What Is The Best Credit Card To Use In Foreign Countries?

In the past when I traveled overseas I almost always tried to use cash to pay for things whenever possible. There was always the potential for fraud and theft, and unfortunately there still is. But what really made me weary were the occasional insane credit card fees. When those situations came up where I had no choice but to whip out the plastic, I would begrudgingly do so and mentally prepare myself for the financial beating that would almost always ensue. Years ago I was pretty much solely a Bank of America customer, using the credit card they issued me as well as my ATM card that I had with them.

Well, after one of my trips to Peru I got my monthly statements for my credit card and checking accounts, dreading what the damage was going to be. I don’t recall the exact numbers, but I do remember being completely astounded as to the degree that Bank of America was seemingly able to legally fleece me. Quite frankly it really pissed me off, so I started looking around for less financially painful options for accessing and using my money overseas.

The informational power of the internet let me find out what I was looking for fairly easily. Almost unanimously the various stories I read indicated that Capital One was the best bank for saving money on international transaction fees. At the time that I discovered Capital One and got an account with them they didn’t charge any fees at all to use their ATM cards or credit cards with foreign vendors. Just recently they did start charging $1.50 per foreign ATM transaction, but they are still pretty much the best bank to use as far as I can tell.

If you want to see how the various banks and credit card companies stack up against each other check out this section on debit cards and credit cards on FlyerGuide.com. It has loads of helpful information on using debit and credit cards overseas, and it includes a listing of all the fee structures of the various financial institutions. Unsurprisingly my old nemesis, Bank of America, is one of the worst! If you are lucky enough to have easy access to one of their partner banks, they are fine. But if not, they really stick it to you with their fees. See how your credit and ATM cards fare, and if you think you are getting robbed then switch over to Capital One or one of the other institutions that doesn’t abuse their customers.

If you do want to switch to Capital One be sure to sign up for their miles rewards credit card. It’s not the absolute best mileage program out there, but it is pretty decent. And don’t blindly think to yourself that you should automatically use another credit card that you have just because it is part of a really good points program. If you are getting slaughtered on the backend with international transactions fees, then you aren’t really gaining anything – you might even be losing money in the big picture.

Oh, and one last thing. Foreign transactions can take place from home too – for example, if you purchase airline tickets directly from a foreign airline or if you pay for an international hotel or car booking from home. With my Bank of America credit card there would be a 3% fee for these transactions, and if I were to use my American Express card it would cost me an extra 2.7%. But there wouldn’t be any fees at all if I were to use my Capital One card. Hmmm, which one would you use?

May your travels go well!


About Keith Hajovsky

Since 1985 I have traveled throughout much of the United States and to over forty different countries within five continents for both business and pleasure. As my friends and family will tell you, I love to travel and I love to help others travel. If you are looking for someone to help you out with your travel plans or if you need a personal guide, please let me know!

2 Responses to “What Is The Best Credit Card To Use In Foreign Countries?”

  1. Lorie August 18, 2010 12:35 am #

    You are so right! I quit using my B of A ATM overseas last trip and now only use my credit union’s card. Huge difference, huge savings. They charge a flat fee ($1.50 sounds about right) no matter how much you withdraw. I take out the max and store what I don’t need for the day in the hotel room safe. Good plan!

  2. Keith Hajovsky August 18, 2010 10:21 am #

    Yes, I would MUCH rather spend that money on something else on my trip or whatever. And when it comes to credit card fees it especially bums me out to pay any extra fees. They are already making a chunk off of the merchant, so why the heck should they get yet MORE money out of us?? Seems like legalized robbery to me!

Leave a Reply