Credit cards with 0% international transaction fees

Shopping on international ecommerce sites can cost you

Are you addicted to buying on Amazon, ASOS or Ebay? Well, you’re certainly not alone,  57% of online shoppers make purchases from overseas retailers.

China is the most popular global ecommerce destination for Australians, followed by the USA and the UK.

See yourself in this statistic? Beware that if you’re regularly spending overseas, most credit cards charge a fee of 2–3% of each international transaction, which can soon add up!

Visa and Mastercard charge a fee for each transaction made with foreign merchants as well as the card-issuing banks, and Amex are known to charge more than most.

It’s a good idea to think about exchange rates too. If you’re using an Aussie card to pay on a US website for example, you’ll be charged in AUD which might work out more expensive based on the current exchange rate.

How to spend on your holibobs

Love to travel? If you have a serious case of wanderlust a zero fee international card can save you a bunch. Say you spend $3,000 on your Spanish holiday, you’re looking at almost $100 bucks in fees for your overseas spending. That’s muy costoso!

• You can also find other perks like complimentary travel insurance, lounge passes and frequent flyer miles with these cards.
• When spending overseas, if you’re given the option, always choose to pay in the local currency as you’ll generally end up better off.
• Of course, credit cards are not your only option of spending when you’re abroad.
• If you’re getting cash from an ATM you’ll have to pay a withdrawal fee to the ATM operator and to your credit card, so bear this in mind.
• Prepaid travel cards can also be a convenient way for you to spend overseas with pre-loaded money put onto the card at a set rate without incurring any fees.

How to compare

 It’s smart to compare a range of features when comparing credit cards to make sure you’re getting a good overview of the whole market and see what’s available to you.

And if you can throw in a bunch of extras in the process, then win win! Here’s some other stuff to consider when comparing credit cards with 0% foreign transaction fees.

ATM fees:
Using a credit card to get cash out in Australia will incur a fee, and even more if you’re doing it abroad. Find out how much you’ll be charged and see if you can find a card that offers $0 international ATM withdrawals as that could save you a bucket (and spade).

Annual fees:

Most credit cards charge a fee every year to keep the card. When comparing which one is best for you, look at the cost of the card versus the savings you’ll make in zero international fees and make sure you come out on top, not the bank.

Sneaky requirements:
The way some of these cards work is to give you a zero foreign transaction if you meet a minimum spend within a set period. If you don’t meet these requirements, you might still incur a fee. One to look out for when comparing.

Purchase rate:
If we’ve said it once, we’ve said it a thousand times. Paying off your credit card balance in full each month is the way to go when it comes to using credit cards to your advantage.

Of course in reality this isn’t always possible, so an important factor to consider is how much interest you’ll be charged should you carry a balance over. If you have some debt, a 0% balance transfer card or low interest card could be better than one with no foreign fees.

Card protection:
It’s not always as easy to know if you’re being scammed overseas. Dodgy service providers or card cloning can happen, but you can have peace of mind knowing your card comes with fraud-monitoring services. If you’re spending overseas it’s especially important that your card has top notch security features.

FAQ’s

What is a foreign transaction fee?
It’s a charge for using your card with an overseas business. It will be charged for online transactions with international ecommerce stores and when you spend overseas in person.

It’s calculated as a percentage of the purchase amount, usually between 2-4%.

Is a zero international fee card for me?

Do you regularly spend time and money overseas?These would be the two factors to consider when choosing if the card is right for you. Of course there are many others, but for now let’s focus on the fees. Let’s assume your foreign transaction fee is 4%. If you spend $5,000 internationally that’s $200 in fees. Over the course of a year these fees can really put a dent in your wallet.

Should I look into currency conversion rates?
Making a big purchase? You can compare daily exchange rates on your credit card to help you save. When you use your Aussie card to make a foreign transaction your credit card converts the amount into Australian Dollars based on that day’s exchange rate.

Mastercard and American Express convert the foreign currency amount into United States Dollars (USD) first, then into AUD making it a little trickier to figure out how much you’ll be charged.

However Visa converts straight to AUD at the daily exchange rate, in most cases. In terms of travel cards, you should always shop around as the exchange rate will vary depending on who you go with and where you’re going.

How much will I save with a no international fee card?

Generally speaking you’re saving yourself around 3% per purchase. So the amount of savings is conducive to your spending. If you spend $2k internationally you’re saving $60, if you’re spending $20k you’re saving $600.

Don’t forget to consider ATM withdrawal fees or overseas cash advance fees if you plan to take money out from a hole-in-the-wall abroad.

Do foreign transaction cards come with free travel insurance?
Yes many do as an additional travel perk for frequent flyers. When choosing the right card, see how much a standalone travel insurance policy would cost you.

You don’t want to end up paying hundreds for an annual fee just for the insurance when you could get a far cheaper equivalent travel insurance policy elsewhere. With all the extras that come with credit cards, it’s important to ensure the benefits outway the costs.

Which is the best card for no international transaction fee?
There is not a “best card” for this. Each individual has different needs when it comes to getting a credit card. Use our comparison tables to find one that is right for you.

Do I get charged by using an ATM overseas with free foreign transaction cards?

Yes, don’t assume taking cash from an ATM is free, read the T&C’s to see if you’ll incur a flat fee. Many banks still charge for withdrawing cash at foreign ATMs, even if foreign purchase fees are waived.

Conclusion

If you’re frequently frivolous with foreign purchases, significant savings can be made from credit cards not charging for international purchases. So go on, what are you waiting for? Compare & save today.

General Advice Warning
The information provided is of a general nature only and does not take into account any personal objectives, financial situation or needs. Before making a decision you should consider the appropriateness of the information having regard to your personal circumstances. Always read the full terms and conditions.