Bring Euros or use the ATM? The math seems to say bring them.

If you buy Euros (or any other currency) from your bank, somebody has to get those Euros (fly them across the Atlantic), count them out, and ship them securely to your bank separate from the normal money delivery. Just so that you can pick them up (at a counter, from someone who is paid by the bank). And then carry them back across the Atlantic. All this human handling costs money, and the bank is not a philanthropic organisation.

If you stick your card in a bank cash machine in Europe, there is no extra human handling, just the person who filled up the machine, and that is the same as when you get money out of a machine at home. All the rest is done by computers and internet messages crossing the Atlantic, and they have lousy pay scales. That has got to be cheaper.

That is why there are two different exchange rates, the "credit card" rate which applies for electronic transactions, and the "cash rate" (about 6-8% worse) for cash transactions.

"I can buy Euros near me for 5 cents over the quoted rate without a 3% fee." What do you mean "5 cents over", the Interbank rate plus 5 cents per Euro? The current Interbank rate (Oanda) is $1.05974 per Euro. Add 5 cents to that, and you pay $1.10974/€. That's an exchange rate charge of 4.986%, almost 5%. I am not sure what BofA charges for European withdrawals, but I would guess that they are competitive with Wells Fargo, which charges 3% plus a flat $5, which for a $500 withdrawal is about 1%, so they charge ~4%. There are credit unions that only charge 1% (some nothing, although they are "eating" the exchange fee).

"If I withdraw money from an ATM, I lose that 3% transaction fee in addition to the money I lose on the exchange rate." I think the 3% transaction fee is the same as what you lose on the exchange rate.

I was in Germany last year for 3 weeks, spanning 2 calendar months. My Wells Fargo account gives be three fee free ATM withdrawals per calendar month, so for the whole vacation, I paid only the Interbank rate (I checked it when I got home). My partner used here credit union ATM card and only paid 1% over.

I'm not sure I believe the "5 cents over" either. Every exchange bank I have ever seen (Wells Fargo, BofA) charges a percentage (WF 5%, BofA 5½%). WF keeps the same rate all day long, so it the actual rate goes down during the day, they might be charging more than 5%; if it goes up, they might be charging less, but on average, it is 5%. At $1.00/€ it might be 5 cents, but as the exchange rate goes up, it will be more than 5 cents (but still 5%).

gulfside I think you are comparing apples to oranges. Nobody on this website would ever advocate taking money out of an ATM in Europe using your credit card. Most advice is to use a debit card over there for the best rate to get cash. The last time I did that, the exchange rate premium + fee was much less than 5%. I think it is rare to find a rate as low as you quote over here. If I order currency from my local bank, their rate is from 10-15% over the interbank rate, plus a $15 flat fee for each transaction.

We answer this question a thousand times a year. The answer is always the same. I'll let Rick explain it:
http://www.ricksteves.com/travel-tips/money/cash-tips
http://www.ricksteves.com/travel-tips/money/cash-machine-atm-tips

This topic is an ongoing FAQ. See :
http://www.ricksteves.com/travel-tips/money/cash-tips

Don’t buy foreign currency in advance. Some tourists just have to have
euros or pounds in their pockets when they step off the airplane, but
smart travelers don’t bother and know better than to get lousy
stateside exchange rates. Wait until you arrive at your destination;
I’ve never been to an airport in Europe that didn’t have plenty of
ATMs.

Keep in mind that financial institutions have multiple markups starting with bid-ask spread, conversation fees and other charges such as delivery fees any.
http://www.fxdd.com/us/en/forex-resources/forex-education/forex-tutorials/exchange-rates-and-spreads/
Keep in mind that retail bid-ask spreads are far wider than wholesale (I.e currency trader) spreads.

As a test check the interbank rate with a +/- 0% spread (bid=ask) and compare what your bank is charging you for the same amount or Euro, Pounds, or Krone.
http://www.oanda.com/currency/converter/
For example did your $320 USD buy you €301.70 EUR? (No mark up) or €295.67 EUR (typical ATM).

Sort of related to this string.... is it still true that the magnetic strip debit cards work in European ATMs, or would a traveler need a chip and pin card? I read the article on your site about using ATMs overseas, but I'm not sure how long ago it was posted. A friend was not able to use her debit card in European ATMs when traveling in 2014, so I'm curious about this.

In October 2013, I had no problem using a mag strip card at ATMs in Europe.

Was Gulfside really comparing getting Euro here to using his credit card in an ATM over there? I didn't think anyone would do that. If you don't have any money, and you are borrowing everything on your credit card for the trip, then I guess you would be better to buy it here with your credit card rather then use a cash advance over there. But why not just save the money before you go?

Sorry for the confusion. I wasn't suggesting using a credit card, just that checking on the rates using the credit card, led me to believe that it might be cheaper bringing cash.

I read Ricks post, but there wasn't anything in the post that had actual figures to justify the claim, so I asked.

I checked exchange rates and compared the interbank rate with Palpal (.9465 to .9186). BAC was higher, so My $320 bought $293.952 Euros. Not as good as the Typical ATM from what Edgar said. I was guessing that using an ATM, I would have to pay a similar percentage to a credit card transaction and as they are both electronic, plus an additional 3%. Bank of America is notorious and very close with their information. It is difficult to get a straight answer sometimes.

As for BAC withdrawals they had 1.198 for today's exchange rate.

https://www.bankofamerica.com/foreign-exchange/currency-converter.go

Some people just like to see the numbers. Thanks for all the help. Looks like the real solution is to change banks.

Hi gulfside- I use Chase Bank which has similar withdrawal fees and I did this math one year ago. With Chase, if I get money from the bank, they charge me a worse exchange rate but no transaction fees. If I go to the ATM in Europe, the exchange rate is better but there is the transaction fee plus $5 fee. So for a smaller amount (100 or 200), the prices were comparable. But for a few large withdrawals from ATM (which is what I tend to do in Europe, get a large amount a couple of times) it is in my favor to go to the ATM. I can try and find the post to show you the math, if you are a math nerd like me.

I was guessing that using an ATM, I would have to pay a similar percentage to a credit card transaction and as they are both electronic, plus an additional 3%.

No. You would not expect to pay another 3%. As Lee said, I would not expect to pay any additional fee more than a $5 flat rate per transaction. You can minimize those flat fees by requesting your bank to raise your daily withdrawal limit (at least to $500) and by taking out the largest amount that any particular ATM will give you. For instance, DeutscheBank will sometimes allow withdrawals of over €1000 in a single transaction and they're located in many countries.

mes2052, are you sure that your friend called her bank before traveling to tell them she would be making withdrawals from Europe? That is the most common reason for failure of a debit card to work in an ATM. I use my regular old credit union mag stripe debit cards every year in Europe and have never had a problem (aside from the random machine that doesn't work, but I just move down the block to the next one). It's also wise to travel with debit cards tied to two different institutions (I use a credit union and an online bank that I can transfer money between if necessary). That way, if one card fails, you can get money from the other one.

Gulfside, BoA also has "partner banks" in Europe (they can give you a list). If you use an ATM belonging to one of them, BoA will not charge their usual transaction or conversion fees.

mes2052 - I used my normal mag strip debit card in ATM's all over Europe, from Belgium to Hungary, in June/July 2014 and had not problems anywhere. In fact I actually had 3 debit cards with me (from 3 different accounts just in case) and had no problems with any of them.

Re: "partner banks" in Europe (they can give you a list). If you use an ATM belonging to one of them, BoA will not charge their usual transaction or conversion fees.

No BofA "uasage fee" if you use a partner bank ATM, but BofA imposes an "international transaction fee of 3%". See:
https://www.bankofamerica.com/deposits/manage/how-to-pay-when-traveling-abroad.go

Keep in mind that when you use your debit card to withdraw money from
an international ATM, Bank of America will assess an international
transaction fee of 3% of the converted U.S. dollar amountFootnote3.

My credit union foreign ATM w/d is far better with essentially Interbank rate.

Up until now, a lot of banks have been issuing credit cards with no foreign transaction fees. My partner bought some clothes in Munich with my United Explorer card, and I was charged only what the department store in Munich charged. However, I'm sure they've been doing this to get you to use the card because they get around 5% from the merchant and can absorb the foreign transaction and currency fees that they pay (~1%). This is about, I think, to change. The EU has passed a law limiting the fee the credit card company can charge the merchant to 0.3% of the purchase price. It goes into effect in June. I think we will see credit card companies return to the foreign exchange fee and omit cash back from European purchases.

Edgar, I believe that's if you do not use a partner bank. Has that changed?

Nancy,
I used the Deutsche Bank ATM in the Frankfurt FRA Airport while connecting on the flight to Salzburg. No ATM usage fee as advertised but the 3% foreign transaction mark up over Interbank as BofA notes.

Nancy,
I used the Deutsche Bank ATM in the Frankfurt FRA Airport while connecting on the flight to Salzburg January 2014. No ATM usage fee as advertised but the 3% foreign transaction mark up over Interbank as BofA notes.

If you are interested in the true rate compare what you bank charges against the Interbank rate for the settlement date. http://www.oanda.com/currency/historical-rates/

The math always says that the most convenient and cheapest way to obtain local currency is via a debit card at a bank owned ATM anywhere in Europe. The exchange rate will always be within 1% of the Interbank rate. There are no user fees charges by the European ATM. After that all charges will be determined by your card issuer. Even if your debit card charges 3% currency conversion fee it will still be cheaper (by a small margin) than obtain Euro from a US bank. Some have tried but when the comparison is truly apple to apple, it is always cheaper to get Euro from an ATM. Many of us carry debit cards mostly from credit union that only charge 1% or less over the network exchange rate.

We spend a good bit of the year in Europe and I would never recommend getting euros in the USA. We prepay for things like hotels and railpasses and even buy tickets online before our trip and when we get there, we use debit MasterCard to pay in restaurants and shops. When we do exchange money for euros, we do it at a bank or at a bank's ATM and get as much as we think we'll need at one time for one fee.

It is generally not considered smart to use a debit card for retail purchases nor can you exchange money at an ATM. And most banks are not eager to exchange dollars either. Stick with using a debit card to withdraw cash and a credit card for purchases.

Terri Lynn: could you inform us how you "exchange " dollars for euros at an ATM? Also, in most European countries, unless you have a bank account in the country no services are offered, so I wouldn't count on being able to walk into a bank and get some euros. I know it is the same in my country. My own bank serves only its customers.

Depends if you consider a bureau de change to be a bank or not. Go to a specialist in country and you can exchange on a swing of 2% - if you pick the right one (check on line). Still more than the best ATM cards, but a whole lot better than the likes of Bank of America.

Does anyone consider a bureau de change a bank? They don't look like banks, often being little more than kiosks or small shops.

The Edgar-Nancy exchange here is good. With the BA debit card it all depends on using the "right" bank atm in Europe. Check with BA on their policies. For convenience, I have bought foreign currency thru my bank in the USA several times.

Norma, by "exchange money for euros, .... at a bank's ATM", what Terri Lynn means is put her bank card into an ATM (exactly the same card as she would use in the ATM in her home branch). The machine gives her Euros (or whatever the local currency is). and charges her bank for those Euros. Her bank (or the card agency) converts the amount to the currency of her account, but does not add a money handling charge because no money is being handled, and debits her account.

This is by far the cheapest way to get local currency.

OK Chris, I guess it is just semantics. I withdraw (or get) money from an ATM, whereas Terri Lynn uses the word exchange. Odd.

I wanted to know how much i would have to pay to get euros for my italian trip next month. FYI, this is the info which i got about 4 days ago from my bank assuming i was doing transactions in italy. Keep in mind that i am using CAD and the Euro has dropped over the last week. But it is a useful comparison.

Best googled internet rate: €1 = CAD$1.35
Bank rate: $1.40, plus $5.00 my bank ATM fee
(italian bank may also charge an additional ATM fee and there is a €250 daily limit)
Bank mastercard: Same bank rate + 2.5% = $1.435

I could buy the euros from my bank at the above rate without the fee. If i bought over $1000, the rate would drop to baout $1.39. But the teller suggested that i go to a local money exchange to get a better rate. There are several near my office. This is what i found for the same day as above:

Local Money Exchange: $1.37, plus $3.00 fee (there was one money exchange which did not charge a fee, but they did not have any euros available).

Please note that I live in Vancouver which has a large Asian community with lots of people travelling back and forth to Asia. There are a lot of these money exchanges and they are very competitive.

I plan to wait until the last week and buy a fistful of Euros here in Canada to cover me for the first few days. Save me the hassle of having to look for an Italian bank atm my first day.

Funpig CAD to EUR:

See: http://www.oanda.com/currency/converter/

HELP DATE:INTERBANK +/-Looking for International Transfer? Try World First
Rate DetailsTraveler's Cheatsheet
EUR/CAD Details
EUR/CAD for the 24-hour period ending Monday, Apr 13, 2015 22:00 UTC @ +/- 0%
Estimated price based on daily USD rates
Selling 1.00000 EUR
you get 1.33339 CAD
Buying 1.00000 EUR

you pay 1.33388 CAD

EUR/CAD Details
EUR/CAD for the 24-hour period ending Monday, Apr 13, 2015 22:00 UTC @ +/- 2% (Typical ATM rate)
Estimated price based on daily USD ratesstrong text
Selling 1.00000 EUR
you get 1.30673 CAD
Buying 1.00000 EUR

you pay 1.36110 CAD

EUR/CAD Details
EUR/CAD for the 24-hour period ending Monday, Apr 13, 2015 22:00 UTC @ +/- 5% (Typical Kiosk rate)
Estimated price based on daily USD rates
Selling 1.00000 EUR
you get 1.26672 CAD
Buying 1.00000 EUR

you pay 1.40408 CAD

funpig-
The "bank rate" your bank charges you to exchange euros is not the same "bank rate" you get if you use an ATM in Europe. When you use an ATM in Europe, you will get pretty close to the "best googled exchange rate" (to use your words). The local banks adjust the exchange rate when they are exchanging currency here (or in Canada).

There is a lot of back and forth on the forums about the cost/necessity of obtaining some Euros before you go. If you choose to do that, I think most of us agree to not go to a currency exchange. They do a great job of hiding their fees and you always end up getting a worse exchange rate. And I live in Chicago where there are also a lot of international travelers.

Edgar is correct. Not to pick on Nancy, but she was using old data. Bank of American changed their policy in the last two years. Even at a Global Alliance bank (in its home country, not in an adjacent country where ALL fees will apply) you pay 3% to get your own money out of your savings or checking account, despite the waived fixed-fee for machine usage. I have to note that consumer analysts told us that if we made it harder for the banks to stick it to us on overdraft and account fees (partly to protect less wealthy customers being victimized) the banks would get the income from somewhere else. The 3% is the somewhere else.

I opened an account at a credit union for this reason. We travel often and it's worth the extra trouble (to me, anyway) to keep down the CEO's bonus at Bank of America.

This is why I asked initially, as Edgar pointed out:

Keep in mind that when you use your debit card to withdraw money from
an international ATM, Bank of America will assess an international
transaction fee of 3% of the converted U.S. dollar amount. Foreign
ATM operators may offer to do your currency conversion for you, but
they may charge a higher fee for conversion.

BAC may be particularly onerous. I don't think in this case it is safe to assume that BAC uses the interbank rate to determine "the converted dollar amount", for my retail transactions. To the contrary the statement "Foreign ATM operators may offer to do your currency conversion for you, but they may charge a higher fee for conversion." implies that there is some conversion fee charged by BAC (however small). There is a very good chance that as a BAC customer I will be charged some overage plus a 3% fee. If there are any BAC customers out there, I would appreciate you relaying your experiences.

Thanks

We were in Italy in May and I just received our Canadian bank statement showing our one ATM withdrawal in Italy. It turned out to be the highest exchange rate of all our transactions (CAD$1.39 per Euro, plus we were charged a Cirris transaction fee of CAD$3.00). I could only withdraw €350 because I have CAD$500 withdrawal limit.

Most of the differences were the result of the fluctuating currency rates, but when I bought Euros while still in Canada in the last week of April just before leaving for Italy, I found the local currency exchange VBCE to have the best rate (CAD$1.334 per Euro and no commission; i bought a €1000) when compared to my banks (i have two banks and each quoted me over CAD$1.35 per Euro on the same date).

Anyways, it pays to call around to get the best rate. And if your bank charges a transaction fee on top at the ATM, your cost increases even more.

I am still waiting for my VISA credit card bill.

So what's your point? You paid 1.334 CAD per euro. You didn't give an exact date, but on April 23, the average Interbank rate for the day was 1.3129 CAD per euro.

But yes, it does pay to call around.

I purchased my euros from VBCE on Monday, April 27. I missed the euro low point which was on either the previous Thursday or Friday, if I recall. I was watching the Greek credit crisis on the Friday and gambled that the euro would keep dropping. When the euro started to rise on Monday, I pulled the trigger and bought. On the same day that I bought from VBCE, I called my two banks and the euro would have cost me almost 1.5 cents more at the banks.

The only point is that at least in Vancouver, it was cheaper for me to buy euros from a certain currency exchange than from the banks on the same day. So yes, it pays to call around.

I don't know what exchange rate I would have gotten in an Italian bank on April 27 (i can't be isn two places at the same time), but I would have had to pay a $3.00 ATM bank transaction fee to withdraw any money (max. about €350 at a time) from my account. I would have had to incur three transaction fees (3 x $3.00) to take out the same €1000 in Italy. I did not pay any fee at VBCE.

If it helps, I withdrew €350 on May 12 from an Italian bank ATM at a bank exchange rate of CAD$1.393180 plus the $3.00 fee. I don't know what the VBCE rate was on the same day because I was not in Canada and also did not check online on that day.

According to the VBCE website today, it would cost 711.10 CAD for 500 euro. The Interbank rate from Oanda today is 695.79 CAD for 500 euro. That's a markup of 2.2%. The best I have found in this country is Wells Fargo at 5% (average). Unfortunately, I don't have Canadian dollars, and I suspect VBCE would not take USD straight across.

I don't think Italian banks would charge anything to use an ATM, although stand-alone 3rd party ATMs could. Any fees or difference on the exchange rate would be charged by your bank. My credit union ATM charges 1% on the exchange rate with no fees, so even if I could get euro here at 2.2% over, using my CU's ATM card over there would be better. On the other hand, national banks (like Wells Fargo), charge 3% on the exchange rate plus a $5 fee on a withdrawal that is usually limited to $500, so about 4%.

I know of one local bank in Colorado that will get euro from Wells Fargo. Last I checked, they did it without any fee as a service to account holders. I know of one national bank in Denver that gets foreign currency from Travelex, which is one of the worst places.

Lee, YMMV. I am not going to Colorado to open up a bank account to buy Euros. Whatever the interbank rate you quote would not help me if my Canadian bank uses a higher rate plus tacks on a transaction fee.

There are going to be significant differences in exchange rates depending upon countries, states, cities, financial institutions and dates. For whatever reason, in Vancouver, it was cheaper to buy foreign currency at some (not all) currency exchanges than at a bank. Possibly it has to do with the large Asian community with both tourists and residents travelling back and forth to Asia which has created a demand and a lot of competition to keep the rates down amongst the many currency exchanges. The lineups at VBCE are usually more than 30 minutes long. My brother always goes there to buy USD to shop in Washington because it is cheaper than getting USD at the bank.

Like I said before, it does not hurt to call around for the best rate.

I had read somewhere that the ATM's at the European airports were not convenient on weekends as they either run out of money or don't work for some other reason. Has anyone had this problem this year? If I need to hire a taxi on a Sunday morning to get from Paris airport to hotel, I'll need to pay driver somehow and will dollars be accepted?

In Charles de Gaulle 2 years ago, I ran into the chip and pin issue trying to use an ATM. So I wasn't able to find one I could use. This issue, aside, I have never run into an ATM in an airport that did not work or ran out of money and I usually arrive on a weekend.

Some taxis in Paris will accept credit cards. But you have to specify when you get in. At CDG taxi stand, I let the man know I needed to use a credit card so he hailed me a taxi that would accept it.

thank you. Kristen, that's very helpful to know about credit card usage and taxi's.

Just checked my Visa credit card account statement. On May 13, 2015, I made a purchase in Italy and the Visa exchange rate was CAD$1.4039 = €1.

The Italian bank ATM exchange rate on May 12 was just slightly lower (see my above post). However, with the $3.00 ATM Cirrus transaction fee, the difference between using my credit card and the ATM withdrawal was pretty close.

My best rate was buying my Euros in Canada at VBCE.

BTW, i was at RBC Bank Canada on June 23. The bank's exchange rate was CAD$1.4183. VBCE Currency Exchange rate was CAD$1.4001 on the same day.

I just checked VBCE's website, and right now they are selling euro for CAD$1.4104/1€. Oanda says the Interbank rate is CAD$1.38629/1€. So VBCE's markup is 1.74%. My credit union charges 1% plus zero fees for ATM withdrawals in Europe. I wonder if you can get the same rate from a credit union (do you even have those in Canada?). Maybe you need to call around.

But don't get me wrong. It looks like VBCE is an excellent place to get euro and better than the ATM rate from most big banks in the US. The "Network" (Cirrus, Plus, Visa, MC et al) charges banks 1% for currency exchange and handling the transaction. The rest of the charge comes from the bank you have your ATM card with. Some banks in the US have "feeless" credit cards. They can charge us 0% because they have been getting ~4% from the merchants over there, but the EU has passed a law limiting what they can charge a merchant to 3/10%, so I expect those feeless cards to start charging.

We have credit unions in Canada. But shopping for another financial institution, opening up a new account and adding another bank card and possibly another credit card into my already bursting wallet would not be worth it. I am just comparing what is readily available to me and a lot of other people. I just want to walk in with a bagfull of CAD and walk out with a fistful of of Euros.

On the onada site, you can hit the +/- and it estimates that the typical bank ATM markup is 2%, the typical credit card markup is 3% and the typical kiosk is 5%. With the additional $3.00 Cirrus ATM fee on my current maximum withdrawal of CAD$500, the actual difference between my credit card and my ATM transacrion was quite small. On my nxt Euro trip, I will consider using the credit card much more than cash. There would be no need to look for an ATM, no need to carry a lot of cash and I would have a nice detailed account of my spending from the credit card co at the end of the trip.

I'm a big believer in having Euros (or Pounds or whatever) in my pocket before I go across the pond. The main reason is that it allows you to hit the ground running without worrying about finding an operating ATM. When I flew to Paris a couple years ago and was taking a bus to Opera in the early morning, the only choices for paying for a bus ticket were to use a machine that required a chip & pin card, or to pay the driver in cash. Moreover, I just returned from a RS trip, and one of my new friends from it said that the ATM in the airport was out of order. Fortunately, she had Euros from her last trip on her to pay taxi fare.

For those who think you end up paying more when you get foreign currency in the States, that's not necessarily the case. I bought Euros from an AmEx travel office before my recent trip and paid $1.13 per Euro, plus a $4 convenience fee. I made one withdrawal from an ATM during my trip; I just did the math and, through the ATM, the rate was (wait for it...) $1.13 per Euro, plus a $3 convenience fee from my bank.

Whenever I could, I used my Capital One card because it has no foreign transaction fees, just a straight conversion.

I was in Venice and Milan in Sept. 2015. The Deutschebank ATM in Frankfurt Airport charged me $43 for a 300 Euro withdrawal. Same rate with a Venice ATM. What gives? I thought ATM withdrawals for Euros was the best deal. These were no deal!

Instead of tagging on to a dusty old thread, start a new one to ask a question.

Since this thread has been about using ATMs, his post seems appropriate.

What do you mean by they "charged you" $43? The ATM does not charge you anything, but your bank does. What is your bank? At today's exchange rate, 300€ equals $336. Add the 3% exchange rate "discount" and $5 fee that major banks charge, and today you would be charged $351, or $15 more than the exchange rate. What did they charge you? Was it really $43 more than the dollar equivalent of 300€?

You can get better rates at the ATM. Major banks charge 3% plus $5. My local bank charges 2% plus $2. My credit union charges only 1% and no fee. It's even possible to get 0% and no fee. But 300€ is not $300. You still have to "pay" the exchange rate (currently about 1.12$/€).