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Avoiding Foreign Transaction Fees on Points and Miles Earning Credit Cards

by on March 28, 2011 · 33 comments

in American Express, Beginners Series, British Airways, Capital One, Citi, Credit Cards, Hyatt, MasterCard, Points Guy Pointers, US Airways

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Update: Some offers mentioned below are no longer available. View the current offers here: Platinum Card from American ExpressCapital One Venture Rewards Card

If you aren’t already aware, many credit card issuers charge ridiculous foreign transaction fees on every purchase you make on your credit card outside of the USA. In fact, you may even be charged this fee from within the US if the merchant processing the charge is based outside of the States. These fees – which generally range from 1-3% of your total purchases, can cost you dearly and completely negate the value of any miles or points you earn.

For example, if you go to Paris and spend $3,000 on your US Airways Mastercard, you will have to pay an additional $90 (3%), just for allowing Barclays bank the pleasure of processing your transactions. Even though you’d earn 3,000 miles, you can actually buy them cheaper directly from usairways.com for 2.75 cents each (and US Airways runs a lot of promotions, like their current 100% bonus, that makes buying miles as cheap as  1.38 cents each).

Before you travel abroad, make sure you know if your card currently has a foreign transaction fee. You can simply call your card company (the best bet since card issuers have been changing these fees lately), or check out this chart from creditcards.com. Tip: if you are applying for a new credit card, always click the Terms & Conditions link before you submit your application. Foreign transaction fees will be listed under  Fees -> Transaction fees table (usually the last fee listed).

Barclays US Airways Mastercard Foreign Transaction Fee

While foreign transaction fees are a rip-off, the good news is that there are points and mileage earning cards that don’t have these fees. If you travel abroad extensively, it’s critical you get one of those cards. Here are some of the top miles/point earning credit cards that don’t have foreign transaction fees. FYI: I’ve also added “No foreign transaction fees” on the Top Deals page to highlight this particular perk. I’m hoping there comes a day when these fees are history!

Top fee-free cards and sign-up bonuses:

25,000 points for Capital One Venture card. $59 annual fee. Waived for the first year.
50,000 points for Amex Platinum. $450 annual fee.
100,000 miles for Chase British Airways Visa. $95 annual fee. Update: The current sign-up bonus offer for the British Airways Visa is 50,000 Avios. 25,000 upon first use, and another 25,000 when you spend $2,500 within 90 days.
30,000 miles for Chase United Mileage Plus Club Visa. $375 annual fee.
2 Free nights for Chase Hyatt Visa. $75 annual fee.
60,000 points for Chase Priority Club Visa. $49 annual fee, waived for the first year.
40,000 points for Chase Sapphire Preferred. $95 annual fee, waived for the first year.
30,000 points for Citi Thank You Premier. $125, waived for the first year.
$95 Statement credit for Chase Continental Presidential Plus card. $395 annual fee.

If you know of any other fee-free points/miles cards, let me know and I’ll add them to the list.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.

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  • http://boardingarea.com/blogs/unroadwarrior/2011/03/27/if-you-had-an-infinite-wallet-what-credit-cards-would-you-carry-part-ii/ The Nomad

    Chase Priority Club Visa also has no foreign Transaction Fee

  • Tyler

    The Chase Priority Club Visa is another one …

  • Julia

    The Chase Priority Club Rewards Visa also has no foreign transaction fees. The $45 annual fee is waived for first year.

  • The Points Guy

    @Tyler & Julie- Thanks- added it to the list.

  • Leigh Witchel

    TPG – I think every Cap1 card does not have a forex fee. I have a Cap1 MilesOne Business Card, which doesn’t have a sign up bonus, but it has no yearly fee and no forex fee. Cap1 banks do not charge forex fees either.

    For foreign travel, I use m Cap1 ATM card, a Fidelity ATM card for ATMs which have a withdrawal fee (Fidelity charges 1% forex, but absorbs withdrawal fees within the Plus network) and my Cap1 credit card.

  • http://www.themrpickles.com mrpickles

    Chase United Airlines Mileage Plus Club card $450 annual fee w/ RCC access and no foriegn transaction fee.

  • The Points Guy

    Thanks Mr P- added it to the list. PS I just checked and the annual fee is “only” $375.

  • Jbiz

    Amex Platinum isn’t starting this until 4/1 — just spoke to them on the phone.

  • The Points Guy

    @Jbiz- interesting, because they uploaded a new version of the member agreement on 3/27 and it states no foreign transaction fees.

  • http://blog.infomofo.com InfoMofo

    Wow, I have been planning for some time to get one of the no-fee capital one credit cards to keep in a sock drawer for international purchases and travel, but this signup bonus for the venture card sounds amazing. I guess I’ll sign up for that now, and then downgrade to the no-fee card after a year.

  • Steve G

    I love my British Airways card for intl travel!

  • Todd

    I use the PenFed Premium Travel Rewards American Express card. There is no foreign transaction fee and now there is no annual fee either. Plus the rewards program is pretty good when you use it for flights.

  • mike

    Charles Schwab is another that doesnt charge foreign fees. They recently discontinued their credit card, but they still offer a Visa labeled check card that can definitely be handy :P

  • John

    Any info regarding best Canadian earning cards with no transaction fees? Txs

  • JC

    I was going to tell you to add the Schwab Visa Signature Card – which I wanted to get but doing some research around it seems that they are not offering that card anymore :-/

  • http://traveltostlucia.com Tai

    I never knew about getting a card that does not charge fees! I can save a ton and get miles with one of these cards. This makes charging all those rum punches on the beach in St. Lucia even better!Thanks! :-)

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  • JOHN

    I DONT RECOMMEND THE CAPITAL ONE CARD. THEY GIVE TERRIBLE CREDIT LIMITS. I ORDERED A CARD AS I AM A VERY FREQUENT INTERNATIONAL TRAVELER. I HAVE STELLAR CREDIT (AMERICAN EXPRESS PLATINUM) AND WAS GIVEN A $1,000 CREDIT LIMIT. AFTER CALLING AND TRYING TO GET THIS LIFTED I CLOSED THE CARD. I HAVE SPOKEN TO OTHERS ABOUT THIS AND APPARENTLY I AM NOT ALONE. BIG WASTE OF TIME!

  • ej

    capitalone no hassle rewards. no annual rate, no foreign fees just exchange rate. traveled for 2 years all over the world and had no issues except you have to let them know where you are going every 3-6 months

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  • DaveS

    Among the things I don’t understand very well is how credit card companies establish credit limits. For the Capital One Venture card I got $17,500, a much different experience than John’s.

  • JC

    Hi There,
    love your blog. it’s awesome! I got the 100k offer for the BA credit card for the points but also for the no foreign overseas charges on the card. I just go the card today and the disclosure says there ARE fees for foreign transactions. I called customer service but they are useless. Has anyone on this blog used the card overseas and can tell me if they do indeed charge or not? (going to Europe and spending quite a bit and dont want any surprises). txs!

  • Amol

    Got the BA credit card via this site and used it in Vancouver. Didn’t notice any fees and it’s been over a week …

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    PNC bank check card, no ATM fee worldwide for acct
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  • Fx

    I just call and get it waived.

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  • Jeff

    I am just back (5/12) from Spain and ran into a new rip-off: Merchants have the capability of submitting your charge in Euro, or in dollars with a 2% “commission”. This means that if you are using a credit card (like mine, CapOne) that has no or lower fees for currency conversions, if the merchant opts to submit in dollars, you will get skimmed. I smell some kind of commission splitting with the merchants because the waiters and hotels were sneaky about it.

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  • http://www.cardauthorizer.com/ credit card processing

    I got the 100k offer for the BA credit card for the points but also for the no foreign overseas charges on the card. I just go the card today and the disclosure says there ARE fees for foreign transactions. I called customer service but they are useless. Has anyone on this blog used the card overseas and can tell me if they do indeed

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