WalletHub, Financial Company
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No foreign transaction fee means that a credit card or debit card does not include a surcharge for international purchases. In other words, a consumer won’t be charged extra for using the card outside of the U.S. Foreign transaction fees are usually charged as a percentage of every transaction made abroad. Most issuers charge around 3%, but many offer at least one card that does not come with a foreign transaction fee. Some issuers, such as Capital One and Discover, do not include the fee on any of their cards. Refer to the card’s terms and conditions to know for sure if it comes with a fee for foreign transactions.
It’s important to note that you don’t have to physically use a card outside of the U.S. to get hit with a foreign transaction fee. The fee can also apply when you buy something online from a company based in another country. So getting a no foreign transaction fee card can be very helpful if you buy a lot of things from abroad. It also offers consumers the best value for currency exchanges. On average, a no foreign transaction fee credit card saves international travelers 7.14% over the average bank or credit union. When compared to foreign exchange company Travelex, the savings jump to 9.31%.
However, not all credit cards with no foreign transaction fee are equal when it comes to worldwide acceptance. The card’s network dictates where you can use it outside the U.S. Cards on the Mastercard and Visa networks are accepted by merchants in more than 200 countries and territories. Discover cards work in about 185 countries and territories, and merchants in 160+ countries and territories take American Express cards.
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