Credit card use in foreign countries
Foreign credit card use
One of the best ways to pass these long, cold, January evenings is to leaf through summer vacation brochures, or visit websites that promote wonderfully exotic locations. However, if you’re thinking of leaving the United States, you should bear in mind some issues that could arise when you come to use your credit cards.
These aren’t serious or insurmountably difficult, so don’t let them put you off booking something adventurous and really exciting. But things may go more smoothly (and affordably) if you plan ahead.
Credit card companies don’t travel well
One of the biggest problems you could face is your credit card companies assuming that the charges you make when you’re overseas are fraudulent. To be fair, more sophisticated criminals often do conduct overseas transactions when they misappropriate or clone a card, so it’s only sensible for banks and other issuers to treat unusual foreign activity with suspicion.
But the last thing you need when you’re settling a restaurant check or hotel bill, or when you’re filling up your rental car with gas, is for your card to be declined because your issuer has put it on hold. There’s no way of completely eliminating the risk of this, but you can drastically reduce it by giving your credit card companies details of your trip (when and where you’re going) before you leave, according to a Wall Street Journal report.
Credit card technologies not always compatible
Many parts of the first world have already adopted “chip and pin” credit card authorization technologies, which aren’t 100 percent compatible with the U.S. system. Usually, this shouldn’t be a problem because merchants everywhere should be able to swipe an American card.
However, in less touristy areas you could find the odd waiter or check-out person who doesn’t know the correct procedure, and who isn’t too interested in finding out. You may also encounter self-service machines (train ticket dispensers, automated toll booths, unattended gas pumps and so on) where your card won’t work. One way of avoiding these issues is to carry more cash than you normally would.
Credit card fees
Many credit card companies are likely to stiff you at least two or three percent of the transaction value every time you swipe American plastic overseas. However, an increasing number of others don’t. For example, both Citi and Chase have both recently introduced products that don’t charge them, according to a report in Budget Travel magazine.
Check with your issuer well before you fly to see whether it imposes these, and consider applying for a different card if it does. Obviously, don’t bother doing so if you’re going for a Big Mac just across the Canadian border, but if you’re planning to spend a month at the Burj Al Arab hotel in Dubai you could save a tidy sum.
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