Capital One foreign transaction fee changes

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Capital
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Joined: Thu Jun 16, 2011 9:13 pm
Location: Vancouver, British Columbia

Postby Capital » Fri Jul 29, 2011 1:27 pm

bonoz wrote:Thanks for responding. That 1%, is that something separate you see on your statement? or is it just part of the exchange rate?


When I last traveled abroad in Europe, I used my BoA VISA debit card to get local currency (which waives even the 1% interchange fee as long as you use it at participating ATMs). When I used my MC debit card in Canada recently, the 'foreign transaction fee' was itemized separate of my purchase on my statement. Generally, my understanding is that the interchange fee is included in the 'exchange rate'. There are some fees that you pay to VISA/MC (e.g. 'interchange fees') then there are some fees you pay to your issuing bank (e.g. 'foreign transaction fees'). Since VISA/MC process the transaction, they decide the exchange rate you get and generally tack on their 1% fee to your purchase total (in my experience). It should also be noted that almost no individual ever gets the actual going exchange rate. The exchange rates that you see on the financial tickers are reserved for bank-to-bank, not bank-to-customer transactions. This would be akin to having a CC at the prime rate (the rate at which banks borrow money from the fed, currently 3.25%).


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