The February issue of Conde Naste Traveler (the issue is not available on line as yet) has a good reference chart comparing the different bank cards. They even give FT a salute! "The excellent online forum FlyerTalk.com has a thread called "Best Card for Foreign Exchange?" which discusses cash-back cards that allow you to net a profit on purchases abroad. One traveler recommends the MBNA Fidelity Investment Rewards MasterCard: The 1.5 percent cash rebate -- minus the one percent currency-conversion fee -- equals a 0.5 percent profit."

I have the CostCo Amex card which gives a 3% rebate on restaurants and 2% on travel. Those make up the majority of my foreign travel purchases. So on hotels, car rental, etc. I break even (Amex has a 2% vig). On meals I come out ahead by 1%.

You have to bear in mind that the AMEX conversion rate is usually less favorable than MC/Visa, adding about 1%-2% to the amount you have to pay in US dollars.

Dwindling options
 

This is what I got off the online application for the MBNA Fidelity Investment Rewards MasterCard today:

"Effective for accounts opened after April 30, 2006, a Transaction fee equal to 3% of the U.S. Dollar amount of any transaction made outside of the United States, or in a foreign currency. This fee will be in addition to any other applicable fee."

Even if I were to get the account open before April 30, I can't count on there not being a letter coming my way thereafter (like what happened on my other CCs), announcing a take-it-or-leave-it increase in foreign purchase transaction fees.

So, I'm still looking for a card that has some type of Mileage/Air Travel, or Rebate rewards... and that won't hit for more than the 1% transaction fee as soon as the issuing Bank gets the chance.

RE:

ANY bank, MBNA or any other, can introduce this fee anytime it may see fit. To me, the grandfathering of Fidelity cards issued before April 30th looks a very good opportunity for anyone who travels outside of the US. But you could always get the Capitalone card.

How much Bank of America charges for Currency Conversion at ATM withdrawal ?
 

Does it make a difference between the ATM card or a debit card with the logo ? I have Bank of America accounts, they wanted us change to the "Check Cards" and not knowing the difference, we did. I know we can do ATM without ATM fee if using their network. I have not used their card since the Currency Conversion fee shot up on most every bank.

Can I go to a BoA branch to ask for switching the "Check Card" back to a regular ATM card ? Do they charge a fee nowadays to issue a card ? I know some banks actually charge a fee now if you need a replacement card.

BTW, I have a secured e-mail confirmation from BoA regarding the holder's liability on the debit card - essentially it is 0, if you report the fraud within 60 days, Visa also has a 0 liability policy for point of sale transaction that requires a PIN. (or something to that effect) I have saved that e-mail in my file.

wizard
 

in australia, we have the wizard clear mastercard.

1/ no mastercard fees
2/ no wizard fees
3/ no foreign atm fees (except those specifically imposed stated when you do the transactions - ie 7elevens, etc)
4/ no annual fee
5/ no fee!

the exchange rate i get is virtually identical to the spot rate. i love this card.

the saving on the forex fees is so much better than earning miles. i calculated it at just shy of 4%, earning is generally 1 to 1 or 1 to 1.5 in Australia even still, with that saving I could buy a revenue, status generating economy ticket and earn miles rather than saving up the miles for an impossible seat in biz or a mileless award in economy with no status, no miles earned.

I am in Aruba now. Nearly all the restaurants charge in US $ The charges are starting to show on my statement. Obviously no conversion rate. No charge for the transaction. With the 3% cash return on my Amex Costco card, I am ahead of the game. ^

I'm currently "stuck" with 4 different cards, AMEX Blue for Students, Delta Platinum AMEX, Citi Dividend Visa and Mastercard.

In comparing the three, the BEST rate comes from, oddly enough, the Platinum AMEX, 2% built in. Citi decided to change the T+C on me last year and charge me a chunk at the end of the month in foreign fees, not so great at all. AMEX is a 2% fee verus a 3% fee for the Citi cards. I would prefer getting the cash back (5% at gas stations, grocery stores and drug stores and 1% everywhere else) but I only use it at the places that I get 5% back.

A CC Update by The New York Times
 

..........."Consumers will save a lot of money if they think about using the right card when traveling, and think about it in advance," said Jennifer Openshaw, chief executive of Openshaw's Family Financial Network and host of "Winning Advice with Jennifer Openshaw" on ABC Radio. "Using the wrong card can add close to 10 percent to the overall cost of a given purchase," she said. "For example, your bank might charge you 3 percent for a purchase, and the merchant might charge 6 percent to convert the charge to dollars."

The challenge for most people is that even if they have a few cards from Visa or MasterCard, the financial arrangements and charges may differ depending on the issuing bank, said Justin McNaull, a spokesman for AAA in Washington. "The rates you'll pay depend on the card you carry, the bank that issues the card and the merchant's policies. They all can have varying rates, so the actual cost to you is some combination of those three different aspects," Mr. McNaull said. While MasterCard and Visa charge a 1 percent fee for processing foreign purchases, individual banks or other businesses that issue the credit cards can — and often do — impose a surcharge.

"A credit card is still the best way to pay for hotel rooms and big-ticket items," said Ed Perkins, contributing editor to SmarterTravel.com and author of the book "Business Travel When It's Your Money." But, he noted, most banks are now charging a 3 percent surcharge on foreign billings, instead of the 1 percent conversion fee that MasterCard and Visa impose. "The extra 2 percent is a pure gouge, and banks do it because they can get away with it," he said..................... http://www.nytimes.com/2006/02/19/travel/19prac.html

MisterNice

Penfed card - fast turnaround
 

Not to beat a dead horse, but thanks to pgary, I indeed got my penfed card, and was only assessed 1% surcharge on the rate (compared my exchange rate against prevailing historic rate) + 1.25% will be coming back as a cash reward. Thus, net "profit" of .25% on foreign charges.

One thing I will add to the discussion is that the turnaround for the credit card approval was extremely fast. From online registration with penfed.org to receipt of card, it was only 7 days!! My CitiAA and United Visa took at least 3 weeks!

So anyone planning a last minute vacation (like I did) can apply and still have a chance to get the card in time.

Also, as pgary mentioned, it's likely that you have an affiliation to join the penfed credit union. If not, you can pay a nominal one-time fee to join an association (but continuing in the credit union is not contingent on remaining in the association).

http://www.nytimes.com/2006/02/19/travel/19prac.html


The article mentioned above noted that Capitol one is not charging anything for forex transactions, even the 1% Visa/MC bank fee. I can confirm this with a trip I did last month (and the exchange rate used was also pretty competitive). Right now, Capitol One is the best card for overseas travel for me (since I get 1% cashback on all purchases).

Everbank claims to have free ATM withdrawls and no surcharges worldwide...

Interestingly we ran into few places around the World where the merchant ask if we want to charge it in US$ or local currency. We select the US$, if it appears that the equivalent currency calculation is equal or very close.

Did you compare the exchange rate that the merchant applied in making the conversion to US Dollars versus what you expected the credit card company would use? My understanding is that the rates are typically unfavorable -PLUS- your credit card company may still charge a fee for a foreign transaction even if denominated in dollars.

This is exactly the situation referred to in the article above:

"Using the wrong card can add close to 10 percent to the overall cost of a given purchase," she said. "For example, your bank might charge you 3 percent for a purchase, and the merchant might charge 6 percent to convert the charge to dollars."

You should only select to run the charge in US$ if you know that the merchant is giving you a favorable rate. Most of the time, this is not the case.