|by Jason Steele|
Of all bank fees, I find the Foreign Transaction Fee(FTF) to be perhaps the worst of all. This is an additional 1-3% tacked on to any foreign transaction for absolutely no reason. The fee is poorly disclosed, randomly set, and wholly unjustified. There used to be a very limited choice of cards that were offered without and FTF. Capital One was the only major bank that had no FTF on any card, while there were some credit unions that were FTF free as well.
In the past few months, there have been more and more cracks appearing the foreign transaction fee scam. As Chase and Amex dropped the fee on a select few of their cards. On Amex, they are planning on doing it with their very high end cards with the large annual fees that saw the FTF go away. At Chase, it was a few travel focused cards that shed the fee.
One of the biggest fee foes out there has been Ron Lieber of the New York Times. He reports today that Chase has added their Continental and United branded cards to the fee free party. As with previous moves, they appear to be targeting people who travel a lot. That makes sense. People with travel reward cards are getting smart to the “negative reward” perpetrated on them by their banks. I am sure that many, like me, are leaving their reward cards at home when they leave the country. I will only use my Capital One card since it has no FTF both because none of my rewards exceed the FTF and just on principal of not wanting to be ripped off.
By shedding these fees, I am sure that Chase and others are trying to get their internationally mobile, high spending customers to keep using their cards in other countries. Don’t forget that they also reap the normal transaction fees when you use your card out of the country.
Don’t Count Your Chickens With Amex
Lieber points out in a correction that Amex has not actually dropped their FTFs yet, as he says:
An earlier version of this post referred incorrectly to the status of foreign-exchange fees on American Express cards. While the company says it plans to drop the fees on some cards, it has not yet done so.
Nice job Amex. They announced that they would be dropping the fee, but hasn’t done so yet. Pretty sneaky.