|
Understanding International Credit Card Charges |
|
|
|
|
Written by Webmaster
|
|
Thursday, 02 October 2008 |
By Alisdair Cosgrove
 Every major U.S. credit card company, with the exception of one, charges a two to three percent foreign transaction fee when you use your credit card abroad. Before this particular time many credit card companies did not clearly explain these fees in their terms and conditions.
Many people received a notice of a class action lawsuit settlement regarding these fees earlier this year.As the lawsuit has now been settled credit card companies are required to state in very clear terms what their foreign and international transaction fees are.
If you want to know how much your credit card company charges for international transactions you should contact the customer service and you will probably be told that the fee is three percent. It can end up being quite expensive to pay an extra three percent on every purchase, but you can find away to avoid these charges.
The foreign currency rate you'll get from your bank is often significantly better than what you would get at a foreign currency exchange booth.
Foreign transaction charges are generally not on ATM withdrawals, although using a debit card as a credit card has some risks. A credit card is easier to protect against fraud than a debit when making purchases abroad, so this is why it would be better to use a credit card abroad. When there are fraudulent charges and overcharges made on your credit card you can contest them a receive a refund. When a debit card is used in a fraudulent manner, it will mean an empty bank account and it will take longer to see any refunds on the stolen funds.
The only way to pay no international transaction fees seems to be to use a credit card that does not charge these fees and with these no fee credit cards you get the security provided by a credit card without added expenses.
It is important to know how much you will spend; this is good in everyday living, but it is more important when you are on vacation. Most people do not have a very good idea of how much cash is required while traveling and unless you are the exception to this and have a precise budget figured out, it is difficult to withdraw the correct amount in one singlr transaction. Sometimes it is hard to find a cash machine in many countries, so you have to be careful to not withdraw too large an amount to keep from being robbed. You have to pay fees to convert to foreign currency and then you also have to pay fees to convert back to your local currency.
Traveler's checks are a safe alternative to cash but they are not accepted everywhere and there is a fee to purchase them.
Make sure you know what the terms and conditions are on a credit card you apply for thinking that it charges no additional fees for foreign purchases. Check the terms of the card before using it and be sure you can pay off the balance in a hurry if the interest rate is high so you won't be paying fees in a different way.
Alisdair Cosgrove has been writing finance articles for many years and can find more of his work at the UK site CreditCardsWeb.co.uk, offering low rate credit cards for UK residents and also a great selection of interest free credit cards. Visit today to read more of Alisdair's great credit card articles including getting more from rewards
|
|
Last Updated ( Thursday, 02 October 2008 )
|
