How to Avoid Foreign Transaction Fees While Travelling
Quick answer
To avoid foreign transaction fees, carry a card that charges no foreign fee and passes on a fair exchange rate, always pay in the local currency rather than your home currency, and decline the "convert for you" offer (dynamic currency conversion) at tills and ATMs. Withdraw larger amounts less often to spread any fixed ATM charges, and keep a small cash backup. These few habits can save a noticeable slice of your travel budget.
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What these fees actually are
Two separate costs quietly eat into spending abroad. The first is the foreign transaction fee — a percentage some banks add to every purchase or withdrawal in another currency. The second is a poor exchange rate, applied either by your bank or by a payment terminal offering to convert on the spot. Individually they look tiny; across a two-week trip they add up.
Use the right card
The single biggest win is a card designed for travel — one with no foreign transaction fee and a transparent, near-market exchange rate. Many travellers carry two cards from different networks in case one isn't accepted, plus a little local cash for markets, tips and small vendors. Before you fly, check three things:
| Check | Why it matters |
|---|---|
| Foreign transaction fee | Aim for 0% to avoid a surcharge on every spend |
| Exchange rate used | A fair, near-market rate beats a padded one |
| ATM limits & fees | Free-withdrawal caps and any per-withdrawal charge |
| Card network acceptance | Carry a backup on a second network for reliability |
Always pay in the local currency
When a card machine or ATM abroad asks whether you'd like to be charged in your home currency, say no and choose the local currency. That prompt is dynamic currency conversion (DCC), and the convenience rate it uses is almost always worse than what your own bank would apply. Paying in local currency hands the conversion back to your bank, where a good card gives you a fair rate.
Be smart at the ATM
Cash still matters in many places, so withdraw it cheaply. Use a fee-free card, take out a larger amount less frequently to dilute any fixed charge, and decline the machine's conversion offer. Prefer ATMs attached to real banks over standalone tourist-area machines, which often stack on high surcharges of their own.
Small habits that add up
- Tell your bank you're travelling if it still requires it, so payments aren't blocked.
- Keep cards in different places so losing one doesn't strand you.
- Track spending in a simple app to catch surprise fees early.
- Avoid airport currency kiosks for large exchanges — their rates are usually poor.
- Watch subscription and hotel holds, which can carry their own currency quirks.
Don't forget the biggest line item: the flight
Fees on coffees matter, but the flight is usually the largest cost of any trip. Comparing the whole market, staying flexible on dates, and setting a price alert typically saves far more than any card trick. Search in your home currency for clarity, then let a fee-free card handle spending once you land.
Frequently asked questions
What is a foreign transaction fee?
A surcharge some banks add for paying or withdrawing in a foreign currency, usually a small percentage per transaction that adds up over a trip.
Local currency or home currency abroad?
Always local. Being charged in your home currency is DCC, which typically uses a poor rate; paying in local currency lets your own bank convert.
Are travel cards worth it?
For frequent travellers, yes — a no-fee card with a fair rate saves on every purchase and withdrawal. Compare fees, ATM limits and any monthly cost first.
How do I avoid ATM fees?
Use a fee-free card, withdraw larger amounts less often, decline the conversion offer, and choose bank ATMs over standalone machines.
The bottom line
You keep more of your money abroad by carrying a fee-free card, always paying in local currency, declining on-the-spot conversion, and withdrawing cash sensibly. Sort the card before you go, then focus your savings where they're biggest — the airfare. Start a live search on ScanFlyGo, check popular routes, and track your flight live on the day you travel.
Some links on ScanFlyGo are affiliate links — we may earn a commission at no extra cost to you. This is general information, not financial advice; always check your bank's current terms.