It’s easy to chip away at your spending money when travelling overseas. Aside from unexpected expenses popping up, there are plenty of fees associated with overseas spending that can quickly cut into your budget.
The good news is that with some planning and research, you can reduce or even eliminate overseas EFTPOS fees and other international fees, so you can put your money towards having a good trip.
What is an overseas EFTPOS fee?
An overseas EFTPOS fee is also known as a ‘foreign transaction fee’, an ‘international transaction fee’ or an ‘overseas transaction fee’.
This is an extra charge that you incur when you use a debit card linked to your everyday bank account to make a purchase at an EFTPOS terminal overseas.
For example, if you use your debit card to buy a souvenir in a store in another country, you can be charged extra by your bank for making the transaction. The fee is usually a set dollar amount or a percentage of the total purchase price.
While most banks charge a fee for overseas transactions, some debit cards come with low or no overseas EFTPOS fees. However, debit cards with no overseas EFTPOS fee can still come with other international fees.
Other types of international fees
Along with overseas EFTPOS fees, there are certain other types of fees you can be charged for spending or withdrawing money overseas:
- ATM withdrawal fee – You can be charged twice for withdrawing cash at an overseas ATM using a debit or credit card – once by your bank and once by the foreign ATM provider.
- Currency conversion fee – Currency conversion fees can be charged when you use a travel card, credit card or debit card. You’ll usually incur a fee if you pay for something in a currency foreign to the default currency on your card (Australian dollars).
- Merchant fee – Some overseas merchants add a surcharge to transactions for using an overseas card, however this applies only to credit cards.
- Money exchange fee – If you buy foreign money, the exchange desk or money changer may charge a money exchange fee or give you a lower exchange rate so they can make a profit.
- Cash advance fee – If you’re using a credit card, you’ll incur a cash advance fee each time you make an ATM withdrawal.
Tips for avoiding fees when travelling overseas
Although it’s difficult to avoid fees altogether when travelling, you can minimise how much you pay. Here are some simple tips:
Choose a card with no EFTPOS fees or ATM withdrawal fees
Some bank accounts come with debit cards with no overseas transaction fees or ATM withdrawal fees. Compare bank accounts to see what’s available.
Withdraw money from partner ATMs
Some banks have a network of global alliance partners that allow you to withdraw money from their ATMs for free. Keep an eye out for your bank’s global ATM partners.
Make charges to your card in Australian dollars
Some merchants allow you to make EFTPOS transactions in Australian dollars. By doing so, you may be able to avoid a currency conversion fee.
Limit withdrawals and transactions
If your bank charges fees as a set dollar amount, rather than a percentage of the total amount, spending or withdrawing money in bulk means you’ll have to pay the base fee less often.
Nick Bendel is RateCity’s property and personal finance editor, and covers property, loans, credit cards, superannuation, and other bank products. Nick has previously written for The Adviser, Mortgage Business, Smart Property Investment, Elite Agent, Lifehacker, Business Insider, Yahoo Finance, and InvestorDaily, and loves getting elbow-deep in the latest ABS, APRA and RBA data.