Best card for travelling overseas?
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Discuss Best card for travelling overseas?, on the CitiBank Rewards Program forum of FrequentFlyer.com.au, the home of frequent flyers.
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The Citibank Visa and Mastercards are not equiped with a Chip. Chip and PIN technology has been implemented in the UK and Europe lately (2006) as a way of reducing fraud. Whilst most EFTPOS devices can handle both Magnetic strip (citibank) cards and CHIP, in many cases a PIN will be required.
The reader, who wishes to remain anonymous, says that a gold credit card from the NAB was rejected in a grocery store, two petrol stations and at lunch in a large chain of fish restaurants. The petrol stations, all part of a national chain, had the sign "No chip, no pin, no sale". Through internet forums there are other reports of cards being rejected in France, Denmark, The Netherlands and Switzerland.
Whilst there should be no problem in theory, you may have difficulty convinving the merchant that his payment will still be processed and we all know how temperamental the French can be!
ANZ is already using Chip and PIN, Westpac have decided to follow suit. NAB have indicated compliance (but will not reveal a date) and no comment from CBA.
Im afraid to say that there is a reason why the Citbank gold card is free. Not only is there no Chip, there are very high fees (Nearly 4%) for foreign currency transactions. Dont forget also that depending on which scheme (Mastercard or Visa) that the transaction is first converted into USD then converted into the local currency. The Scheme controls BOTH of these swaps and the exchnage rate that they give.
This problem is not seen as an issue with Australian banks for a couple of reasons
1) Foreign spend is less than 3% of total scheme spend for Australian issued cards (97% of spend is local AUD)
2) Skimming fraud is seen as manageable
3) The cost of change to Chip and PIN far outweighs the amount of fraud
In other words, youre being hung out to dry.
Happy trails
Nutcase
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for me, the Wizard Clear Advantage MC is the best value card for making purchases overseas!
i'll give you a current comparision Wizard Clear Vs. Anz Gold......
On 2 October 2007, I made 2 purchases online from American sites...so they charge in USD.
(According to the RBA website, on 2 October 2007, the $1aud was buying $0.8860USD)
On my Wizard card I put through $62USD and when converted to AUD it was $70.34 , this is about 0.88143.....
On my ANZ Gold Card, I put through $185.97USD and the amount I got charged was $215.40AUD (this includes a $5.25aud conversion fee)....
SO, $185.97USD = $215.40AUD , we are looking at 0.863370.
(ANZ Gold has a 2.5% conversion fee) so if you look at CB or Amex with a slightly higher conversion fee, I'm sure you know which one works out favourably!
(ANZ Gold has a 2.5% conversion fee) so if you look at CB or Amex with a slightly higher conversion fee, I'm sure you know which one works out favourably!
Actually Amex charges 2.5% currency conversion fee and I am almost certain that Citibank is the same but cannot confirm from the statement as it does not list the commission separately.
I am not sure that we will ever be able to reconcile the actual exchange rate used against any of the websites. Most credit cards do mention that they use a mixture of interbank rates and their own rates on the day prior to the transaction date.
So the only proof I have that Amex charges 2.5% commission on exchange rates is the commission amount that is reported on the statement, eg Hilton Mainz, €113 is converted to A$188.20 + A$4.70 commission fee (2.497%).
On a pure "transaction" basis, of course, you are right - however currency conversion isnt that simple. Given that Mastercard and Visa are setting the rates, the rate has a lot to do with their long and short positions on the day (and within the day)
Secondly, dont forget that different cards have differnt rules with regard to charge back. God forbid that you should need to use this facility, but if you did, you are going to be better off with an Amex compared with a Visa or Mastercard. Chargebacks happen if your goods dont arrive and you can have the merchant "charged back" for the item so you dont have to pay. Amex have a completely differnt regime with this and it works in the favour of the customer NOT the merchant, unlike the sheme cards. They also charge you if, after investigation, they find in favour of the merchant (in many cases)
There are also insurance products etc etc etc.
So no frills means no frills and you could get caught out. Wizard is a GE product and you are at the mercy of that company. Do you really think that Wizard are going to care about your fraudulent USD transaction and know how to handle it?
The reason why there are no foreign transaciton fees on a wizard card is that Wizard customers tend not to travel too extensively - Interesting that the other cards in the market are aimed at travellers. Yes they cost a bit, but you get what you pay for.
Then there is the "tip tray test". This is where you take your friends out for dinner and see the look of horror on their faces when you put down your lurid orange Wizard card to pay for dinner.
So, for the few bucks that you may be saving - Is it really worth it? By the looks of your investigation - it is for you but for me, peace of mind isnt worth the $100 a year ish (tax deductable) that you would save.
Therein is the rub. I believe XE rates are often specified in interbank contracts but the dates/times can vary.
Doesn't XE specify mid market rates? Again I am almost certain that credit card companies will use the lowest rate for that day. Where we get to see accurate interbank rates?
I had a lengthy discussion with an Amex customer service agent on this subject one time and I decided to give up in the end. Even he had no idea which rate is used and actually referred me to OANDA for comparison. But I was never able to reconcile using that website either. Who knows they are probably skimming on the exchange rate before applying the commission anyway. These days I am happy if the rate looks close enough.
Member of: QFF Gold, UA Prem., Skywards, SPG, MMarr
Posts: 78
Re: Best card for travelling overseas?
Quote:
Originally Posted by Nutcase
Careful!
Subsequently you will have difficulty using your Non Chip-PIN card in parts of Europe and the UK
Nutcase
I was caught earlier this year at an outlying Frankfurt train station (Langen - after a meeting with DFS [Deutsche Flugsicherung / German Air Traffic Control]) trying to use the automatic ticket vending machine. It would not take my NAB card as there was no chip, and the machine would not accept my 20 euro note as the fare was too small.
I was lucky there were two friendly people on the station, who between them found change of the e20 note, and then helped me interpret the machine.
Member of: QFF Gold, UA Prem., Skywards, SPG, MMarr
Posts: 78
Re: Best card for travelling overseas?
Quote:
Originally Posted by Nutcase
So, for the few bucks that you may be saving - Is it really worth it? By the looks of your investigation - it is for you but for me, peace of mind isnt worth the $100 a year ish (tax deductable) that you would save.
I agree, (after my wallet was stolen in Brussels), NAB had switched off the card and were replacing it with a new one, alerted by the fraudulent spending, before I had even reported it stolen. In fact, the NAB agent rang me to ask me where i wanted my card sent whilst i was standing at the counter of the police station waiting for the officer to record my claim.
As noted earlier, the Wizard card for fee free cash withdrawals is a good option.
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