Published July 23, 2012
Using a credit card when you travel is easy and secure, and you can see everything you spent in one place when you get your monthly statement. But when that statement arrives, you may be shocked to see an extra 3% added to each purchase you made in a foreign currency.
This is the foreign transaction fee, or FTF. The FTF is usually made up of 1% charged by the transaction network - such as MasterCard or Visa - and 2% charged by the issuing bank, for a total of 3%.
A few years ago, only Capital One credit cards and a few premium cards, such as the American Express Centurion, waived the foreign transaction fee. Now, as card issuers seek to attract and retain low-risk cardholders who swipe their cards for everything from a daily coffee to a first-class ticket to Hong Kong, many issuers have dropped the FTF on their travel cards. In addition, they're offering multiple ways for cardholders to earn points or cash back by using these cards.
CardRatings.com recently compiled a list of 36 cards from common issuers to show you which ones take care of the FTF for you, which charge an annual fee, and some highlights of their rewards programs. Many credit unions also waive the FTF on their cards, however, those cards are not generally available to the wide public.
Capital One cards are still attractive, as none of them have the foreign transaction fee and many do not carry an annual fee. All of Discover's cards come without the FTF and only one (Escape by Discover) has an annual fee, but Discover's acceptance internationally has traditionally been limited.
Only two cards on our list - the Citi ThankYou Prestige and the Chase J.P. Morgan Select - are EMV-compatible. EMV credit cards, which use a security technology of embedded chips, are prominent in European cards and are slowly becoming more prevalent in the United States. These cards can be used in shops, at kiosks, and anywhere else you would normally use a credit card internationally.
Sixteen of the cards on the list have no annual fee, and 10 waive the annual fee for the first year. The annual fees range from $39 (Capital One Cash Rewards) to $450 (American Express Platinum and Business Platinum and Citi Executive/AAdvantage WorldElite MasterCard). The $450 annual fee is high, but for that you get free baggage, airport lounge access, priority screening and boarding and many other perks. If you're an international jet-setter, these benefits will be worth a lot more than $450 when your flight has been canceled and you're looking at spending the night in an airport. Or you could look at it another way: Annual single membership to the Delta Sky Club costs $450 by itself.
Here are the details on the CardRatings.com foreign transaction fee survey.
Data as of July 11, 2012
|Card name||Annual fee||Other benefits|
|Platinum Card from American Express||$450||$200 airline fee credit, airport club access|
|Business Platinum from American Express OPEN||$450||$200 airline fee credit, airline club access, concierge service, 2 points with AmEx Travel, 1 point for all other purchases|
|Bank of America BankAmericard Travel Rewards||$0||1.5 points per dollar, airline fee credit|
|Bank of America Privileges with Travel Rewards||$75 after first year||2 points per dollar, airline fee credit|
|Bank of America WorldPoints Travel Rewards for Business Visa||$0||1.5 points per dollar, expense tracking features|
|Capital One Cash Rewards||$39||50% cash bonus on all cash earned annually|
|Capital One Cash Rewards for Newcomers||$0||2% cash back on travel, 1% cash back on other purchases; for average credit|
|Capital One Spark Miles Select Rewards||$0||50% bonus on all miles earned annually|
|Capital One Venture Rewards||$59 after first year||2 miles per dollar, excellent credit|
|Capital One VentureOne Rewards||$0||1.25 miles per dollar, excellent credit|
|British Airways Visa Signature from Chase||$95||EMV-compatible|
|Fairmont Visa Signature from Chase||$95 after first year||5/2/1 point model (5 points for every dollar spent for Fairmont stays; 2 points for every dollar spent on travel; 1 point for every dollar on all other purchases)|
|Hyatt Card from Chase||$75||3 points for every dollar spent at Hyatt, 1 point for all other purchases|
|Chase Ink Bold||$95 after first year||5/2/1 point model (5 points for every dollar spent for Fairmont stays; 2 points for every dollar spent on travel; 1 point for every dollar on all other purchases)|
|J.P. Morgan Select Card from Chase||$95 after first year||EMV-compatible; double points on travel purchases|
|Marriott Rewards Premier from Chase||$85 after first year||5/2/1 point model for Marriott stays|
|Priority Club Select Visa from Chase||$49 after first year||5/2/1 point model for Prioity Club stays|
|Ritz-Carlton Rewards card from Chase||$395||5/2/1 point model for Ritz-Carlton stays, Lounge Club access, $200 annual credit for airline fees|
|Chase Sapphire Preferred||$95 after first year||7% dividend on all new points earned|
|United Mileage Plus Club Card from Chase||$395||1.5 miles per dollar, 2 miles per dollar for United purchases, Premier Access priority airport services|
|Citi Executive/AAdvantage WorldElite MasterCard||$450||Admirals Club membership, priority check-in, airport screening, boarding, first bag free|
|Citi ThankYou Premier||$125 after first year||1 point for every dollar; annual complimentary domestic companion ticket|
|Citi ThankYou Prestige||$500||EMV-compatible, 1.3 points per dollar|
|Discover Open Road||$0||2% cash back on first $250 gas purchases in billing period, limited international acceptance|
|Escape by Discover||$60||Double miles on every purchase, limited international acceptance|
|Miles by Discover||$0||Double miles on travel and restaurants, limited international acceptance|
|Discover More||$0||5% cash-back bonus on varying categories, limited international acceptance|
|Discover Motiva||$0||5% cash back on interest charges for on-time payments, limited international acceptance|
|Discover Student More||$0||5% cash-back bonus on varying categories, limited international acceptance|
|Discover Student Open Road||$0||Cash-back bonuses, limited international acceptance|
|FNBO Graphite American Express||$99 after first year||3% cash back on airlines, 2% cash back on gas and groceries, 1% cash back on all other qualifying purchases|
|PenFed Platinum Cash Rewards||$0||5% cash back on gas, 0.25% on other purchases|
|PenFed Platinum Rewards Visa||$0||5 points on gas, 3 points on groceries, 1 point all other purchases|
|PenFed Premium Travel Rewards American Express||$0||Airport club access when you spend $15,000 annually|
|PenFed Promise||$0||No fees of any kind|
|PenFed Visa Gold||$0||NA|
The original article can be found at CardRatings.com:
36 top credit cards without foreign transaction fees