Questions and Answers

i’m looking at credit card with no foreign transaction fee and use it in canada (mostly)
– do they use the conversion rate % of the day i purchase anything on that card
– more importantly, do all credit card round off the conversion rate % to their advantage (hidden fee)
– if YES – do you know how much of that percentage the consumer loose

Much depends on the policy of the bank issuing the card. I’ve found these days you are given a choice when you sign to pay in the native currency where you are or USD if its a US bank card.

Hi Chris! Does this post help?

[URL]http://onemileatatime.boardingarea.com/2016/07/07/no-foreign-transaction-fees/[/URL]

From my own personal experience, the forex rate the bank charges me is pretty close to the daily rate i find on xe.com. For me, the difference in rate is pretty much negligible.

My experience with my no foreign transaction fee cards is all positive – the exchange rate tracks with xe.com with no hidden fees. Decline any merchant offer to charge you in US Dollars when in a foreign country – you will pay a lot more.

[USER=1566]@Gia[/USER] interesting you say USD conversions at point of sale are bad exchange rates. I have a currency converter app that uses the current exchange rate and check before making the USD selection. It’s always within pennies.

In my experience, paying in foreign currency and letting the bank handle the exchange rate is much better than the pay with USD option. For example, the equivalent of charging $100 USD, the rate the credit card’s bank gives me is only off by under a dollar whereas the pay with USD option is off by maybe $ but2-$5. Not the end of the world but different enough.

Also, I believe that if you’re using a card with forex fees, even if you select the pay with USD option, you will still be charged a forex fee because the charge took place outside of the US.

Guess I’m outnumbered on the USD option!!

[USER=29]@David W[/USER] – you’re right about forex fees on cards that don’t waive them. Several years ago (before I started “the hobby”) I used my AA card for a hotel in London. Was given the USD option and actually urged to use it. Of course my statement still reflected forex fees which irritated me. But I’m sure the hotel was reaping a few more bucks off that.

I’ve even read anecdotes of people being charged forex fees in other countries where USD is the national currency! That would really grate on my nerves.