2017 Charges for international ATM withdrawals and POS payments with your South African debit/credit card

Posted by Zaid January 27, 2015 14 Comments 38029 views

A few people have asked me what is the best method to make payments when travelling internationally or when purchasing items from an international website.

When I travel abroad I always try to carry some foreign currency notes. I also carry my debit and credit cards which I use to withdraw cash from foreign ATM’s or make POS (point of sale) purchases at foreign merchants. I decided to look at the rates that my bank and other South African banks charge for debit and credit card ATM withdrawals and POS purchases and I’m stunned by the high amounts.

The South African card providers charge different card administration rates and service fees. Some of your debit card rates are dependent on the account package and pricing option you selected from your local bank. There may be various perks included such as travel insurance, reward programs and air lounge access. If you are interested in the other fees I have provided a link to the 2017 pricing tables from each card provider.

Credit Card – International ATM Withdrawal Fees *

ABSA International ATM withdrawals is R50, currency conversion 2.75% Link
American Express Credit Card R40,00 plus R1,32 per R100,00 or part thereof + currency conversion fee (2%) Link
Bluebean R 35 + R2 per R100+ 2.75% conversion fee Link
Capitec Credit Card “R50 ATM withdrawal fee. MasterCard may charge a 0.2% currency conversion fee.

Capitec feedback: you are only charged the withdrawal fee the external bank will automatically convert the foreign currency rates for the specific day”

Link
Diners Club South Africa International (levied by foreign bank) R35.00 Base fee + R2.20 per R100 Link
Discovery Card R60 plus 1.85% of transaction value plus 2.75% conversion fee Link
FNB Gold and Premier Gold: R1.85 per R100 (minimum R60)  + 2.75% conversion fee

Premier: R60 + R1.85 per R100 + 2.75% conversion fee

Gold: Link

Premier: Link

Investec Just 2.5% conversion fee on Private Banking account Link
Nedbank R40,00 plus R1,40 per R100 plus 2% conversion fee Link
SAA Voyager Gold Credit Card R40 plus R1,40 per R100. plus 2% conversion fee Link
SAA Voyager Premium Credit Card R40,00 plus R1,40 per R100. plus 2% conversion fee Link
Standard Bank R 35 + R2 per R100 thereof+ 2.5% conversion fee Link
Virgin Money Credit Card R22.00 + 2.75% of transaction value Link


Credit Card – International POS payments currency conversion fees

* Some ATM operators may charge an additional fee or set their own limits

ABSA 2,75% Link
American Express 2% Link
Bluebean 2,75% Link
Capitec Credit Card Up to 0.2% (by MasterCard).

Capitec feedback: you are only charged the withdrawal fee the external bank will automatically convert the foreign currency rates for the specific day”

Link
Diners Club South Africa Foreign charges handling fee 2% Link
Discovery Card 2,75% Link
FNB Gold and Premier Credit Card 2,75% Gold: Link

Premier: Link

Investec 2,50% Link
Nedbank 2% Link
SAA Voyager Gold Credit Card 2% Link
SAA Voyager Premium Credit Card 2% Link
Standard Bank 2,5% Link
Virgin Money Credit Card 2,75% Link

If the indicative exchange rate for 1 US dollar is displayed as R14 for the day, if you swipe your card and are being charged 2% commission you are actually paying R14.28 for 1 US dollar. That is 28c more per dollar.

At 2,75% commission if the indicative exchange rate for 1 US dollar is R14 then you are actually paying R14.385, or 38.5c more per dollar. This is before any service fees may be added.

Debit / Cheque Card – International ATM Withdrawals *

ABSA R50. Global Alliance partners: R35,00. Currency conversion 2.75% Link
Capitec Global One Account R50 plus MasterCard may charge a 0.2% currency conversion fee.

Capitec feedback: you are only charged the withdrawal fee the external bank will automatically convert the foreign currency rates for the specific day”

Link
FNB Gold and Premier Gold: R50 + 2.75% conversion fee

Premier: R60 + R1.85 per R100 + 2.75% conversion fee

Gold: Link

Premier: Link

Nedbank  Professional and Debit Card R40,00 plus R1,40 per R100 or part thereof. International currency conversion fee 2% of transaction value Link
Standard Bank Elite and Prestige (nothing listed in Private Banking guide) International ATM R35,00 + R1.80 per R100 or part thereof of the transaction value plus 2.75% conversion fee Link

* Some ATM operators may charge an additional fee or set their own limits

Debit / Cheque Card – International POS payment fees and currency conversion fees

ABSA R2.65 / R3.85 (dependent on pricing plan) + currency conversion 2.75% Link
Capitec Global One Account MasterCard may charge a 0.2% currency conversion fee.

Capitec feedback: you are only charged the withdrawal fee the external bank will automatically convert the foreign currency rates for the specific day”

Link
FNB 2,75% Gold: Link

Premier: Link

Nedbank Cheque and Debit Card 2% Link
Standard Bank 2,75% (Note: 0.25% more than the credit card rate) Link

Unless you have told your card provider that you are travelling abroad they may put a block on the card due to “suspicious activity” if they see the card being used for an international transaction. This can be annoying if you are not roaming and the card provider cannot get hold of you to confirm the transaction.Debit and credit cards do offer convenience in allowing you to draw cash when you need it (particularly if it is a Visa or MasterCard branded card which is accepted in most countries). However, you are charged using the exchange rate of the particular day you perform the transaction on. Exchange rates fluctuate and you may not be know the exact amount you are paying.

Alternatives to credit and debit cards:

Prepaid cards / Travel Wallets

These are prepaid Visa or MasterCard debit cards that you load at home with foreign currency at a fixed exchange rate before you commence your trip. These cards may attract initiation, admin, reload, ATM withdrawal, POS purchase and commission / currency conversion fees. A limited number of currencies may be available on these cards.

Some of the providers:

Bidvest World Currency Card™ 

A pre-paid foreign currency card on Visa for 18 currencies.

Currency commission fee when loading the card 2.20%, min R72.00

Various fees apply (Card activation R150, card admin: R79 + VAT, Card Reload: Commission +admin fee).

Subsequent POS transaction fees abroad are free.

See ATM withdrawal and other fees here: Pricing

American Express Global Travel Card – No longer possible to reload after November 2016

In Conclusion:

Travellers Checks are also an option if you are going to a destination that has many exchange bureaus available for you to conveniently change your currency. I’ve never used travellers checks and I believe their usage is on the decline.

Debit and Credit cards are the most convenient, but you’re generally paying a price for that convenience. You should however always carry a debit or credit card in case of emergency. Prepaid travel cards are worth it if you want your conversion rate fixed and if you’re planning to spend above a specific amount where the lower currency conversion fees covers the card administration fees.

If you can, try opening a local bank account in the USA. You may just need a passport and proof of residence (in your foreign country) at a bank like Wells Fargo. Then make a SWIFT transfer of funds from your South African bank account to the US Account (I was charged 0.5% commission by Standard Bank), and use your US Credit card for purchases. The fees are much lower this way if you’re a frequent traveler.

At the end of the day you need to do a little homework to determine the best solution(s)  that suits you. Depending on where you are going and how much you plan to spend you should determine which solution(s) best meet your needs. I’ve listed some of the options available to you with my understanding of the pricing (you need to double check the pricing guides yourself and consult with your financial institution for their advice).

Travel Gadgets to consider

If you’re carrying cash, consider these locally available products that can reduce the risk of pick-pocketing / losing your items.

1. Wallet TrackR – Bluetooth 4.0 Device

Insert this little device into your wallet or other valuable items. You’ll be able to trace it with your phone if it’s within range of your phone (+-30m) or other people’s phones if they’re using the same tech.

TrackR

2. Landing Gear Passport Holder Neck Pouch With RFID

This is a lightweight wallet that you wear around your neck, and conceal behind your clothing. It has RFID protection to protect your credit cards from unwanted scans.

Landing-Gear-Passport-Holder-Neck-Pouch-With-RFID

3. Shacke Pocket Vault – Hidden Travel Belt Wallet w/ RFID Blocker

This is a secure pocket wallet which is almost invisible to thieves, and can’t be snatched away from you.

Shacke-Pocket-Vault-Hidden-Travel-Belt-Wallet-w-RFID-Blocker-Black-with-Black-Strap__51tTHkTeD3L
There’s quite a large variety of travel wallet options available. Click here to see more options.

 

Disclaimers:

I am not a financial adviser and I am not recommending any specific product(s). The information I’ve shared is all in the public domain (with links to the source pricing info). Remember that you need to comply with South African Exchange Control Regulations when dealing with foreign currency. Financial Institutions, if I have made any errors in my interpretation please advise. I will make the necessary corrections.

Image Credits: Credit cards by Sean Macentee under Creative Commons 2.0 license

There are 14 Comments

  1. Mike
    - February 27, 2015
      -   Reply

    Are the Capitec rates for real? It seems like they charge practically no currency conversion rates, and while there’s a R40 admin charge on withdrawals, there’s no fee on POS transactions?

    • - March 2, 2015
        -   Reply

      To my knowledge yes. I contacted Capitect about it last year, and checked their brochures in 2014 and 2015.
      If there’s a hidden charge then I wouldn’t know.

      • - March 19, 2015
          -   Reply

        Zaid, just wanted to ask if you know if Debit Mastercards Standard Bank have a POS charge internationally versus ATM fee?

        • - March 29, 2015
            -   Reply

          Hi Chris. I checked this pricing brochure: http://www.standardbank.co.za/standimg/South%20Africa/PDF/Pricing/Personal_Foreign_Exchange__Pricing.pdf
          It says “MasterCard point of sale (POS) fee (excluding currency conversion fee)” – Free.
          International MasterCard® and Cirrus ATM withdrawal fee** (excluding currency conversion fee) – Either USD 3.20, EUR 3.20, GBP 2.10 or AUD 4.70.
          Currency conversion fee is 2.5%/

          I am a little confused with the ATM withdrawal fee as the bundles cheque account pricing guide states “International ATM fee R33,00 + 1.40% of value”. I think that this refers to the blue debit card pricing, and “International MasterCard® and Cirrus ATM withdrawal fee” refers to the cheque card (gold / platinum)…

  2. Jack
    - March 12, 2015
      -   Reply

    Great! Many thanks
    Do you know what are the atm withdrawal limits of those banks?

    • - March 12, 2015
        -   Reply

      FNB $1000 limit, ABSA Cash passport $2500… you’d have to check with the institutions (it’s not easily visible on all the websites).
      Just note that the limits that you have on your card locally in SA may not apply internationally – you can generally withdraw much more than your SA limit. This can place you at risk of severe losses as a result of fraud.

  3. - June 27, 2015
      -   Reply

    Hi There Zaid.
    Thank you for this informative list, exactly what I am looking for for my USA trip next month.
    I am a Capitec client, but with the fast rising exchange rate, I’m sorely tempted to just get a fixed exchange rate debit card.
    Quick question though that I’m battling with, Cash passport promises no POS transaction fees, but does American Express charge? I like the benefits of American Express (free back up card, global assistance, etc), but am weary of there being hidden costs….
    Any help/suggestions would be greatly appreciated.
    Thanks,
    Amelia

    • - July 3, 2015
        -   Reply

      Hi Amelia. Apologies for the delay. I called AMEX and Nedbank earlier this week and couldn’t get much clarity on the POS fees. I then noticed this sentence in the Global Travel Card’s Terms and Conditions “Note that some merchants may charge an additional fee when the
      Card is used. This fee is determined and charged by the relevant merchant and is not retained by us.”
      I looked at a few sites and it seems to be common knowledge that AMEX merchants charge more that Visa/MasterCard. See: http://www.fool.com/investing/general/2014/06/16/heres-why-american-express-can-charge-more-than-vi.aspx

      You could also consider getting these benefits from your travel insurance on a cheaper card. AMEX merchants may charge 3% where as your MasterCard/VISA credit card fee is generally 2%. You have to weigh the benefits i.t.o. how much you plan to spend and whether the prepaid card fees (for card purchase and top up) may end up being more expensive than a slightly higher currency-conversion rate credit card.

      I haven’t found one solution that’s a best fit for all scenarios yet.

      • James
        - March 21, 2016
          -   Reply

        Hi also please tall me where can I swipe my card in Delhi if any one knows it about lats say 50000£ if I want

  4. Hans
    - June 27, 2016
      -   Reply

    Zaid,

    Thank you for posting this; I found it most helpful. I will be using my Capitec card for an upcoming trip.

  5. - December 5, 2016
      -   Reply

    Thank you so much for taking the trouble to compile this post, it was very informative!

  6. Jessica
    - April 10, 2017
      -   Reply

    HI Zaid
    Thanks for the great post and helpful breakdown of costs. I have recently discovered Payoneer,https://www.payoneer.com/main Have you had any experience with this as a ATM withdrawal and POS option? I want to use it in Italy.

    • - May 5, 2017
        -   Reply

      Hi. No idea about Payoneer.

  7. Mathew
    - August 25, 2017
      -   Reply

    Hi Zaid – great read!

    Had a question though.

    I’m travelling through the UK and have been swiping my FNB cheque and credit card on a few purchases. When I try recalculate the (R) amount that was deducted from my account – even when using the given logic and using the fx rate at the point in time – the amounts are always off and looks as if the bank is charging more than they should, at time more than R10 – R15. The merchant I used doesn’t charge additional POS fees.

    In your article you mention an “indicative rate”, I wanted to understand what you mean by this – is this different to the standard GBP/ZAR rate I see on any standard exchange rate website?

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