If you enjoy online shopping on international websites or if you’re going overseas, save money and pay no foreign transaction fees with these credit cards.
But if you’re a regular credit card comparer, you may have noticed that these type of credit cards usually come with an annual fee, which could have made the money you saved from foreign transactions redundant. The good news is, we’ve found some credit cards that don’t charge an annual fee as well as a no foreign transaction fee so you can shop happier overseas.
Comparison of no annual fee credit cards with no foreign transaction fees
What is a no annual fee credit card with no foreign transaction fee?
This is a credit card that doesn’t charge the yearly service fee as well as the fee for making international purchases. You’ll also notice that when you use your credit card for international purchases, there is an extra fee called a foreign transaction fee. This covers the cost of your bank converting the money into a foreign currency. Fees usually vary according to the type of card you have, but they are generally around 2% – 3% of the transaction amount.
How does a no annual fee credit card with no foreign transaction fee work?
It works in the same way as a regular credit card, except you don’t have to be worried about being charged extra for making international purchases or using your credit card overseas (except for cash advances and ATM withdrawals). You also don’t have an annual fee to worry about either.
Case study – fees vs benefits
Credit cards with an annual fee usually have more benefits as an extra benefit to the cardholder. In this case study, you can see that while the Commonwealth Bank Gold Awards MasterCard has an annual fee, it is the only one linked to a rewards system. In terms of credit card features such as balance transfers, security and interest free days, all three cards share them. An extra bonus with the Bankwest Zero Platinum MasterCard is complimentary travel insurance, which is an incredibly competitive offer considering most card on the market have an annual fee for this.
Foreign transaction fee
An introductory offer on balance transfers, complimentary travel insurance & 24/7 and concierge service.
An introductory offer on balance transfers, 55 days interest free on purchases, fraud protection and a 24/7 online service. Plus new customers can save from two cash advance fees waived for a limited time.
An introductory offer on balance transfers, 55 days interest free on purchases, complimentary services and linked to an awards system.
How to compare no annual fee credit cards with no foreign transaction fee
- Complimentary insurances. If you’re a regular traveller, then you may want to consider a credit card that has complimentary travel insurance. This includes medical and hospital cover, loss/damage/theft, delayed baggage, as well as car hire insurance excess. Otherwise, there are other insurance covers like purchase security cover, purchase extended warranty, purchase price guarantee as well as complimentary concierge.
- Interest rates. Having a credit card with a low interest rate should be the ultimate goal for any credit card holder as the benefits are long lasting and immediate. However, it should not be subject to time constraints or special conditions, like those of balance transfers and promotional rates as it could hide the true interest rate.
- Balance transfers. This is a credit card that lets you transfer your existing credit card balance onto a new one and repay it at a much lower rate, sometimes at even 0% p.a interest. Be mindful that when the balance transfer offer expires, the remaining balance will generally revert to the standard purchase rate of the credit card, but in some cases it could be the cash advance rate.
- Security. Again, if you’re a regular traveller or you purchase items from a lot of international websites, then credit card security is essential. In the case that your card gets stolen or lost while overseas, you need to be able to have access to a replacement card or notify your credit card provider to stop fraudulent transactions. Likewise, if someone obtained your credit card details online, then it could be prone to fraud activity.
Pros and cons
- No fees. These cards don’t charge an annual fee or foreign transaction fees, which means that you could potentially save up to hundred of dollars.
- Internationally friendly. Most of these credit cards are designed for online shoppers and those who travel frequently, so if you fit into that category these credit cards may be able to save you a lot of money.
- No rewards program. To make up for the annual fee, these credit cards are not linked to a reward program. So while you make big purchases or fly on airlines, you can’t offset part of the cost with the rewards or miles.
Case study – rewards value vs fees
It’s important to consider the rewards value of the points you’re getting with your credit card. While it is linked to a rewards system, you need to consider whether earning points is worth the fees. For example, the Bankwest Zero Platinum doesn’t charge anything for foreign purchases, while the Commonwealth Bank Gold Awards card charges a 3% foreign transaction fee. Looking at the case study below, you can see that an annual spend of $1,000 online only earns $5.10 in rewards value, compared to the $30 you’ve paid in foreign transaction fees.
Bankwest Zero Platinum MasterCard
Commonwealth Bank Gold Awards MasterCard
$0 p.a. annual fee for the first year ($119 p.a. thereafter)
Foreign transaction fee
Reward points (value)
Things to avoid with no annual fee credit cards with no foreign transaction fees
- Overspending. Just because you don’t have to pay an annual fee or a foreign transaction fee doesn’t mean you overspend. It’s much better to align your spending habits with the perks of the credit card, like only using the credit card when shopping online and a low interest credit card for regular purchases.
Frequently asked questions about no annual fee credit cards with no foreign transaction fees
What is the *best credit card for travel?
The *best card for travel will come down to your needs. To make a full comparison please see our travel money page.
Where can I find credit cards with no foreign transaction fees?
If rewards really aren’t your thing, and you just want to save on foreign transaction fees, please see this page for a comparison of no foreign transaction fee credit cards.
Where can I find credit cards with no annual fee?
If you have decided that you aren’t worried about foreign transaction fees or rewards and don’t want to pay an annual fee, please see our extensive guide to no annual fee credit cards.
Where can I find out more about exchange rates?
To find out more about exchange rates and bank fees, please see this page about the basics of foreign exchange rates and foreign currency.
As with any credit card, there’s a lot more to consider than just the fees. If you only use your credit card for a small amount of purchases then foreign transaction fees won’t be as relevant to you. You may want to consider having more than one credit card, with one as a fee-free options and the other as rewards credit card.Back to top