What does debit card foreign transaction fee mean?

As is the case with credit cards, international use of a debit card may trigger a special fee. The structure and amount of the fee depend on the bank and the nature of the transaction. For example, if the debit card is used to withdraw money from an ATM, several different fees might be layered together. (See Foreign ATM Fee.) If the debit card is used to make a point-of-sale payment, such as at a store, hotel, or restaurant, the fee will resemble a credit card foreign transaction fee, and may amount to about 1% to 3% of the transaction.

Typically, the foreign transaction fees charged by credit unions are lower than those charged by banks. Some banks and credit unions offer debit cards with no foreign transaction fee.