I decided to do a mini-experiment with foreign exchange using VISA and Diners Club in Brasil. The VISA is issued by MBNA, which claims to charge only the 1% fee imposed by VISA itself and no further charge. Diners claims a 2% charge on non-US dollar charges. The wholesale exchange rate published in the newspapers for that day was R$ 2.94 to US$ 1.00. The retail tourist rate for cash was R$2.80, or up to R$2.83 for around US$2,000 and perhaps more for higher amounts (no explicit added fee). Here are the results on the credit cards:

MBNA VISA: 2.910
Diners Club: 2.878

The MBNA VISA rate is exactly �1.02% below the published wholesale rate; the Diners rate is �2.109 below published wholesale. The best of the tourist rates for cash offered to me was �3.741 below wholesale.

The MBNA VISA (Motley Fool) has no annual fee and provides a 1% rebate on the total dollar amount; Diners has a $95 annual fee ($35 for additional cards) and an extensive reward program.

I recently did a similar experiment while waiting for a flight at Rome. I made two purchases within 5 minutes of each other at the same airport merchant...one purchase was charged to an American Express, the other to an MBNA Quantum MasterCard.

Wholesale exchange rate for 12/7/03 (source=oanda.com), $1 = 0.82 Euros

Amex Charge was 46.60 Euros
Amex billed me $57.96.
Effective exchange rate $1 = 0.80 Euros
Amex surcharge = 2% (0.82 / (46.6 / 57.96))

MBNA MC Charge 5.10 Euros
MBNA billed me $6.29.
Effective exchange rate $1 = 0.81 Euros
MBNA MC surcharge = 1.1% (0.82 / (5.1 / 6.29))

[This message has been edited by anthonyanthony (edited Dec 15, 2003).]