After having a splendid international holiday, one may get a rude shock after going through the credit card bill as it heavily differs from the amount what you had calculated, especially if you are not in tune with the charges on credit cards spent abroad.
There are some not so friendly charges levied by banks when credit card is used abroad.
Here are few things to consider before travel abroad and before planning your expenses on a credit card.
1) Currency Conversion Fee
As you own a Indian credit card, the banks and institution of Visa and MasterCard automatically may charge around 1-2% on foreign exchange.
Also read:5 Best Credit Cards With No Annual Fees
2) Foreign Transaction Fee
The card providers will charge around 2.5 -3.5 per cent on the transaction amount, irrespective of the currency.
3) Cash Advances fee
Cash advances are very expensive even in India. Withdrawing abroad will definitely be higher. There can be a charge around 1-4 per cent every time you carry out cash withdrawal. However, it will be in addition to local cash withdrawal charges.
4) Currency Conversion date
Conversion date may not be necessarily the date which you made purchase. It depends on the merchant on which day the transaction is posted. It may vary with one or two days. So, when you calculate your payment amount it may vary with billed amount due to different dates and respective currency fluctuations.
Also read: 6 Wrong Ways of Using your Credit Card
Considering all the above points, you may have to pay additional of 5-6 per cent on your actual amount spent. Therefore, one should be aware of all the cost and charges involved before going for it.
If you are a frequent flyer, buy a credit card which suits your lifestyle and avail discounts on airfare and many more.