Australians are being slugged with fees worth an estimated $535.8 million a year for using their credit and debit cards overseas, new research from RateCity.com.au shows.
In the 12 months to October, Aussie travellers paid an estimated $378.4 million in currency conversion fees and $157.4 million in international ATM fees. That’s a sharp rise since 2011, when the same fees cost a combined total of $334 million.
Sally Tindall, money editor at RateCity.com.au, said most travellers are being hit with at least three different fees, just by taking money out of the ATM.
“ATM fees can sting you from all sides, leaving customers significantly poorer before they’ve even turned their back on the machine,” she said.
“Most banks charge an international ATM fee of $5, plus a currency conversion fee of around 3 per cent. Then customers get hit with a fee from the local provider as well.
"Many of these foreign charges are avoidable by getting a low-fee card just for your holiday.”
Ratecity.com.au data shows there are eight credit and nine debit cards charging no currency conversion fee, and 47 debit cards with no international ATM fees charged by the provider.
“It's a no-brainer really; travellers can give money to their banks in the form of fees or they can put that money towards something more rewarding such as a meal in a local restaurant or shopping," she said.
“Limit your ATM withdrawals as much as possible and put purchases on your credit card instead. As long as you’re not using your credit card to withdraw money as a cash advance, they generally attract fewer fees.
“Another good option is to check with your bank to see if they have any affiliates in the areas where you are travelling. Often these partners will be free to withdraw money.
“Travel money cards can also be a cost effective option, if you can load them up with the currency of the country where you are travelling. These cards have a number of rules around them so it’s essential to be across the fine print.”
To find cards which have no ATM fees overseas – see the list here