Travelling Overseas? Credit Cards with Zero Foreign Transaction Fees

Can you use Credit Cards Abroad?

Absolutely! Since there’s a limit on cash that we can carry abroad, more and more credit card issuers are offering attractive schemes to people. Those who want a credit card for their trip abroad opt for these cards. 

Moreover, they can also use these credit cards to make international payments online. However, most of these credit cards have some price attached to them. This has been discussed in the next segment.

What is Foreign Transaction Fee?

Every time you make a payment abroad, your bank and credit card network charges a fee towards this conversion. This fee is called a foreign transaction fee on credit cards.

For most credit card networks such as MasterCard and Visa, this fee is usually 1% of the transaction amount. Credit card issuers may charge anywhere between 1% and 3% as their mark-up fee.

You can be charged anywhere from 1% to 3% of the total transaction value depending on your credit card issuer. 

This means, if you spend USD 1000 on a single transaction, then with a 2% foreign transaction fee you will be charged USD 20 extra. These costs should be considered before selecting any card as they can amount to a considerable sum.

Are there Any Zero Foreign Transaction Credit Cards in India?

With so many options available, many people go for credit cards for hassle-free payments while they’re abroad. Most credit cards available in India have some foreign transaction fee (foreign currency mark-up fees) for every transaction. Considering the burden this can increase on travellers, many banks have come up with special credit cards with zero forex markup.

Take a look at some credit cards in India with no foreign currency markup fees:

RBL World Safari Credit Card

RBL Bank World Safari Credit Card is among the top choices among no foreign transaction fee credit cards. It offers a vivid travel experience thanks to its 0% markup fee on all foreign transactions. Compared to other credit cards, travellers can save anywhere from 2-4% on all their foreign currency transactions.

The card comes with a voucher worth Rs. 3000 and travellers earn travel points on all their spending. These points can be redeemed for hotel and flight bookings.

The card also offers several milestone benefits depending on the amount spent. Also offers complimentary travel insurance with coverage for trip delays, personal liability, passport loss, baggage loss and dental treatment.

Fee: Annual membership fee of Rs. 3000 + GST

Key Benefits: Complimentary Priority Pass membership, 2 complimentary domestic lounge access every quarter, Golf privileges, fuel surcharge waiver, and more.

Club Vistara IndusInd Bank Explorer Credit Card

Described as a card laden with privileges, rewards, and luxury, Club Vistara IndusInd Bank Explorer Credit Card is another card with zero foreign currency mark-up on all international transactions. Upon payment of the joining fee, users will receive gift vouchers worth Rs. 25,000, a Luxe Gift Card, and a lot more.

The card comes with a complimentary Club Vistara Gold Membership with benefits like priority check-in, additional baggage allowance and priority boarding.

Joining Fee: Rs 40,000

Annual Fee: Rs. 10,000

Key Benefits: Credit card with zero forex charges, complimentary business class ticket voucher, 20% discount on Airport Fast Track, contactless credit card features,

Axis Burgundy Private

Targeted at the ultra HNI Indians, the Axis Burgundy Private Credit Card (The One Card) has been recently launched to cater to a segment of customers. The card is available for its private banking customers and offers a plethora of transaction benefits including zero forex mark-up on international payments and no cash withdrawal charges.

This credit card with zero forex charges also offers several lifestyles and entertainment benefits such as 24X7 concierge services, 50 complimentary rounds of golf, unlimited lounge access, complimentary hotel and dining memberships, and more. 

It also offers travel insurance with air accident cover up to Rs. 4.5 crore along with lost card liability and purchase protection.

Eligibility: Only those with a Burgundy Private Savings Account can avail of this benefit. A minimum TRV of Rs. 5 crores is required.

Joining/Annual Fee: N/A (Rs. 50,000 if the customer downgrades their account)

Key Benefits: No foreign transaction fee credit card with golf benefits, health and wellness offers, unlimited lounge access (international and domestic), and more.

Why Should You Check Foreign Transaction Fees Before Buying an International Credit Card?

A foreign transaction fee is usually in the form of a percentage and is assessed by the card issuer. If your fee is 3%, then you will need to pay that on every transaction.

To help you understand why you should check a card’s foreign transaction fee, consider this example:

Suppose you shop on international sites a lot, then credit cards with foreign transaction fees will cost you considerably as you'll need to pay that percentage on top of your spending every time. On every Rs. 1000 spent, you will need to pay an additional amount of Rs. 30.

In such a case, finding a card with the lowest or zero forex markup will save you a lot of money. If you buy a card with a high foreign transaction fee, then it can cost you anywhere from 2 to 4% extra per transaction.

Buying Credit Card for Trip Abroad: Things to Remember

Credit cards are great for international trips; you can carry as much money as you want without worrying about exchanging or losing it. However, make sure to keep these points in your mind to find the right credit card for your trip abroad:

• Most credit cards impose a foreign transaction fee every time you use your card overseas or pay a foreign merchant.
• This fee varies from the card issuer, so you should always compare different credit cards before going for it.
• Online purchases from overseas vendors can also charge foreign transaction fees so opt for a card with zero forex markup.
• There is a difference between foreign transaction charges and currency conversion fees, so you must be aware of how much each of them consists of.

Wrapping it Up,

Travelling abroad is no short of an adventure. To successfully plan any foreign trip, money is perhaps the biggest concern while travelling abroad. Even before reaching your destination, plenty of things need to be considered and taken care of, including finding a no foreign transaction fee credit card with zero forex markup. While credit cards offer a great solution to the hassles of carrying money securely, don’t forget to buy international travel insurance plan to ensure a safe trip. This will ensure that you never exceed your savings or get into financial travel whenever you are abroad!