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Credit card charges and currency conversion

Lewes, United...
Destination Expert
for Road Trips
Level Contributor
25,821 posts
38 reviews
Credit card charges and currency conversion

I was just wondering if there had been recent changes in NZ banking regs which may have an impact on visitors when then charge to overseas credit cards.

There has been more than one topic on these boards in the last month or so containing commenting on charges for converting from NZ$ to the currency of origin of the credit card. (Some comments, for example, appeared buried within posts on the topic of Apex car rentals.)

I've now been received a CC bill for a payment made for a trip due to take place during my forthcoming trip. The entry shows the amount charged by the supplier in NZ$, the conversion rate, the amount I've been billed (in my case £ sterling) plus a commission charge.

I have gone back to the supplier to ask whether they levied this commission charge, as well as the credit card issuer, but haven't had responses yet from them. I also wondered if there was another reason for this charge?

We travel to foreign countries all the time, and use any and all of our credit cards on these trips. We've never seen a commission charge before.

Sydney, Australia
Destination Expert
for Train Travel
Level Contributor
97,547 posts
17 reviews
1. Re: Credit card charges and currency conversion

The commission will almost certainly be a charge by your bank for the foreign exchange. The suppliers do not charge or get commission.

Saskatoon, Canada
Level Contributor
256 posts
3 reviews
2. Re: Credit card charges and currency conversion

Just checked some bookings done about 6 weeks ago for our NZ trip later this month ..only the currency exchange to Canadian $$$ ...NO extra charges .So the assumption must be it is your bank doing the additional charges ..

Marvie

Christchurch, New...
Destination Expert
for South Island
Level Contributor
9,531 posts
220 reviews
3. Re: Credit card charges and currency conversion

If you have a Barclays card you can get money from westpac ATM's without the transaction charge. You still pay the currency commission however.

Christchurch, New...
Level Contributor
215 posts
1 review
4. Re: Credit card charges and currency conversion

We live in NZ and travel a lot. I've got fed up with paying the surcharges on cc - sounds a good idea to travel with a cc and use it for everything, but you end up paying heaps! Here in NZ our banks do 'travel cards' You load it up with cash before you go and use it just like a cc in shops, cafes etc, but obvioulsy you can only spend what you have loaded on to it. Other alternative is to bring cash......

Find out if your bank has a reciprical arrangement as regards withdrawing cash from ATMs some banks don't charge for this.

Let's face it whatever you do is going to cost..... You can''t beat the banks.

Lewes, United...
Destination Expert
for Road Trips
Level Contributor
25,821 posts
38 reviews
5. Re: Credit card charges and currency conversion

Thanks for the responses.

I didn't think the service supplier had charged the commission, but in the absence of a response from them, thought I'd ask.

The CC in question is Amex which we use all the time, all over, and this is the first time we've seen a commission charge. Again, still no response from them yet.

For us personally it will be unfortunate if Amex are now charging as I have to confess that their card is the CC of preference as we earn both mileage and free air tickets from using the card which helps towards our long haul travels. UK based spend only will mean it takes much longer to get the next free flight!

We already have an ATM card which doesn't charge commission on foreign ATM usage, but there's always a hidden fee lost in the conversion rate, of course. We're not in the habit of going around with lots of cash and had learnt that NZ is a place where you can use credit cards freely almost everywhere, which, therefore, we had thought was the way to go!

SWT

San Francisco, CA
Level Contributor
1,084 posts
101 reviews
6. Re: Credit card charges and currency conversion

I've never heard of a commission either. The latest gotcha is the credit card offering to charge in a non-local currency (at a poor exchange rate).

My US issued credit card doesn't charge a foreign exchange conversion. Amex didn't used to; at least they disclose it on the statements.

I also have a debit/ATM with no fees that can be used anywhere that takes Visa.

No sense spending your hard-earned vacation money on 2-3% in bank fees if you can avoid it.

Christchurch, New...
Destination Expert
for South Island
Level Contributor
9,531 posts
220 reviews
7. Re: Credit card charges and currency conversion

Amex is not widely accepted here. Many small traders (cafes etc) only take visa or m/c.

Edited: 6:37 pm, January 11, 2011
Christchurch, New...
Level Contributor
215 posts
1 review
8. Re: Credit card charges and currency conversion

Was going to say the same as you. Many places won't accept Amex or Diners as they are not credit cards but debit cards. Also seen this in Australia as well as NZ.

Wellington, New...
Destination Expert
for Wellington, Bay of Islands
Level Contributor
10,281 posts
226 reviews
9. Re: Credit card charges and currency conversion

The principal reason Amex and Diners are not accepted in NZ is because of the commission fees they charge retailers which are about double what Visa and Mastercard charge. NZ is fast becoming a cashless society with most transactions even coffes etc at cafes put on the plastic.

Christchurch, New...
Level Contributor
328 posts
18 reviews
10. Re: Credit card charges and currency conversion

Amex and Diners are now gouging between 3 and 4 times the commission off traders that Visa and MC are. Their loyalty programs may look great to the consumer but ultimately the merchant is paying....