The real cost of foreign travel websites

The real cost of foreign travel websites

Armed with a credit card and a dream, booking your next holiday couldn’t be simpler with online travel websites now bringing bargain deals into your own living room.  

But, the real cost of booking your dream holiday could have a sting in the tail, particularly if you book using foreign travel sites.

A RateCity study revealed that over 97 percent of 189 credit cards incur a currency conversion fee, also known as an ‘international transaction fee’, on transactions made with overseas merchants or paid in a foreign currency.

Australians are not required to be notified about the extra charge at the time of their holiday booking, leaving most consumers reeling when they discover a currency conversion fee lurking on their next bank statement.

So what’s the impact of ‘.com’ versus ‘’ websites to your bottom dollar?

What is a currency conversion fee?

A currency conversion fee is charged by your bank for all transactions made in a currency other than Australian dollars — or in AUD. But with an overseas merchant, the fee is charged as a percentage of the converted AUD amount shown on your bank statement. For example, if you were charged $2000 Australian dollars, which was converted by your bank from another currency, and your bank charges a 2.8 percent fee for the conversion, you will incur an extra $56 on top of your travel costs.

RateCity data shows an average conversion fee of 2.81 percent is applied across most credit cards, with a maximum fee of 3.65 percent.

Conversion fees differ from banks and card merchants, such as MasterCard, Visa and American Express – so check with your financial institution to find out how much you will be charged.

Alex Parsons, CEO of RateCity, said, “Since travel deals moved from flight agency offices to online it’s become substantially easier to take control of your own travel plans. But I’d urge travellers to do your homework on fees and charges to make sure you’re getting a great deal.”

It’s important to note that these fees don’t stop once you have reached your holiday destination. International transaction fees can be applied each time you withdraw money from an overseas ATM or use your credit to pay for purchases with an international merchant.

The real currency conversion rate

If you are booking directly with a foreign travel site, be aware not just of the fees, but, the ‘real’ currency conversion rate.

“First, check that your quote is in Australian dollars, because if not it could end up costing you more than a local travel deal site,” Parsons added.

“There are plenty of currency conversion tools online that can quickly convert a foreign currency into Australian dollars by pulling real-time currency data, so check the exchange rate before committing to the deal,” he said.

Travel money options explained

Some credit card providers are resisting the trend and ditching the currency conversion fees altogether.

Not all credit cards have fees for currency conversion, so it pays to shop around before you start swiping the plastic.

GE Money’s 28 Degrees Mastercard, Aussie’s Low Rate Platinum cards and Bankwest’s Breeze Platinum MasterCard, Zero Platinum MasterCard and More Platinum MasterCard, each offer cards with zero currency conversion fees (at the time of writing).

But be aware that while they charge zero currency conversion fees most still charge other international fees, such as international ATM cash withdrawal fees.

”Always look at comparing credit cards and look at the complete picture, by factoring in interest rates and other fees, to make sure you are getting the most value out of your card,” Parsons said.

A cash passport is another alternative to a credit card and allows travellers to buy online without currency conversion fees, because they can be loaded with foreign currency. 

But these are not without fees. Some cards incur applicable fees and charges, including reload fees and inactivity fees, so it pays to check whether this is the most cost effective option for you.

Currency conversion fees can still apply on cash passports if you make a purchase on a foreign website in a currency not loaded on your card or you have insufficient funds to complete the transaction. These fees may also apply to purchases made while overseas – so make sure you read the product disclosure statement.


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Learn more about credit cards

What does ANZ credit card insurance cover?

ANZ offers complimentary insurance on some of its credit cards, which can provide some protection against unforeseeable incidents, like the theft of your card. Depending on the type of credit card you own, you may be eligible for different insurances. For instance, most ANZ credit card customers may qualify for Purchase Protection Insurance and Extended Warranty Insurance. Customers who own premium credit cards may also be eligible for Guaranteed Pricing, Rental Vehicle Excess, International Travel, and so on.

Consider checking your ANZ credit card insurance features listed in the Insurance Policy Information booklet to know which items are covered. Also, while ANZ issued the credit card, they are not the insurer. For this reason, you may need to send your insurance claims - and get your ANZ credit card insurance refund - to the insurance provider.

How do I apply for a credit card online?

Monthly repayment

This is how much you can afford to pay on a monthly basis off your credit card. You can enter any amount you wish; but to make the balance transfer worthwhile the default is $200.

Current Annual Fees

These are the current annual fees on your existing credit card.

Should I get a credit card?

Once you've compared credit card interest rates and deals and found the right card for you, the actual process of getting a credit card is quite straightforward. You can apply for a credit card online, over the phone or in person at a bank branch. 

Current Interest Rate

This is the current interest rate on your existing credit card.

Increase your credit card limit with Westpac

A credit card can be a useful tool to access extra cash when you need it. Sometimes you may wish to increase your credit card limit for greater financial flexibility. For example, to realize your immediate goals faster, such as planning for an international holiday or making a big purchase.

You can apply to increase your credit limit at any time, and most credit card providers have made it really easy to do so. You can use your online banking portal, the credit card provider’s mobile app, or even the telephone. 

Applying online to increase your credit limit with Westpac is the easiest option if you’ve already activated Westpac Live Online Banking. All you need to do is fill in the required information and then hit ‘submit’ to apply for an increase in your credit card limit.

Most banks will ask for details of your financial situation at the time of applying for a credit increase. This is done to ensure your new limit meets the lender’s criteria. 

You can apply for increasing your credit limit in any of the following ways:

  1. Visiting your nearest Westpac branch
  2. Calling Westpac on 1300 651 089
  3. Logging in on Westpac Live Online Banking

Can a pensioner get a credit card?

It is possible to get a credit card as a pensioner. There are some factors to keep in mind, including:

  • Annual income. Look for credit cards with minimum annual income requirements you can meet. 
  • Annual fees. If high fees are a concern for you, opt for a card with a low or $0 annual fee. 
  • Interest rate. Make sure you won’t have any nasty surprises on your credit card bill. Compare cards with a low interest rates to minimise risk.

How to make a credit card online

If you’re wondering about how to make a credit card online application, here are some steps to follow:

  • Test the market. Many credit card options are available online. Compare providers by fees, interest and perks to ensure you’re getting the best deal.
  • Complete the application. Once you’ve selected a card, head to the provider’s website and complete the online credit card application form. Forms vary by providers.
  • Provide details. Most cards require you to meet age, residency, income and credit status condition, and you need to provide details like a bank account statement to prove this.
  • Review details. Ensure the information you’ve entered is correct.

How to get a credit card for the first time

A credit card can be a useful financial tool, provided you understand the risks and can meet repayment obligations.

If you’re a credit card first-timer, review your options. Think about what kind of credit card would suit your lifestyle, and compare providers by fees, perks and repayments.

Once you’ve selected a card, it’s time to apply. Credit card applications can generally be completed in store, online or over the phone.

When you apply for a credit card for the first time, you must meet age, residency and income requirements. As proof, you must also provide documentation such as bank account statements.

How to get money from a credit card

You can get money from a credit card, but generally it will cost you.

Withdrawing money from a credit card is called a cash advance, as it operates more as a loan than a simple cash withdrawal. Because it is a loan, you may be charged interest on your cash advance as soon as you make the withdrawal. Interest rates are also usually much higher for cash advances than standard credit card purchases.

In addition to the interest rate, you may also be charged a cash advance fee. This could be a flat rate, or a percentage of your total cash advance. If you are considering a cash advance, make sure to add up how much it will cost you before committing.

How do you use credit cards?

A credit card can be an easy way to make purchases online, in person or over the phone. When used properly, a credit card can even help you manage your cash flow. But before applying for a credit card, it’s good to know how they work. A credit card is essentially a personal line of credit which lets you buy things and pay for them later. As a card holder, you’ll be given a credit limit and (potentially) charged interest on the money the bank lends you. At the end of each billing period, the bank will send you a statement which shows your outstanding balance and the minimum amount you need to pay back. If you don’t pay back the full balance amount, the bank will begin charging you interest.

How do you cancel a credit card?

It’s important to cancel your old cards to avoid any additional fees. Unless you’re doing a balance transfer, you’ll need to pay the outstanding balance before you cancel your credit card. If you’ve opted for a card with reward points, make sure you redeem or transfer the points before you close your account. To avoid any bounced payments and save yourself an admin headache, redirect all your direct debits to a new card or account. Once you’ve done all the preparation, call your bank or credit card provider to get the cancellation underway. Once you receive a confirmation letter, destroy your card and make sure the numbers aren’t legible.

Where can I get a credit card?

Looking to get your first credit card? You might be confused as to exactly where to go to apply for one. Here’s where to go when you are ready to put in that application.

The bank: Your bank is a great place to start, provided that you have a good banking history. Since you already have a financial history, you have more chance of your application being approved.

Credit card provider: Another option is to apply for a credit card directly from the issuer, such as Visa, Mastercard or Amex. This will most likely be an online application, so do your research and apply for a suitable card for your circumstances.

Major retailers: Coles, Woolworths, Myer and David Jones all have credit cards available. But watch out for the interest rate and annual fees – these cards are designed to help you spend more in store.