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So now the there is a cash back for credit card consumer
Using a credit card on vacation abroad is convenient and rewarding, often giving consumers cash back or airline miles.
But there's a hidden cost: as much as a 10% markup on all transactions. The little-known cost is due to two things: foreign-transaction fees and dynamic currency conversion fees.
A foreign-transaction fee is commonly assessed by credit-card companies when Americans make purchases outside the U.S. -- about 2% to 3% of the total. To keep costs down while traveling, it may be worth applying for a no-foreign-transaction-fee credit card before you go. Capital One(COF) offers the most number of these types of credit cards.
Dynamic currency conversion, on the other hand, is a strategy that merchants use to make extra money on electronic transactions made by travelers. They offer to convert your transaction into your home currency but, in doing so, charge a fee as high as 7% of the purchase and pocket the difference. That can be easily avoided by simply insisting that your transactions are paid in the local currency. Source
Using a credit card on vacation abroad is convenient and rewarding, often giving consumers cash back or airline miles.
But there's a hidden cost: as much as a 10% markup on all transactions. The little-known cost is due to two things: foreign-transaction fees and dynamic currency conversion fees.
A foreign-transaction fee is commonly assessed by credit-card companies when Americans make purchases outside the U.S. -- about 2% to 3% of the total. To keep costs down while traveling, it may be worth applying for a no-foreign-transaction-fee credit card before you go. Capital One(COF) offers the most number of these types of credit cards.
Dynamic currency conversion, on the other hand, is a strategy that merchants use to make extra money on electronic transactions made by travelers. They offer to convert your transaction into your home currency but, in doing so, charge a fee as high as 7% of the purchase and pocket the difference. That can be easily avoided by simply insisting that your transactions are paid in the local currency. Source
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