Transaction Fees Normally Charged On Credit Cards

By Author: Alisdair Cosgrove
Total Articles: 184
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Nearly every major U.S. credit card company, with the possible exception of one, charges a two to three percent foreign transaction fee when you use your credit card internalionally.
Not until lately, have most credit card companies clearly disclosed those fees in their terms and conditions. As a consequence of this, many people received notice of a class action lawsuit settlement regarding these fees earlier this year.

Credit card companies are now being required to clearly state foreign and international transaction charges on credit card applications, since the lawsuit has been settled.

You will most likely be told that your credit card company charges three percent for all international transactions if you get in touch with their customer service to find out. Paying an extra three percent on every purchase is very tough on the wallet, however, there are some ways to avoid paying for these charges.

The foreign currency rate you will receive from your bank may be much better than that of a foreign currency exchange booth.

When a debit card is used as a credit card, there may be some ...
... risks involved, but ATM withdrawals are free of foreign transaction charges as a general rule. A debit card will be easier to use in a fraudulent manner when making purchases abroad than a credit card; this can be the best reason to use a credit card abroad.

If an unscrupulous merchant overcharged or fraudulently used your credit card, you can easily contest the charges and receive a refund on your credit card account. When a debit card is used in a fraudulent manner, it will mean an empty bank account and it will take longer for you 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 pays to know how much you will be spending; this is great for day-to-day life, but it's even more important on vacation, ATM transactions usually call for a small transaction fee to be carried. Very few people have a very good idea how much cash they'll require while traveling; unless you're the exception and have a fairly precise budget, it's difficult to extract the correct amount in a single transaction.

A cash machine can be difficult to find in many countries and you have to be careful to refrain from withdrawing too excessive of an amount to avoid the risk of being robbed. Converting funds back to your local currency also carries fees in addition to the fees you paid to convert to the foreign currency.

Traveler's checks do offer a bit more security than cash does, they can be replaced if lost or stolen, but there is a fee to purchase them and they are not accepted in some places.

If you are applying to get a credit card that will not charge you additional fees for foreign purchases, be sure you understand the terms and conditions of the credit card policy to sure the card you will be getting is the one you thought it was. Before you use the card, check the terms of it to be sure you can pay the balance off fast if the interest rate is high, so you won't be paying extra fees in another 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 interest free credit cards for UK residents and also more information on taking advantage of your credit cards.