Originally Posted by
vrbaba
I hate the fee, and just for that reason, I carry the Capital One card for years now.
c_stanley,
However, I did not realize they charge the fee even if the transaction is made in USD. Are you sure if LAN.com didnt actually make the charge in foreign currency but showed it to you in USD? I have recently made several purchases overseas and used my citicard (knowingly for reasons) and have been only assessed the fee when the transaction was in foreign currency. I made a purchase at an international airport where they specifically charged in USD, and I did not get the fee assessed.
Yes I'm really sure about it. It so annoyed me, and I wasn't busy that afternoon, so I spent a lot of time on the phone arguing about it with citi. Something really irked me about paying 3% of a transaction in dollars at an AIRLINE. By definition airlines are all over the place. How on earth can you tell me that an airline who sells me a ticket in US DOLLARS while I'm in the US is a "foreign" transaction.
The supreme irony was that I was talking to one of the service reps, who spoke good clear english, and I just said offhand "You live in the U.S. right, where do you live, is there a big international airport nearby? I bet if you went in there you'd find a lot of LAN employees that could sell an airline ticket." And there was a long silence and a real fumbling and stammering. Then I said wait, you're not in the US are you, are you in India right now. And he paused for a long time and said yes. I complimented his English, that hadn't been the point of my comment, I thought he was American. And I resisted the urge to ask him if I could charge Citibank a foreign transaction fee for connecting me to India when I called a U.S. company for customer service.
But that's beside the point, I wanted to rant about this one. The answer is yes, apparently being charged in USD does not help any more (I don't know if that's old or new news but I think it's brand new as I have had the same experience you have in the past, charging in USD in foreign airports and so on). I think the root of this is that it became more and more common for merchants overseas to offer this, and they usually would convert at a less favorable rate than the interbank rate.
So effectively if a company like Citi allows USD transactions overseas with no fee, they're letting their "rightfully earned" fee for a foreign transaction get sucked up by a creative merchant who keys in the transaction in dollars.
That said, it still irks me. Converting currencies is a service, it requires holding currency and logistics. I can understand paying a fee for that, though I don't like to.
But CC companies also make money on the discount rate. If I'm paying them dollars and they are remitting in dollars, and it's all electronic anyways of course, it seems like a giant scam to me. And certainly cause for me to be much less likely to use Citi AA cards if I have any doubt as to what will be charged.