MichaelJapan

So I've been living in Japan for quite a few years and find it much more convenient to use Japanese cards instead of cards from back home (which I still keep open and use sporadically to maintain my credit score).

Anyway, I have yet to come across a card without forex fees. I currently have two AmEx cards (Sky Premier and *wood - used to have Delta, but I cancelled it) but they both have 2% fee. My other cards (various co-branded SMBC, Citi & MUFG) usually have a 3% fee.

Apparently, even Platinum AmEx has forex fees in Japan.

This information isn't readily available as it is in the States and you have to call and ask - and sometimes they don't even know what you're talking about.
So perhaps some of you guys can point me in the right direction or just say forget about it.

Any input much appreciated!

armagebedar

My SMBC card has no fee, but the exchange rate is usually a point or two off the market rate.

joejones

My understanding is that every Japanese credit card has about 2% baked into the foreign exchange rate as a foreign currency fee.

Citibank currently offers a dollar-denominated Visa card in Japan, although I have no idea whether the to-be-determined buyer of their Japan retail operation will keep that product going.

MichaelJapan

Thank you. Guess you're right - it is the exchange rate that is slightly off the market rate and fees are incorporated into it. However when I called AmEx and other banks they referred to it as a foreign transaction fee - that's why I used the term.
Guess my question should read are there any cards using the market exchange rate but it seems highly unlikely.

I found this http://creditcard.e-ocean.biz/info/charge.html but I don't know if I can trust the chart (Citi told me 3% on the phone) so I really don't know.
I've heard about Citi's USD card but I can't find it in their current line-up here http://www.citibank.co.jp/ccsi/ja/cardlineup/index.html

joejones

Yeah, it's officially called a 為替手数料 but you don't "see" it on your statement unless you do the math and compare to bank rates. (In comparison to American cards' fees, which are usually a separate line item on the statement.)

It's one of the links toward the bottom of the page.

http://www.citibank.co.jp/ccsi/ja/ca...ollarcard.html

MichaelJapan

Much appreciated!

armagebedar

Do American "no-fee" cards use the market rate? I always assumed there was some commission baked into the rate being used.

Steve M

I think that all US-issued credit cards list the forex fees separately (at least MasterCard, Visa, and Amex) due to previous class-action lawsuit settlements and possibly recent regulatory changes. They get listed separately on the statement as a service charge, much as an annual fee does.

Yes. Because of the above, the actual market forex fee is used, and if there's any "vig" added, it's listed separately. So, a 0% forex fee credit card really is 0%. They are becoming more popular. It's not a bad way for Americans that live abroad that still have some income or assets in USD to spend it in the country they live: use the credit card locally in the local currency, which gets converted to USD at no charge, and then use USD to pay off the card. Voila: conversion of money into local currency with no forex fee.

marikoeggplant

I haven't checked in a while, but I always take a Capital One credit card to Japan with me, since they don't (or they didn't, anyway) charge foreign exchange fees.

MichaelJapan

Yes, but if you generate both income and expenditure in Japan (JPY) and also take into account that there are still merchants not accepting foreign plastic here (they will gladly take Japan-issued cards though) then it doesn't make too much sense to use foreign cards if you live here. Since AmEx Sky Premier gets me 5 points for every ¥100 (93 cents) spent on travel and other cards also help, I'm OK with this for domestic use.
I'm more concerned with travel to other Asian countries, Australia or Europe - I was hoping to find something, but for now I use cards without FX fees from the States.

joejones

Like who? I didn't know there was a difference when dealing with merchants. ATMs, yes...

MichaelJapan

Outside of the main areas probably about 30-40% of smaller retailers. Drugstore chains (ひまわり and ダイレックス being the largest around here) and small food chains. So MANY gas stations - especially ENEOS.
I know of two entire shopping complexes that include Starbucks and other "western" stores and cafes - one in Hiroshima and one in Okayama, that do not accept foreign cards.
The biggest chain not accepting foreign cards is definitely 7-Eleven (weird considering their ATMs accept them for cash advance) followed by Daily Yamazaki. There are many many more.

It was probably one of the first things I've noticed when I first arrived in Japan.
Credit card processing companies offer merchants an option of accepting only Japanese credit cards (cheaper) or ALL (more expensive).

Times are changing and more and more merchants accept foreign cards, but there's still a long way to go.

joejones

That's interesting. I have noticed that my Japanese credit cards don't offer an obvious way to dispute charges. That lack of consumer protection by the Japanese issuers may be one reason why processing vendors charge more to accept foreign CCs.

armagebedar

It's not obvious, but you can perform a 支払い停止の抗弁 to the card issuer, who then will investigate and reverse the charges as necessary. In my experience, when fraudulent charges appeared on my statement, I contacted the card issuer and they immediately reversed the charges. In one case I had to sign an affidavit acknowledging that the charges were fraudulent.

I don't know if the process is as smooth if the dispute is not as clear-cut (e.g. services not performed or provided as agreed).

acregal

I'm actually surprised that the Visa and Mastercard contracts allow processors to refuse foreign issued cards.