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What are credit card foreign transaction fees?

Using your Singapore credit and debit cards is a convenient alternative to cash while you're overseas.

However, you should be aware of any foreign transaction fees you may be charged when spending abroad.

Types of foreign currency transaction fees

Here are 4 fees you should know about, and 7 tips on how to minimise them (or even avoid them altogether).

1. Foreign currency conversion fee

There's usually a fee to convert to another currency if you use your card outside Singapore. This fee is imposed by the credit card issuer or payment processor. 

If you pay in the local currency, the fee will be a percentage of your purchase amount. For HSBC customers, this is 1.5% for foreign currency transactions made on a debit card. An additional charge of up to 1% will be imposed by the Visa card. 

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2. Other foreign transaction fees for debit cards

On top of the currency conversion fee, you may also be charged a separate fee to withdraw foreign currency from an overseas cash machine.

For HSBC customers, a transaction fee of SGD8 will be charged at overseas ATMs in the VISA, MasterCard, PLUS or Cirrus networks. HSBC fees are waived for HSBC ATMs[@overseas-withdrawal-fees].

HSBC Premier Everyday Global Debit Card cardholders can enjoy free cash withdrawals across all ATMs worldwide – even those outside the HSBC network. Additional fees by other banks may apply.

3. Other foreign transaction fees for credit cards

While a debit card withdrawal takes money straight from your account, a credit card cash advance is really a short-term loan borrowed against the balance of your card. But unlike a credit card, which gives you a month to pay your bill, a cash advance will start to rack up interest charges the moment you make the transaction.

Cash advances also:

  • Carry high fees – around 6% of the amount withdrawn, or SGD15, whichever is greater
  • Charge an annual interest rate of around 26%
  • Usually charge ATM fees
  • Won't earn you spending rewards or rebates
Try not to use your credit card for cash advances unless it's an emergency.

4. Interest charges

If you use your credit card to pay for things outside Singapore or withdraw cash, interest charges will apply in the same way they do at home. Credit card issuers will only charge you interest if you carry your debt past the billing date. 

How can you minimise your foreign currency transaction fees?

Now that you know what fees to look out for, hopefully it will be easier to avoid them.

1. Open a multi-currency account

Shop around and compare accounts. You might find one with zero transaction fees and/or ATM rebates. 

With an HSBC Premier or Personal Banking Everyday Global multi-currency account, you can manage all your foreign currency deposits with a single account. You can also access up to 10 different currencies. What's more, you won't pay:

  • Monthly fees
  • Transfer fees
  • Overseas ATM withdrawal fees[@overseas-withdrawal-fees]Footnote link 1
  • FX fees in the currencies you hold

2. Choose the right credit card

You can partially offset foreign currency transaction fees with the right credit or debit card. Consider a card that's designed for overseas travel, offering some exclusive privileges both at home and abroad. This can include extra air miles and cashback, low annual interest rates, and no annual fees, plus overseas insurance.

Some cards also offer instant miles and hotel points redemptions for even further savings while you travel. See how many miles you'd get for your local and foreign currency spend with our HSBC TravelOne points calculator.

3. Pay in the local currency

This mantra goes for all overseas spending, even online. Merchants may operate locally, but if their payments are processed outside of Singapore, you'll be charged the more-expensive dynamic currency conversion (DCC) rate. Also, if your credit card comes with better rewards for foreign currency spending, you might miss out on those perks if you pay in Singapore dollars.

4. Keep a close eye on ATM fees

Always read the small print before you hit 'OK'. While it may be handy to take out cash at a convenience store, you'll likely be charged sky-high transaction fees and pay terrible exchange rates for the convenience. If you do need to withdraw money, you might want to:

  • Withdraw a lump sum to avoid multiple transaction fees
  • Look for an ATM that's part of your bank's network
  • Use a debit card with zero withdrawal fees

If you're banking with HSBC, just use our online branch finder feature to locate your nearest branch or ATM.

5. Steer clear of cash advances on your credit card

This bears repeating. Taking out cash on your card will cost you a lot of money, and you won't earn any rewards. Read through our FAQs for more information about fees and charges for credit card cash advances.

Are you experiencing financial difficulties? Feel free to get in touch with us at HSBC. We may be able to help you.

6. Wait to change your money

Again, you'll be paying extra for the convenience of buying foreign currency at the airport or a money changer. Instead, use your multi-currency debit card when you get to where you're going to withdraw foreign currency like a local.

7. Check your bank statements regularly

Mistakes can happen, so make it a habit of checking your statement every month. It will show details of your foreign transaction fees, such as:

  • The FX rate
  • The cost of your purchase converted to Singapore dollars if you chose to pay the DCC rate
  • Any fee for converting currency
  • The cash fee, if you’ve withdrawn money using your card

Contact your bank if you notice a credit card transaction error and/or unauthorised transactions. When raising a dispute with HSBC, it's important that you do so no later than 14 days from the statement date to avoid processing delays. 

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