How to avoid foreign currency exchange fees when travelling

Information verified correct on August 25th, 2016
Spending-Money-in-Foreign-Currencies

Are you going overseas? Avoid foreign transaction fees with the right travel money, so you can save more on your holiday.

Using a credit card while travelling overseas may be convenient, but it can get quite costly when you factor in rates and fees. Learning how to get the most ideal rates and how to avoid unnecessary fees can go a long way towards saving you cash that could be better spent on your travels.

What rates and fees should I be watching out for?

When spending abroad with your card, you will encounter one or both of these—the foreign currency exchange rate and the foreign currency conversion fee. You may notice first of all, that your card exchange rate is less favourable than the listed interbank rates. This may be to incorporate a wee profit margin for your card company. Next, you’ll be charged a foreign transaction fee or currency conversion fee on each overseas transaction. This is typically 3% of the transaction amount, which can amount to hundreds of dollars if you consistently swipe your card for big ticket items.

These fees can be avoided though. It’s all about choosing the right travel money product. You can compare some of your options below.

Comparison of travel money products

Rates last updated August 25th, 2016
Foreign Currency Conversion Fee (MC) Foreign Currency Conversion Fee (VISA) Overseas ATM Withdrawal Fee Annual fee
Bankwest Zero Platinum MasterCard
Complimentary travel insurance & 24/7 concierge service and $0 foreign transaction fees.
0% of transaction value $0 $0 p.a. Go to site More info
28 Degrees Platinum MasterCard
No foreign transaction fees on international purchases including international purchases online, together with a no annual fee.
0% of transaction value $0 $0 p.a. Go to site More info
ANZ Rewards Travel Adventures card
Pay no overseas transaction fee on purchases and receive complimentary domestic return flight and lounge passes each year you hold the card when you spend $500 on eligible purchases within the first three months.
0% of transaction value $225 p.a. Go to site More info
Bankwest Breeze Platinum MasterCard
Enjoy no foreign transaction fees on online and overseas purchases, complimentary travel insurance, a low ongoing purchase rate and $0 annual fee for the first year. Limited time only.
0% of transaction value $0 $0 p.a. annual fee for the first year ($99 p.a. thereafter) Go to site More info
Bankwest Qantas Platinum MasterCard
Receive 50,000 introductory bonus Qantas Points. New customers only. Minimum spend, terms and conditions apply.
0% of transaction value $0 $160 p.a. Go to site More info
Coles Rewards Mastercard
Earn 2 flybuys point for every $1 spent and no foreign transaction fees for online purchases and overseas trips.
0% of transaction value $4 $89 p.a. Go to site More info
Bankwest More Platinum MasterCard
No fees on overseas ATM withdrawal, no foreign transaction fees and earn 28,000 bonus More Reward Points.
0% of transaction value $0 $130 p.a. Go to site More info
Rates last updated August 25th, 2016
Available Currencies ATM Withdrawal Fee Reload Fee Initial Load Fee
ANZ Travel Card
ANZ Travel Card
AUD, CAD, EUR, GBP, HKD, JPY, NZD, SGD, THB, USD, AUD 3.50, CAD 3.00, EUR 2.20, GBP 2.00, HKD 20.00, JPY 260, NZD 4.50, SGD 4.00, THB 95, USD 2.50 1.1% of the value purchased $0 Go to site More
Flight Centre Key to the World Currency Card
Flight Centre Key to the World Currency Card
AUD, USD, SGD, NZD, JPY, THB, GBP, EUR, HKD, CAD USD 2.50, EUR 2.50, GBP 2.00, NZD 3.50, THB 80.00, CAD 3.50, HKD 18.00, JPY 260.00, SGD 3.50, AUD 3.50 1.1% of the total amount $0 Go to site More
Travelex Travel Card
Travelex Travel Card
AUD, CAD, EUR, GBP, HKD, JPY, NZD, SGD, THB, USD Travelex does not charge an ATM withdrawal fee when you use your Travelex Multi-currency Cash Passport to withdraw currencies that are loaded on the card at overseas ATMs where MasterCard is accepted. The greater of 1.1% of the initial load / reload amount or AU$15.00 $0 Go to site More
Rates last updated August 25th, 2016
$
Monthly Account Fee Debit Card Access ATM Withdrawal Fee Fee Free Deposit p.m. Details
Westpac Choice
$0 ATM withdrawal fee at 50,000+ ATMs globally.
Via Westpac's Global ATM Alliance. Get Cash without your debit card (conditions apply).
Mastercard $0 $2,000 No ATM fees when using St.George, Westpac, BankSA or Bank of Melbourne ATMs in Australia. Deposit at least $2,000 per month and enjoy no monthly service fee. Open More
Bankwest Platinum Debit MasterCard
Earn points on your balances and every time you use your debit card. Plus no overseas ATM withdrawal fees
Mastercard $0 $4,000 No overseas ATM fees charged by Bankwest, No monthly account fee when you deposit at least $4,000 per month. Open More
Citibank Plus Everyday Account
Free international money transfers and free overseas Citibank ATM withdrawals.
Visa $0 $0 No ATM fees using Citibank, Westpac, BankSA and St.George branded ATMs in Australia. Use overseas Citibank ATMs for free. More
Rates last updated August 25th, 2016
Foreign Currency Conversion Fee (MC) Foreign Currency Conversion Fee (VISA) Overseas ATM Withdrawal Fee Annual fee
Bankwest Zero Platinum MasterCard
An introductory offer on balance transfers with $0 annual fee. Complimentary travel insurance & 24/7 Concierge service and $0 foreign transaction fees.
0% of transaction value $0 $0 p.a. Go to site More info
28 Degrees Platinum MasterCard
Benefit from no international transaction fees on purchases, no currency conversion fees and no annual fee. Also enjoy a limited time offer of two waived cash advance fees.
0% of transaction value $0 $0 p.a. Go to site More info
Bankwest Qantas Platinum MasterCard
Receive 50,000 introductory bonus Qantas Points. New customers only. Minimum spend, terms and conditions apply.
0% of transaction value $0 $160 p.a. Go to site More info
Bankwest Qantas Gold MasterCard
Earn more points with the Qantas Frequent Flyer rewards program when you make eligible purchases and also get the chance to receive 4,000 bonus Qantas Points when you sign up, plus stay protected with a comprehensive travel insurance.
2.95% of transaction value $0 $150 p.a. Go to site More info
Bankwest More Platinum MasterCard
$0 foreign transaction fees and complimentary insurance cover.
0% of transaction value $0 $130 p.a. Go to site More info

How can you avoid foreign currency exchange fees?

 No foreign transaction fee credit cards

If you’re a frequent traveller to faraway lands, it is advisable to seek out credit cards designed for travelling. These cards advertise low or no fees on foreign transactions, are connected to extensive worldwide ATM networks, and in some cases will even waive any extra fees for currency conversion. You may pay a slightly higher annual fee for this type of credit card, but the money you’ll save on overseas spending might balance that out.

 Prepaid travel money cards

Prepaid travel money cards provide a happy compromise between credit card and cash. You can load these cards with Australian dollars, then convert the funds you’ve loaded into any of the foreign currencies supported by the card. Then if you use your card to spend anywhere the loaded foreign currencies are the local currency, you’ll save on currency conversion fees.

These cards can come with fees including purchase fees, loading or reloading costs and ATM withdrawal charges. Weigh these fees up against how much you could save on currency conversion fees to determine whether it’s a valuable option.

Compare prepaid travel money cards here

 Using debit cards

Most Australian debit cards will charge foreign currency exchange fees when used overseas. To save costs on your next holiday, look for a debit card with low or no foreign transaction fees. Unlike a credit card, debit card transactions don’t incur interest and you can withdraw funds without being charged a cash advance fee. If your card belongs to an international ATM alliance, you can also save on ATM withdrawal costs.

Compare travel debit cards here

 Frequent flyer credit cards

Rewards are typically more expensive when it comes to annual fees and interest rates, but you can find some with no foreign transaction fees. If you’re usually able to repay your balance each month, a rewards credit card with no foreign transaction fees could be a great way to get rewarded for your holiday expenses.

Compare rewards credit cards here

 Using cash

Carrying the local currency in cash is another way you can avoid foreign transaction fees on day-to-day holiday expenses. It’s not exactly safe to carry all of your travel budget in cash though, so look for a card that has low ATM withdrawal fees if you’re considering paying in cash.  

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What are the other costs and features to consider?

Even if your travel money card or strategy helps you avoid currency conversion fees, there are still other costs and factors to consider. When you’re comparing your travel money options, keep the following in mind as well:

  • ATM fees. If you’re not careful, you could end up paying fees for using an overseas ATM twice. Unless your bank has a global ATM alliance that allows you to make international withdrawals for free, you could be charged by your bank and the issuing bank for withdrawals and even account balance enquiries when travelling.
  • Annual fee. The price for paying low or no foreign transaction fees on your credit card is often a high annual fee. Before committing to any one card, make sure that the savings and rewards you’ll reap outweigh the annual fees for the card. You can compare cards with no annual fee or foreign transaction fee here.
  • Supported currencies and global acceptance. Make sure the card you’re using will work in your holiday destination. Make sure that your credit card is accepted worldwide, as you can expect with a Visa, MasterCard or American Express. If you’re using a travel money card, make sure it supports the local currency you’ll be using or doesn’t charge a currency conversion fee.
  • Merchant fees. You might find in some places that the merchant adds a surcharge to your transaction for using a foreign issued credit card. It would be prudent to check your bill before paying to avoid that fee wherever possible, and to have alternative travel money options on hand in those events.
  • Exchange rates. Check to see how often exchange rates are updated and if there are additional fees for currency conversion. A good way to avoid negative exchange rate movements is to lock in the rates with a travel money card.
  • Additional travel perks. Complimentary travel insurance, a 24/7 global emergency customer service line and frequent flyer rewards programs are all extras that could offer some added value to your card.

How often you travel, the length of your stay, and the way that you spend money abroad all factor into your decision about the type of credit, debit or travel card to use abroad. Be sure to consider your typical expenses and everyday spending needs when choosing a card that will offer you the most value.

Ways to avoid travel money fees and charges

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Sally McMullen

Sally McMullen is a journalist at finder.com.au who is a credit cards and travel money expert by day and music maven by night.

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31 Responses to How to avoid foreign currency exchange fees when travelling

  1. Default Gravatar
    matthew | May 20, 2016

    The company that I work for has told me that they can pay me in USD at the current exchange rate eliminating the need to convert AUD to foreign currency at the banks exchange rate. Is there any travel card that I can get that I can load foreign currency directly on to.

    • Staff
      May | May 23, 2016

      Hi Matthew,

      Thanks for your inquiry.

      Yes, there are actually travel money cards that you’ll be able to load and reload multiple currencies onto. You can find them here.

      I hope this has helped.

      Cheers,
      May

    • Default Gravatar
      matthew | May 23, 2016

      Yes, I know but are there travel cards that I can load USD directly on to them not by converting AUD to USD at the banks exchange rates. I can get paid in USD so this would save me a lot of money with conversion fee’s and lost money due to banks low currency exchange rates on these cards.

    • Staff
      May | May 23, 2016

      Hi Matthew,

      Thanks for you reply.

      Yes, there are travel cards that will allow you to load USD directly onto the card. In fact, all Australian travel money card issuers allow you to do that. You can lock in an exchange rate when you convert AUD to USD and spend without paying the extra 3% for currency conversion. Please feel free to visit this page for more information.

      I hope this has helped.

      Cheers,
      May

  2. Default Gravatar
    Kaye | May 17, 2016

    We have a Bankwest Platinum credit card which we plan to use when travelling overseas. Some people are saying that if you pre-load this card with your own money, any cash withdrawal using your own money has ‘no’ cash withdrawal fee applied because it is the platinum card. Is this the case?

    • Staff
      May | May 17, 2016

      Hi Kaye,

      Thanks for your question.

      Unfortunately, that is not the case. However, you can load your Bankwest Platinum credit card with funds. Please find the two circumstances below when loading your account with funds:

      1. If your account is current and has no outstanding balance – it will make your card in a positive balance. If you withdraw cash at any ATMs abroad, you will be charged with $4 fee every time you withdraw but, you will not be charged with a foreign transaction fee.

      In the meantime, if you withdraw money that is more than your loaded funds (money from your credit limit), that transaction is considered as a cash advance and fees/interests as well as foreign transaction fees will be charged to your account.

      2. If your account has outstanding balance – any amount you load onto your credit card will clear the debt first and be regarded as a Credit Card Payment. As an example, you have $10,000 credit limit and you have a current outstanding balance of $6,000 (spent), that means you only have $4,000 left on the account (credit limit). Once you load your card with $8,000, the $6,000 will be treated as a payment and you only have $2,000 left to use your own funds.

      I hope this has answered your question.

      Cheers,
      May

  3. Default Gravatar
    Ann | May 1, 2016

    I’m going to Europe and I’m confused re the pre loaded card. There seems to be a fee to have it also a fee for transactions. I’m consider ing just convert my money before I go. But I’ll also have money in my own debit card, how do I access this money without paying excess fees??? All confusing????????

    • Staff
      Ysa | May 4, 2016

      Hi Ann,

      Thanks for your question.

      Pre-loaded cards or prepaid travel cards lets you hold multiple currencies in Europe. However, in some cases, spending in a currency not loaded on the card will incur you currency conversion fees.

      On the other hand, there are also some charges associated with international debit card use, usually ATM and currency conversion fees. To avoid incurring these fees, take time to compare which debit card is right and suitable for your next holiday in Europe.

      You may wish to check our Travel Money Guide: Europe for a comprehensive guide and clear comparison on how each travel money option work in Europe.

      I hope this helps.

      Cheers,
      Ysa

  4. Default Gravatar
    Marie | April 24, 2016

    I am travelling soon and will be using GBP, USD & euros. I don’t know how much of each I will need Do I have to load specific amounts of each denomination? Are they interchangeable?

    • Staff
      Sally | May 13, 2016

      Hi Marie,

      Thanks for your question.

      If you get a travel money card, you can load Australian dollars on your card and then transfer them to the relevant currency wallets as you need to use the funds. So, say you’re visiting the UK first, you can move your funds into your UK currency wallet, then transfer the remaining funds into your Euros wallet or USD wallet as you need them.

      You can start comparing travel money cards here.

      I hope this has helped.

      Cheers,

      Sally

  5. Default Gravatar
    robert | April 7, 2016

    is there a conversion charge for using a debit card oversees

    • Staff
      Sharon | April 8, 2016

      Hi Robert, thanks for your inquiry.

      Australian debit cards when used overseas will require currency conversion fees. You may also refer to our best debit cards to use when travelling overseas* review to help you save money if you’re planning to use one.

      Cheers,

      Sharon

  6. Default Gravatar
    ron | October 3, 2015

    what credit card will allow me to preload using my own money and then allow me to withdraw it overseas from an atm or bank without charging me the cash advance fees

    • Staff
      Jonathan | October 6, 2015

      Hi Ron, thanks for your inquiry!

      Preloading a credit card can avoid the cash advance fees, however regular benefits such as fraud protection can be lost in such circumstances. We do not currently have a list of cards that allow this transaction, was there a specific bank/lender you had in mind today? You may like to refer to our guide on how to avoid foreign currency exchange fees when travelling.

      Cheers,

      Jonathan

  7. Default Gravatar
    | September 4, 2015

    Some European merchants capitalizing on the fact that many Americans are intimidated by unusual currencies cheerfully charge you for converting their prices to dollars before running your credit card. So, how can a smart traveler avoid or at least reduce these fees?

  8. Default Gravatar
    Nigel | January 19, 2015

    Hi, I have noted the cash advance fee from ATM’s overseas but can you confirm if interest in charged from the day you obtain that cash advance? Is this interest negated if the full outstanding balance is paid within the 55 day period?

    • Default Gravatar
      Nigel | January 20, 2015

      Hi Jonathan,

      Thanks for your reply. Sorry I should have been more specific regarding which card I would be using. It would be a 28 degrees MasterCard with the 55 day interest free period. Given this info can you specify what charges would be payable and whether the interest on the cash advance only starts to be charged after the 55 day period or from the day the cash a advance is taken out. Thanks again for your help.

    • Staff
      Jonathan | January 20, 2015

      Hi Nigel,

      A cash advance fee of 3% of the cash advance or $4 (whichever is greater) will be charged to the account on each occasion on which you obtain a cash advance or make a cash equivalent transaction, interest will be charged on the cash advance fee on a daily basis from the date of the withdrawal. If your account is in credit, you will not be charged interest on the cash advance fee.

      I hope this helps!

      Cheers,

      Jonathan

    • Staff
      Jonathan | January 20, 2015

      Hi Nigel,

      Thanks for your question,

      Depending on the credit card you are using, on top of the normal interest rate and lack of interest free days, you can be imposed a $1-$10 / 1%-4% fee (whichever is higher) every time you carry out an overseas cash advance. You will also be charged the standard cash advance rate for your credit card (as well as the international cash advance fee).

      I hope this helps!

      Cheers,

      Jonathan

  9. Default Gravatar
    aengus | June 28, 2014

    I like 28 degrees but as they changed the rules on 1st of Jan 2014 and now charge 3% or $4 for cash-out from a preloaded card, I use it for online or credit transactions abroad only

    Cash out, at $2.50 per t transaction, I do via Ing orange everyday, a debit card.

  10. Default Gravatar
    Trevor | February 2, 2014

    We have had a GE 28 Degrees MasterCard while travelling overseas for some years now.
    Plan to travel to Russia, Finland, Sweden, Denmark, Norway then Ireland later this year.
    Can we use this card in these counties? We usually pre load our card before setting off.

    Trevor

    • Default Gravatar
      Anne | February 20, 2014

      Note the GE 28degrees card has changed. You now pay a withdrawal fee for withdrawals from ATM’s even if it is your own money loaded onto the card (i.e. even if it is in credit.) 3% or $4 whichever is the higher amount. Still no international transaction fee though and no currency conversion fee for both ATMs and credit-type transactions.

    • Staff
      Jacob | February 20, 2014

      Hi, Anne.

      Please feel free to have a chat about this product with other users in the finder forum. Here’s a link to the travel money section. Feel free to start a new post on this topic.

      Thanks!

    • Staff
      Shirley | February 3, 2014

      Hi Trevor,

      Thanks for your comment.

      Yes you can use the card in those countries and wherever the MasterCard symbol is displayed.

      If you preload the card with funds beforehand, your insurance and security benefits may be voided – so it’s best to confirm this with GE Money before you head overseas.

      Cheers,
      Shirley

Credit Cards Comparison

Rates last updated August 25th, 2016
Purchase rate (p.a.) Balance transfer rate (p.a.) Annual fee
Virgin Australia Velocity Flyer Card - Balance Transfer Offer
Enjoy a 0% p.a. balance transfer offer for 18 months and also earn 2 bonus Velocity Points in the first 3 months on everyday spend.
20.74% p.a. 0% p.a. for 18 months $64 p.a. annual fee for the first year ($129 p.a. thereafter) Go to site More info
ME Bank frank Credit Card
Enjoy a low and consistent interest rate on purchases and cash advances, combined with no annual fee.
9.99% p.a. $0 p.a. Go to site More info
Citi Qantas Signature Credit Card
Earn up to 70,000 bonus Qantas Points on eligible spend, plus enjoy a 0% p.a. for 6 months offer on balance transfers.
20.99% p.a. 0% p.a. for 6 months $99 p.a. annual fee for the first year ($395 p.a. thereafter) Go to site More info
American Express Essential Credit Card
Receive a $50 credit on eligible spend and get Smartphone screen insurance combined with a no annual fee for life card. Also enjoy a 0% p.a. balance transfer rate for 12 months.
14.99% p.a. 0% p.a. for 12 months with 1% balance transfer fee $0 p.a. Go to site More info

* The credit card offers compared on this page are chosen from a range of credit cards CreditCardFinder.com.au has access to track details from and is not representative of all the products available in the market. Products are displayed in no particular order or ranking. The use of terms 'Best' and 'Top' are not product ratings and are subject to our disclaimer. You should consider seeking independent financial advice and consider your own personal financial circumstances when comparing cards.

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