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By: Ikedi Ani-okoye
When travelling abroad, using a credit card can get expensive. With the exception of one credit card Company, credit card companies charge a 3% international credit card transaction fee for all purchases developed outside the United States. This 3% fee is generally hidden in the fine print of your credit card terms, but unless you’re carrying a no transaction fee credit card, you’ll be paying extra for every buy you make.
One way to obviate paying international credit card fees is to use your debit card. While rules and fees vary from bank to bank, many national banks only charge a foreign currency conversion charge when you make a transaction. Unfortunately, there are a number of very major drawbacks to using your debit card to make purchases abroad. First, if someone steals your debit card info, your bank account may deplete before you realize it. This can lead to overdraft charges and other issues. Secondly, when your debit card is stolen, the funds that should be usable to you in your bank may not be usable for a substantial amount of time as the bank investigates your claims.
Clearly, this scenario could prove a nightmare. Imagine being stuck abroad with no useable cash and returning home to spend weeks waiting for funds to return to your bank account.
Avoiding this scenario through using a credit card is must do. If your credit card is used fraudulently, you can contest the charges immediately and the money in your bank remains safe. Of course, paying a 3% fee for international credit card usage can cause a problem. However, simply apply for a credit card that charges no foreign transaction fees and you obviate extra fees and prevent all the issues that can arise when you use your debit card.
In accession to charging no international transaction fees, the same credit card company offers high limit credit cards. High limit credit cards offer consumers credit limits in excess of ten thousand dollars and, in many cases, up to twenty five thousand dollars.
Travelling abroad without a no foreign fee credit card can be more costly and, in worst case situations, nightmarish. Using a debit card can obviously create some serious, time consuming and unnecessary financial headaches. Paying a 3% fee is generally worth avoiding the potential headaches, but because it is possible to avert this fee, the best option is to apply for a credit card that doesn’t charge a 3% international transaction fee.
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