{"id":15843,"date":"2010-07-13T20:00:34","date_gmt":"2010-07-14T00:00:34","guid":{"rendered":"\/\/www.askmrcreditcard.com\/news\/?p=15843"},"modified":"2010-07-13T20:00:34","modified_gmt":"2010-07-14T00:00:34","slug":"challenges-you-face-using-your-credit-card-in-europe","status":"publish","type":"post","link":"https:\/\/www.askmrcreditcard.com\/news\/challenges-you-face-using-your-credit-card-in-europe\/","title":{"rendered":"Challenges You Face Using Your Credit Card In Europe"},"content":{"rendered":"

It used to be that every time you went to Europe, you were faced with a confusing array of currencies.\u00a0\u00a0 It seemed like every time you travel a few miles in any direction, you crossed a border and had to change all of your money.\u00a0\u00a0 Well, that era has ended and we now have the convenience of the Euro.\u00a0\u00a0 On the other hand, most people will use credit cards for almost all of their transactions anyways.<\/p>\n

You would think that would be a good think, as they should have the same Visa, MasterCard, and American Express acceptance that we have here in the States, but don’t expect everything to go seamlessly in the Old World.<\/p>\n

Some Potential Gotchas<\/strong><\/p>\n

One of the big ones is the Chip and Pin system.\u00a0\u00a0 This is a great system that, as it’s name implies, uses a chip in your credit card in combination with a PIN number entry.\u00a0\u00a0\u00a0 From what I understand, it works very well, except for the fact that virtually no US issued credit cards have that feature.\u00a0\u00a0\u00a0\u00a0 When an American cardholder tries to use this system, they will get an error and be forced to see a person to try to figure it out, creating inconvenience from convenience.\u00a0\u00a0 Worse, many of these systems are deployed in unattended areas such as train stations.<\/p>\n

Another problem you might encounter is MasterCard acceptance.\u00a0\u00a0 Many times, applicants can choose Visa or Mastercard when they apply for a card.\u00a0\u00a0 For the most part, it makes no difference as I have yet to encounter an American merchant that accepted one without the other.\u00a0\u00a0 This is not the case in Europe, as many merchants will only accept Visa.\u00a0\u00a0 One high profile example will be the 2012 Olympics in London.\u00a0\u00a0\u00a0 They have announced that they will only accept Visa for ticket purchases<\/a>.\u00a0\u00a0 If you are planning on traveling to Europe, and you have a choice, pick Visa or at least carry one as a backup.<\/p>\n

Another major issue that travelers to all parts of the world face is the foreign transaction fee that credit cards charge.\u00a0\u00a0\u00a0\u00a0 This is a scam, pure and simple.\u00a0\u00a0 Credit cards offer what is actually a good exchange rate, but then they tack on a 2-3% fee for no other reason than the fact that they can.\u00a0\u00a0\u00a0 For example, Amex recently increased their fee from 2% to 2.7%.\u00a0\u00a0\u00a0\u00a0\u00a0 When I am traveling outside the country, I will put away my Amex reward card and use my Capitol One card that has no foreign transaction fee.\u00a0\u00a0 There are a select few banks that offer cards that don’t have this fee, such as the PenFed, the Pentagon Federal Credit union.<\/a><\/p>\n

Another, more insidious scam is the Dynamic Currency Conversion<\/a> system.\u00a0\u00a0\u00a0 A merchant offers you the option of charging something in your home currency.\u00a0\u00a0\u00a0 It is more complicated, but in this case the merchant is getting a huge kickback by getting your to agree to pay in dollars, with a huge conversion fee included.\u00a0\u00a0\u00a0 Naturally the huge conversion fee is not typically mentioned.\u00a0\u00a0 The worst part is that your credit card company will also charge you the foreign transaction fee, regardless of what the merchant tells you.\u00a0\u00a0 You just won’t find out until a month down the road.<\/p>\n

One Cool Thing<\/strong><\/p>\n

It is not all doom and gloom over there for credit card holders.\u00a0\u00a0 One neat device you will see in Europe is a portable, wireless credit card processor.\u00a0\u00a0 This device looks like a cross between a standard credit card machine and an accountant’s printable calculator.\u00a0\u00a0\u00a0 Many restaurants will present this device to customers at the end of the meal.\u00a0\u00a0 You swipe your card, enter a tip, and print your receipt without having to wait for the waiter to do anything.\u00a0\u00a0\u00a0 This is a huge advantage when confronted with European style service which places an emphasis on not interrupting the diners.<\/p>\n

Some Suggestions<\/strong><\/p>\n

When traveling in Europe or anywhere outside of the United States:
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