Forget credit cards for international travel and find a good debit card!

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In an ideal world, I would use one of my no foreign transaction fee credit cards for all purchases internationally and rack up major points with spending abroad.  In reality, almost all countries in the world are more cash-centric than the US so in some situations using credit cards overseas is simply not an option.

Even when the option exists to use credit cards abroad, I strongly prefer to use cash for everything but major purchases because I know most restaurants, small shops, and food stands are run as small businesses who lose out on precious margins when the credit card company is taking a cut out of the purchase.

You can greatly reduce or eliminate the fees you pay on ATM local currency cash withdrawals by carrying a good debit card. On my most recent trip through Germany, Czech Republic, Austria, and Hungary, I took out money from several ATMs scattered across the various countries and did not pay a single fee.

While many good debit options exist, I want to highlight three strong debit card options which can be useful when traveling internationally.

Bank of America Checking (member of the Global ATM Alliance)

The Global ATM Alliance is a great friend for obtaining cash abroad and avoiding those nasty ATM fees.  As a Bank of America debit card holder, I have access to each of the Alliance member bank’s ATM network in the country listed below with absolutely no fees.

The following banks are members of the Global ATM Alliance.

  • Bank of America (United States)
  • Barclays (United Kingdom, France, Spain, Portugal, Pakistan, Gibraltar, Ghana, Kenya, and other countries in Africa)
  • BNP Paribas (France)
  • BNP Paribas Fortis (Belgium)
  • BNL d’Italia (Italy)
  • Deutsche Bank (Germany, Poland, Belgium, India, Spain and Portugal)
  • China Construction Bank (China – Mainland Only)
  • Scotiabank (Canada, Caribbean, Peru, Chile and Mexico)
  • Westpac (Australia, New Zealand, Fiji, Vanuatu, Cook Islands, Samoa, Tonga, Papua New Guinea and Solomon Islands)
    • Westpac Banking Corporation (Australia, Fiji, Cook Islands, Solomon Islands, and Vanuatu)
    • Westpac New Zealand Limited (New Zealand)
    • Westpac Bank – PNG – Limited (Papua New Guinea)
    • Westpac Bank Samoa Limited (Samoa)
    • Westpac Bank of Tonga (Tonga)
  • ABSA (South Africa)
  • UkrSibbank (Ukraine)

I don’t see a formal Global ATM Alliance website but wikipedia does a good a job here explaining all the terms and conditions.  This is valid only for the country listed, so for instance, you would be charged no fee for using a BNP Paribas ATM in France but you would be charged for using one of their ATM’s in Denmark.

In the last few years, I can confirm using my Bank of America debit card at alliance banks in Australia (Westpac), Canada (ScotiaBank), South Africa (ABSA), Germany (Deutsche Bank), Peru (Scotiabank), and Chile (Scotiabank).  When traveling with friends or family, I always offer to take out all the cash for the group so I can spare them those extra fees.  Being an over-analyst, I calculated all transactions and found I was always charged the daily exchange rate and no additional fees.

There are various types of eligible Checking accounts from BOA.

Capital One 360 Checking (Formerly ING Direct Electric Orange)

  1. Capital One 360 Checking / Savings Account (Earn $50 through my referral link)

We have seen a positive trend lately from newly launched credit card products choosing to eliminate pesky foreign transaction fees which are generally a small percentage for using a card outside the US. The same can’t be said for debit card products.

For years I have been using a no-fee ING Direct Electric Orange checking account as my primary checking account which includes the ability to mail checks electronically and an ING Direct debit MasterCard. I don’t have the same motivation to jump around checking accounts for promotions and signup bonuses as I do with credit cards because of the higher switching costs (time!) involved. ING Direct (and now Capital One) has been good to me so I stick with them.

As part of a restructuring agreement of the Dutch financial behemoth ING Group, the company was forced to sell off ING Direct which was picked up by Capital One. One of the very first changes Capital One announced to its customers was that as of November 1st, 2012, the Capital One 360 debit card no longer charges any Foreign Transaction Fees. This used to be around 3% charge so for me this is a nice savings. The elimination of foreign transaction fees on the debit card means Capital One won’t charge a percentage of the total a customer takes out of the ATM abroad though the ATM itself may issue a surcharge which is generally a flat fee.

If you are in the market for a No Foreign Transaction Fee debit card, the 360 Checking account is currently offering a 50 USD signup bonus and my 20 USD referral link is here.

Schwab Checking

The Schwab checking account advertises unlimited fee rebates from any ATM worldwide and no foreign transaction fees. There are no minimums on the account but does require a link to a Schwab investment account which also does not currently have minimums. I am not a consumer of this product as I am the other two above so I can’t vouch for the product itself but it sounds like a great option for international travelers.

The bottom line

Credit cards are the best tool to rack up points for purchases but they often aren’t useful internationally.  I think it is far more important to have a good debit card that works when traveling abroad than a no foreign transaction fee credit card.

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Editorial Note: Opinions, analyses, reviews or suggestions expressed on this site are those of the author’s alone, and have not been reviewed, approved or otherwise endorsed by any card issuer. For details on current offers visit the card issuer’s site.

About alex

Alex loves to travel and does so a lot. Logging 100,000 flight miles each year over the past 4 years, Alex uses points and miles to power his passion. Alex is continuously striving to experience the far reaches of the globe. In his day job, Alex is a Management Consultant frequently on the road advising Technology organizations. I love thinking about, reading about, and talking about all things travel. Feel free to reach me at

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  1. PNC Select Plus $5,000 minimum average:
    Full refund of all ATM fees -no limit
    0% overseas transaction on ATM withdrawal
    2.5% on purchases

    Saved countless $$ on overseas ATM fees in Thailand and Easter Island.

  2. First Republic has no foreign transaction fees AND will refund you the ATM fee for using a different bank. Every time I travel abroad I use my First Republic ATM card. It even worked when I was in Burma last Spring!

  3. Does BofA charge forex fee, I thought it did.

    I believe CapitalOne 360 charges ATM fee. I recently switch from their Premier Reward Checking to their High Yield Checking to avoid ATM fees.

  4. @steve/alex L – Thanks! I will take a look at those offerings.

    @MichaelP/Frequent Flyer University – The wiki page of the Global Alliance states BofA still charges a 1-3% fee but I can confirm I was not charged that using the Global Alliance Banks on my most recent trip and all others previously. BofA has recently changed their posting of fees so it is explicit when you are charged a fee. Capital One 360 does not charge an ATM fee.

  5. Saying “using credit cards overseas is simply not an option” is misleading, if not flat-out incorrect

  6. Fidelity Cash Management Account has no fees and no minimums. I’ve been able to get the official rate everytime. I think there might be a 0.2% fee, but I don’t ever notice it.

  7. Schwab is great. I use it for all travel…both foreign and domestic. It is both a credit card and an ATM card. There is never a foreign transaction fee.

  8. Anyone consider the dangers of debit card fraud? Im not sure what consumer protections exist in the event that a nefarious merchant drains your checking account…

  9. Half your story makes sense……finding a good card to use at ATMs is a smart way to travel overseas as AMEX and Chase will eat you alive otherwise……….but to say that credit cards have limited value overseas is just PURE WACK!

  10. I love my Schwab card, only a few times have I had ATMs where the fee is not broken out so Schwab can’t see it and neither can I. These are pretty obscure, such as ATMs in Papua New Guinea, but there it is an accomplishment just to find one working and with cash.

  11. How do these cards do with the exchange rate they use? Are you getting the best exchange in addition to no fees or are they just using exchange rate variances to make up for the lack of fee?

  12. @Ari k/Traveller – If it were practical I would use my credit card each time for the added protection against fraud but in practice it is often impractical.

    @TTF – I am not certain of the formula but I know they take a snapshot against a forex rate on day or week intervals. I compare every time out of curiosity and have never seen any rate I deemed inflated in their favor.

  13. @Michael – I used my Capital One 360 at the Seven Bank ATMs which are affiliated with the 7-11 stores all over Japan. Last year I had no ATM fees and a true exchange rate in Kyoto and Tokyo. However, the wiki page for Seven Banks indicates they may have stopped accepting overseas Mastercards as of April 2013.

  14. I can vouch for the Charles Schwab card – it works as advertised. We have used it for international travel for a few years now, and we also use it for domestic travel where ATMs for our primary bank do not exist.

  15. Romsdeals… when using your ATM card from your Fidelity Cash Management Account overseas, they do not charge fees, but they do tack on 1% to the amount withdrawn – read the fine print. Might as well just use my B of A ATM at Global Alliance Network banks, they charge 1% as well.

    The big question in my mind is what RATE are you given in the foreign currency exchange? For example (using today’s rates, changes daily), today’s actual rate is 1.34. But if you buy Euros today at a bank, Bank of America gives you the rate of 1.4069, Wells Fargo rate is 1.4049. What rate are you given when using your ATM overseas, say at Global Alliance Network bank BNL d’Italia? Is it the actual rate of 1.34, or the B of A rate, or the BNL rate? Can someone answer this? It can be significant but nobody seems to be discussing this.

  16. In my question above, here’s the math. If withdraw 200 Euros from BNL d’Italia (a Global Alliance Network bank) while in Italy, the actual global rate exchange rate is $268 US dollars. At the BofA rate (1.4069 plus 1%), it would cost me $284.19, at the Wells Fargo rate (1.4049 plus 0%) it would cost me $280.98. I can’t seem to find what the BNL d’Italia rate would be. It would be great if it was the actual global exchange rate of 1.34, in that case it would cost me only $268.00. But I have a feeling that BNL probably uses their own rate similar to how BofA and Wells Fargo does.

    Essentially, the cost of the exchange is either $0, $12.98, or $16.19. These differences for only 200Euros/$268USD are huge. I suppose what it comes down to is finding out what exchange rate will be used at the ATM/bank when you withdraw money overseas.

  17. Just found out the rate that Schwab uses for their checking account: they use the Visa rate which is actually at the global foreign currency exchange rate for today, 1.34!!! That is incredibly great; haven’t found any other bank willing to give that rate. So I’m setting up a Schwab brokerage and checking account now, hoping I get my Schwab ATM card prior to my departure!

  18. BAnk of America was good like Alex posted on Aug 14th up UNTIL November the 12th 2013 or so. Now they charge 3% transaction fee. Don’t fall for the Safepass card. They don’t call it a transaction fee, but they have an ARBITRARY fee that charges total 4% !

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