Banks want to make money, but sometimes they go too far – a case in point being foreign transaction fees. The problem with foreign transaction fees is that banks charge customers around 3%. The customer gets no service in return for this charge.
The problem with foreign transaction fees
The first issue to take with a foreign transaction fee is the fact that it’s merely an additional charge added to any purchase that is processed abroad – meaning outside of the United States. Foreign transaction fees have nothing at all to do with foreign exchange rates. Even if you make the charge while sitting from your home in Lansing, Michigan from a foreign company without a US website, you might find an extra charge on your bill come statement time.
Since no additional costs are associated with processing transactions abroad, the banks are able to charge this extra fee at our expense, and most annoyingly for no reason at all. Now for the good news. Because word of the outrageous foreign transaction fees have spread, more consumers are aware and savvy about avoiding cards with the useless charge. Moreover, many banks have since dropped the charge all together.
There are a handful of companies that don’t charge foreign transaction fees at all – like Capital One and Discover – however, some of the common fees charged range from 2.7% at large credit card issuers like American Express to 3% at places like Bank of America, Chase, Citi, and Wells Fargo.
If you’re someone who travels frequently or you find yourself making purchases from many foreign websites than you could really benefit from one of the cards available without foreign transaction fees. Here’s a list of 10 of our favorites:
Chase Sapphire Reserve
Released in 2016 you can earn 3x points on all travel spending that includes airfare, hotels, car rentals. You also get 3x points on dining purchases along with a point per dollar that’s spent anywhere else. Some great additional benefits include a $300 travel statement credit, a $100 Global Entry or TSA PreCheck application fee credit every four years along with a Priority Pass Select membership that includes guests. Annual fee: $450. See card here.
Chase Sapphire Preferred
The Chase Sapphire Preferred offers 60,000 bonus points after $4,000 on purchases is made with in the first three months of creating the account. It equates to $750 in travel when the points are redeemed through the Chase Ultimate Rewards portal. For travel and dining purchases, you’ll receive 2x points and a point per dollar spent anywhere else. Annual fee: $95. See card details here.
Barclaycard Arrival Plus World Elite Mastercard
Miles can be used to clear away travel purchases from your statement that equates to 1 cent per mile, which makes this a cool card to have in your travel tool kit so to speak. Any spending with get you 2x miles and each time you redeem you’ll get 5% of your miles back. Right now, the card has a 70,000 mile sign-up bonus when $5,000 is spent in the first 90 days. Annual fee: $89 (fee is waived first year). See card details here.
Southwest Rapid Rewards Priority Credit Card
A new and premium card without foreign transaction fees. With this card you’ll receive $75 in annual Southwest credit, four upgraded boarding per year along with 7,500 points per year after the first year. At this time, they’re giving 60,000 points when $2,000 in purchases has been made in the first three months. Annual fee: $149. See card details here.
United Explorer Card
You can earn 2 United miles per dollar spent at restaurants, hotels and on United purchases. One checked bag free for you and a companion is available when traveling on the same reservation for United flights. Also included is 25% back on inflight purchases onboard United, two United club passes a year, and credit up to $100 every four years as reimbursement for Global Entry or TSA PreCheck application fee. Annual fee: $95 (fee is waived first year). See card details here.
Citi/AAdvantage Platinum Select World Elite Mastercard
You can earn 2 AAdvantage miles per dollar spent on many American Airlines purchases, dining and when filling up the tank of your car. This card will give you benefits when flying American Airlines operated flights such as fee waived for first checked bag on domestic travel for you and up to four companions on one reservation, access to reduced mileage awards along with preferred boarding. Annual fee: $99 (fee waived first year). See card details here.
Citi Prestige Card
If you love dining out then this is the card for you. Worth noting is the great travel protections it offers, making this card great for airfare. The Citi Prestige Card will earn you 5 Citi ThankYou points per dollar spent on airfare and eating at restaurants, once again making it great for restaurants too. For each dollar spent on hotels or cruises you will earn 3 points. You can also get a 4th hotel night free when booked through ThankYou.com (will be limited to two times a year starting this September however), a Priority Pass Select membership, and receive $250 in travel credit annually. Annual fee: $495. See card details here.
Citi Premier Card
You’ll earn 3x points for travel and at many gas places along with 2x points when spending on dining and entertainment. Everywhere else will earn you one point per dollar. Citi ThankYou points transfer to many different programs or may be redeemed for 1.25 cents each on airfare when you book through Citi’s ThankYou Rewards Travel Center. 50,000 ThankYou points are earned with $4,000 is made on purchases during the first 3 months. Annual fee: $95 (fee waived for first year). See card details here.
The Platinum Card from American Express
Tickets bought directly from airlines or through American Express Travel will earn you 5x Membership Rewards points. 5x points are earned on hotels booked through amextravel.com. Additional benefits include up to $200 annual airline fee credit, Uber credits, reimbursement for Global Entry or TSA PreCheck application fee every four years along with entry to Delta Sky Clubs, Amex Centurion and Priority Pass Select lounges. Annual fee: $550. See card details here.
Capital One Venture Rewards Credit Card
You can now earn 50,000 bonus miles with $3,000 in purchases made within three months of opening an account. 2x miles are earned on all purchases with 10x miles being earned when you use this card to book and pay for hotels at Hotels.com via a special link. Annual fee: $95. See card details here.