Compare credit cards with 0% foreign fees and save money when shopping overseas.
Some credit cards charge a foreign transaction fee (usually a set percentage of the purchase amount) when you make a transaction in a foreign currency. So, whether you're travelling overseas or shopping online with an international retailer, these fees can make a dent in your budget. There is a range of credit cards that offer 0% foreign transaction fees so that you can save on these extra charges when you're spending money overseas.
Use this guide to compare cards that don't charge foreign currency conversion fees, learn more about travel money expenses and understand what you can do to minimise them.
0% Foreign Transaction Fee Credit Card Offer
The Bankwest Zero Platinum Mastercard offers 0% foreign transaction fees, complimentary insurance and no annual fee.
- Save with $0 in foreign transaction fees.
- Enjoy complimentary international credit card travel insurance and purchase protection insurance.
- Pay $0 annual fee for this platinum card.
- Take advantage of up to 55 days interest-free on purchases.
- Compatible with Android Pay.
Comparison of No Foreign Currency Exchange Fee Credit Cards
How to compare 0% foreign fee credit cards
If you're interested in getting a 0% foreign transaction fee credit card, you can consider the following factors to compare your options:
- Currency conversion fees. While most credit cards charge a fee worth 2-3% of each transaction made in another currency, a card with a 0% currency conversion fee waives this cost. If you regularly travel or shop online with overseas merchants, this could help you cut costs.
- Overseas ATM withdrawal fees. Getting cash out of an ATM overseas can also attract a fee worth at least $3 or between 2-3% of the total transaction. Choosing a card which doesn't charge for international ATM withdrawals can allow you to avoid this charge.
- Cash advance fees. Even if you get a credit card that offers $0 ATM fees overseas, using it to withdraw cash can attract a cash advance fee that's typically between 2-4% of the transaction. You'll also be charged interest at the cash advance interest rate, which is higher than the purchase rate on most credit cards.
- Annual fees. Credit cards offering 0% foreign fees may still charge an annual fee, which could be anywhere from $80-$400 or more. Ideally, the benefits you get from the card should outweigh the price of the annual fee.
- Purchase rates. If you're using your card to make overseas purchases but won't be paying back your balance in full each month, you'll need to take the purchase rate into consideration.
- Other travel benefits. Some cards offer additional travel benefits, such as complimentary travel insurance, airport lounge access or bonus frequent flyer points for your spending. Make sure you meet any requirements listed to take advantage of these perks, otherwise they won't add to the value of the card.
How much can I save with a 0% foreign fee card?
To give you an idea of the potential savings a credit card with 0% foreign fees offers, let's say you spend $5,000 while you're travelling overseas. If you had a card that charged a 2-3% fee on each foreign transaction, you'd pay around $100-$150 more for your spending.
A card with 0% foreign transaction fees would add $0 to your account balance. As well as saving you money on your spending, this would also cut down on interest charges and could help you pay off your balance faster.
How does foreign currency conversion work?
When you make a purchase or transaction in a foreign currency using an Australian credit card, the total amount needs to be converted into Australian Dollars. The conversion process varies based on factors including the card provider and whether it's an American Express, Mastercard or Visa product.
Currency conversion exchange rates are updated on a daily basis, and apply even if you have a card that charges $0 foreign fees. Please note that most banks use an exchange rate that's less competitive than the standard rate.
How will an exchange rate appear on my credit card statement?
Say you were on a trip to New York and used your Australian credit card to pay for a pair of shoes worth US$100. If the exchange rate between US dollars and Australian dollars was US$0.74 per AUD$1, then this transaction would be converted to AUD$135.14. So, instead of your credit card statement showing a transaction of US$100, it would show one of AUD$135.14.
What exchange rate will I receive?
Depending on the card you're using, you will receive the exchange rate set by Mastercard, Visa or American Express. The following diagram explains how Australian credit cards convert currency with American Express, Mastercard or Visa:
Mastercard and American Express will convert the foreign currency amount to USD before converting it to AUD (unless your transaction is already in USD). Both of these conversions will transfer at the daily exchange rate.
Visa will convert your foreign currency amount directly to AUD at the daily exchange rate.
- Mastercard and American Express. All transactions made in a currency other than United States Dollars (USD) will be converted to USD before it is converted to AUD.
- Visa. Transactions made in the following currencies will be converted directly to Australian Dollars (AUD):
- United States Dollars (USD)
- Canadian Dollars
- New Zealand Dollars
- Singapore Dollars
- Pounds Sterling
- Japanese Yen
For transactions made in any other foreign currencies, Visa will convert the currency to USD before it is converted to AUD. As a result, if the Australian Dollar is not favourable against the United States Dollar, using a Visa credit card for any of the listed currencies could be the most cost-effective option.
Foreign currency exchange calculators
- Mastercard. You can compare the daily exchange rate using Mastercard's currency conversion calculator. Simply select your settlement date, base currency (AUD) and Mastercard will show you the daily exchange rates.
- Visa. Visa also offers its own currency conversion calculator. Select the country which your credit card was issued from, the currency which you require and VISA will provide you with the daily exchange rates.
- American Express. Unfortunately American Express has not released a currency conversion calculator at this point in time.
What is Dynamic Currency Conversion?
Dynamic Currency Conversion (DCC) allows you to pay directly with Australian dollars at an overseas merchant, instead of converting the payment to a foreign currency. If you have travelled overseas, you may have been offered the choice of paying in the local currency or in Australian Dollars. By choosing to pay directly with Australian Dollars you will attract the DCC fee. Learn more about Dynamic Currency Conversion.
- How much is the DCC? The DCC ranges from 3-10%, so it's sometimes more affordable to pay in the local currency instead.
- Is it a good idea to use DCC overseas? If the Australian Dollar has improved significantly against the foreign currency, you may still save money after incurring the DCC fee.
What other travel money options are available?
It's often useful to have several ways to access money when you're overseas. As well as a credit card, you may want to consider some of these other travel money products:
- Foreign cash. Having cash on hand when you're travelling overseas can help you pay for any purchases where cards are not accepted (such as transport tickets). Using cash is also an easy way to avoid foreign transaction fees.
- Debit card. Your everyday Mastercard or Visa debit card can also be used overseas, wherever these brands are accepted. Just keep in mind that currency conversion fees may also apply for a debit card and be aware of the potential complications if your account's security is compromised while you're away. You can compare debit cards with low foreign transaction fees here.
- Prepaid travel money cards. A prepaid travel card allows you to load and spend funds in multiple currencies. This means you can spend your own cash and avoid currency conversion fees when spending in a supported currency.
If you're a frequent traveller or regularly shop online with international retailers, a credit card that has 0% foreign transaction fees could help you keep your costs to a minimum. Just remember to compare a range of options and look at the other features available so that you can find a credit card that really suits your needs.
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