paying $100 for $91 worth of currency.
This does two things ; it adds excitement to the anticipation of my trip and if I just want to pick up n go and grab a taxi or metro upon arrival.
I left the AA mile up card...
I like to buy at least $100 in foreign currency from my local bank before my trip. Even though it is a bad exchange I end up paying $100 for $91 worth of currency.
This does two things ; it adds excitement to the anticipation of my trip and if I just want to pick up n go and grab a taxi or metro upon arrival.
I left the AA mile up card at home and am using AA Citiaadvantage to avoid foreign fees.
I have an upcoming trip to Mumbai and was unable to get currency ahead of time as Chase does not exchange Indian rupees. I fell like I’ll end up paying $400 for $350 worth of rupees upon arrival at the airport.
Any suggestions? Bank ATM ?
You'll have no issues whatsoever using an ATM on arrival at BOM.
There are nearly 20 different bank ATMs at BOM T2 international arrivals. You literally can't miss them starting as soon as you exit customs!
Interesting article Ben : I have been in both Sweden and Australia for significant periods of time. In both countries I have never found it necessary to exchange money to the local one. Sweden, there are places that do not even accept CASH. Travellers planning on coming to Sweden this summer should do some serious home work regarding how to make purchases etc. Australia falls in between the States and Sweden. I use a combination of US bank cards and local banks.
"However, if getting cash before your trip puts you at ease, just go to your local bank, and they should be able to get you foreign currency at a reasonable rate."
The fact that you've admittedly never done this is betrayed by two things in that statement.
Good luck finding a "local (US) bank" that does currency exchange in 2023. And once you find that needle in a haystack, I doubt the rate will be...
"However, if getting cash before your trip puts you at ease, just go to your local bank, and they should be able to get you foreign currency at a reasonable rate."
The fact that you've admittedly never done this is betrayed by two things in that statement.
Good luck finding a "local (US) bank" that does currency exchange in 2023. And once you find that needle in a haystack, I doubt the rate will be good.
If you need paper currency in your pocket, just use a bank ATM at the arriving airport.
My preferred method of getting rid of currency I won't ever need again is alcohol consumption, but your mileage may vary on that.
@Never In Doubt
Is using an ATM a good method ? Never tried and am paranoid my pin won’t work or something.
I’ve used ATM’s all over the world and never had an issue with my PIN not working.
Have I had an ATM just not work for me?
Yes. After arriving on the train from Hong Kong to Shenzhen in 2019, I had to hit multiple banks before I found an ATM that worked, but that was the last time in recent memory that's happened to me.
Make sure your PIN is only 4 digits - it might not work internationally if it is more than 4 digits.
There was a period decades ago when I was doing a lot of business trips to Italy. One day I decided to try to do the ATM thing for the first time. It was a no go. Later that day I checked out of my Hotel and they could not process my credit card. Ultimately they saved my info and allowed me to depart. Later I found out that some major communications link had failed...
There was a period decades ago when I was doing a lot of business trips to Italy. One day I decided to try to do the ATM thing for the first time. It was a no go. Later that day I checked out of my Hotel and they could not process my credit card. Ultimately they saved my info and allowed me to depart. Later I found out that some major communications link had failed that day and credit cards and bank cards were generally not working.
The upshot, things happen, be prepared.
Except in Argentina. You get 2x as much money when you exchange it in an exchange office outside the airport due to "blue dollar" rate.
@ Lukas -- Hah, excellent point. Let me add that caveat.
Hack for long term visitors to Argentina (where you don't have an ongoing supply of paper USD or EUR), is to transfer money to yourself via Western Union. They'll then give you pesos at the blue rate.
Thanks! That's an excellent idea and can be done if traveling to other countries that have money exchange issues like Argentina.
Agree with Lukas and Never in Doubt. However be careful when exchanging in the 'blue' market. The two more common scams I hear of are:
- getting fake pesos (though pesos by definition are pretty fake already); and
- place creating a distraction, take a bill/ bills off your US$ pile and tell you brought less than what you originally stated. You can protect by counting yourself before handing money over and not...
Agree with Lukas and Never in Doubt. However be careful when exchanging in the 'blue' market. The two more common scams I hear of are:
- getting fake pesos (though pesos by definition are pretty fake already); and
- place creating a distraction, take a bill/ bills off your US$ pile and tell you brought less than what you originally stated. You can protect by counting yourself before handing money over and not taking your eyes off. Alternatively perhaps your hotel or someone local can help you.
Julian,
At Western Union, in my scenario above you know how much you paid in advance (you either transferred it from your bank or credit card).
And while I can't vouch for every WU clerk giving you the right amount of money, "count your cash before leaving the counter" applies here, and everywhere.
Please google also MEP rate for (foreign) VISA/Master card transactions. It is almost the same as "blue dollar" but with the convenience using credit dard
Lukas, you beat me to that. I normally use ATMs but in Argentina the exchange offices (found downtown in even many smaller cities) were indeed offering a much better rate. Moral: if you are visiting a country in economic turmoil, bringing USD or EUR cash could save you a lot.
Get a Charles Schwab checking account; they refund all foreign ATM fees.
Both Bank Fees and Currency Conversion Fees seem to sometimes be charged by both the ATM Network and your Bank.
Both Charles Schwab checking and Chase Sapphire checking accounts offer free ATM withdrawls in local currency. I haven't actually used Chas Schwab - but the Chase Sapphire account re-imburses all fees charged (and you get a good exchange rate - virtually anywhere). You get a Visa Debit Card - and don't have to spend...
Both Bank Fees and Currency Conversion Fees seem to sometimes be charged by both the ATM Network and your Bank.
Both Charles Schwab checking and Chase Sapphire checking accounts offer free ATM withdrawls in local currency. I haven't actually used Chas Schwab - but the Chase Sapphire account re-imburses all fees charged (and you get a good exchange rate - virtually anywhere). You get a Visa Debit Card - and don't have to spend time looking for a "plus system" ATM while in a foreign country. There is a minimum balance of $75,000 required in linked accounts, or you are charged $25 a month for Sapphire Account. Those T-Bills earning 5% in a linked account do count.
Schwab works the same way - fair exchange rate, no fees, ATM fees reimbursed, Visa debit card valid at any ATM. The big difference... no minimum balance, no monthly fees.