7 ways to avoid sneaky bank charges when you’re overseas

Between ATM fees and credit card markups, you’re probably wasting cash every time you shop overseas. Here are some helpful ways to stretch your dollar.

ATM machine
  • Syafii Ghazali
  • January 2020

If you’re a frequent flier, you’ll be surprised by how much extra fees you incur when you use your debit or credit card overseas. Well, arm yourself with these tips and make huge savings in the long run.

1. Be smart about ATM withdrawals

Whenever possible, use an ATM that’s owned by your bank or a partner bank to avoid paying withdrawal fees when you’re abroad (for example, POSB/DBS customers from Singapore can use all Westpac Group ATMs in Australia for free). If this isn’t possible, consider withdrawing larger amounts each time — fewer visits to the ATM means fewer unnecessary fees.

2. Get a credit card with a low foreign transaction fee ...

Most credit cards charge a foreign transaction fee so you’ll be paying your bank an extra two to four percent every time you shop overseas. This can quickly add up, so get a card with a low rate if you travel often. Some countries like Australia even offer cards with no international transaction fees at all.

3. … Or one that rewards overseas spending

There’s more to travel credit cards than frequent flyer miles. Some offer generous cash rebates and reward points for overseas spending while others give you rebates for hotel and flight bookings.

READ MORE: The important things most people forget to do before they travel opens in new window

4. Always make payments in the local currency

When you use a credit card at a shop or restaurant, they may ask you which currency you’d like to pay in — your home currency or the local currency. Always pick the latter. If you choose your home currency, you’ll get hit with a conversion fee on top of your bill. This tip also applies when withdrawing cash from an overseas ATM.

5. Get a multi-currency debit card

These are debit cards that can hold multiple currencies so you don’t have to pay hefty exchange fees. But what if you don’t have the right currency in your account? Some, like the TransferWise Debit Card opens in new window, will automatically convert the currency in your account with the lowest conversion fee. Handily, the card also lets you withdraw up to SGD $300 from an overseas ATM without having to pay any fees.

6. Pick the right money changer

Of all the possible ways to get foreign currency, money changers are the least favourable because the exchange rates offered are usually higher than what you can get from banks (yup, even those that claim they don’t charge commission — the fees are hidden in the inflated rate). But if you don’t have a choice, find a touristy area with lots of competition among money changers and go with the one with the best rate.

7. Join airline clubs

Many airlines offer membership programmes with money-saving perks. For example, Club Jetstar members get discounts, early access to sales and 20% off checked baggage and seat selection. It’s just SGD $48 for an annual subscription, so you stand to save big time. Click here opens in new window for full details.